The Greatest Scam In Tech

The Greatest Scam In Tech

In the tech world, a few questions are usually enough. Does the product work? Is the idea good? How much does it cost? But as Peep Telephony reminds us, there’s a fourth, all-important qualification: Is it real?

The Consumer Electronics Show, which took place in Las Vegas last week, is a place where you get lied to. A lot. Always, basically, which is one of the reasons reporters attending CES mope so melodramatically: for every cool thing you see, you have to endure hours of pitches, all of which are intentionally misleading, and many of which, disingenuously so.

But that’s how this industry – and plenty of others – work. They pitch; we parse. They stretch the truth; we try to make it contract. It can be a crude and occasionally uncomfortable system, but it generally works.

This year, a company calling themselves Peep Telephony or (Peep Wireless), seemingly popped up out of nowhere with promises of cellular service powered by mesh networking that would be free to consumers. Peep’s promises are manifold: customers will “never need to pay a phone bill again”, and “all their email, internet and media access would be free forever”; network owners could save “billions of dollars and years of build-out time”, doubling their capacity overnight. It’s a software-based system, and, of course, it will be free.

But a visit to Peep’s website can be vexing. Every page is jam-packed with sentences that don’t make sense, literally and technologically. The first video explaining the service says nothing, and appears to be stitched together from spare parts found on YouTube. The second video, an alleged “UI demo”, is too blurry to be useful, and phone in use seems to be a knock-off iPhone. It’s truly bizarre.

To be frank, this all sounds like bullshit. In fact, the combination of everything described was so strange, it almost made the company seem like a larger-than-life prank on the tech world. The closest thing to a technical explanation for Peep is this:

[E] very mobile device connects instantly to every other unit by WiFi, Bluetooth, optical, GSM, CDMA or walkie talkie channels that the PeepApp is constantly scanning. No cell tower, base station or internet server is needed. Phone calls, media sharing, texts, movies, media and data sharing can be free between all mobile devices.

(The rest of the release is filled with meaningly technobabble, and it’s worth a read.)

Of course, they claimed they wouldn’t be showing anything to anyone except select analysts and potential investors. However, they’re garnering coverage for it. A fair amount, actually.

Early coverage just parroted the press release or interview talking points, though later coverage was a bit more cautious. Rafe Needleman at CNET posted on Peep with an open mind and high hopes, but was somewhat worried by the massive promises and uneven explanations. (We reached out to Peep by phone, but haven’t had any luck getting through.)

In addition to arguably being impossible, the problems with Peep go much deeper than unclear business plans and sketchy PR.

Peep Wireless is just the latest in a string of failed tech startups that spans back about two decades, all conceived, helmed and driven into the ground by one man: Scott Redmond. We’ve done a bit of digging into the Peep CEO’s past projects, and they don’t give us much faith in his current endeavor, to say the least.

The pattern is easy to pick out: This dude shows up whenever there’s a bubble or hot trend in the tech business world that has yet to make it to the marketplace, strings together a bunch of technical jargon that hardly informs what he’s doing, and presumably gets some kind of funding. He then forms not one but two companies around said bubble. (Peep Telephony has Peep Wireless; Limnia, a fuel cell company, Fuel Sell; Clever Homes, FabModern). All the companies are listed at the same address in San Francisco.

Then, the companies just disappear, legacies reduced to comically vague blurbs in Redmond’s resume – if that. There’s no point trying to ascribe motives to what Redmond does, and we don’t want to make this about character or intent. Point is, these ventures rarely – if ever – work. And through the harsh lens of hindsight, some look like they weren’t ever meant to.

When you start digging further into his past, you end up plummeting down a rabbit hole where things seem to get more surreal with each discovery.

Redmond is a man who has worn many hats. On his personal site he claims to have worked in the green home, digital outdoor display, flight simulator, computer, mobile energy, auto, aerospace, medical device, media broadcasting and events production industries – among others. His resume is equally spread out, as far as jobs go.

Over the years, he claims he’s created 19 “industry firsts” and lists “conceptual blockbusting” as a key qualification. Most of his previous jobs list him in the role of “Program Executive”, and for the last 14 months, has been an Executive Vice President of Business Development for a “Major Media Software Company”. His words, not ours.

But there’s more than just an ambiguous resume. Let’s take a quick, scattered tour through the underbelly of the tech industry, courtesy of Scott Redmond:

Here he is, talking about a video startup that would offer free streaming films – major films! – to any computer. If I’m hearing this correctly, you don’t even need an internet connection:

It no longer exists, obviously, but it’s worth noting that this kind of service was completely, utterly impractical in the mid ’90s.

Here’s his virtual reality product:

Note the complete lack of video evidence of any kind of functionality whatsoever.

Here’s an idea he had for an inflatable car:

(That $US100m in pending venture money mentioned in the comments never came, for (I hope) obvious reasons.

Here’s an announcement that he’s competing for the Lunar Xprize, somehow, with a personal flying device.

Aaaaaand here’s the patent for said device:

Here’s his concept for the standardisation of fuel cell components (which received nearly 900k worth of funding from the department of energy). He claims it’s functioning, but judging from the video, the thing seems more like a movie prop.

And this list goes on. (Literally! Check his own website)

Redmond also seems drawn to areas where there are cash prizes available. While his flying car isn’t likely to snag any Xprize money, this Department of Energy report suggests that he actually received money from the government for an idea that also seems worryingly oblique.

This post isn’t meant as some kind of personal hatchet job, and to be honest, one shouldn’t be necessary to dissuade investors from throwing money at this venture: Peep’s background information is freely available online, and everything you see above was discovered with a few quick searches on Google. Any investor — or reporter, for that matter — should be able to see these red flags on their own. (As far as Peep is concerned, the seams are already showing. A savvy commenter on CNET noticed that the prototype “PeepPod” — the dongle that allegedly increases the effective distance of the peep app — is just a securID fob with the logo pulled off.)

Rather, this is a glimpse at what happens when hype overcomes all else. It represents an unchecked version of the pungent, insidious promotional ID of events like CES. And it’s worryingly familiar.

There’s a reason Peep got coverage this year.