Pennsylvania’s wondrously dumb digital wine kiosk program in trouble

August 15, 2011 by Dave Haynes

About a year ago I wrote about how the state of Pennsylvania started rolling out a test of automated wine kiosks in grocery stores. Based on the description, images of the digital signage-topped cabinets and video, the only logical conclusion one could draw was that this was never getting beyond a trial. It looked gloriously, wondrously stupid.

Sure enough, a year later the program is in trouble, for a few reasons.

As spotted via James Van Etten’s Clippings (he is probably the only man in Britain monitoring the Pottstown [PA] Mercury newspaper),  the future is uncertain for legal reasons, because the units were breaking down and the usage rates were well below expectations.

Legal issues may bring an end to Pennsylvania’s year-long experiment with controversial wine vending machines in grocery stores.

The wine kiosks, owned by the Pennsylvania Liquor Control Board, or PLCB, have been riddled with controversy over the past year, from system-wide mechanical errors to poor sales. Last week, the PLCB released a letter to Simple Brands LLC, the contractor which operates the wine dispensers, saying the company owed it nearly $1 million due to billing issues, and legal action may be taken if the state is not paid within 45 days of said letter, or by Sept. 20.

“There is an issue of non-payment,” said Stacey Witalec, agency spokeswoman, who added that she could not discuss further details because of potential litigation. Simple Brands did not return calls for comment Monday.

Thirty-two wine kiosks have sprouted up since last summer, but they have largely flopped in Pennsylvania. Originally, the PLCB had planned to open 100 locations.

Each dispenser was expected to sell between 30 to 50 bottles per day, said Witalec, but only 15 of the 32 kiosks reached the lower end of that goal based on weekly sales data. Wine sales were prohibited on Sunday.

Since the beginning of May, only three kiosks exceeded selling 180 bottles in a single week — one kiosk in Philadelphia two times, another kiosk in Collegeville three times and a kiosk in Pittsburgh once.

Mechanical issues have plagued the kiosks, with customers complaining that the driver’s license reader was not working properly and the kiosk was not dispensing wine, said Witalec. Those major issues have been repaired, Witalec said.

But the kiosks have an “Orwellian” character, said Jay Ostrich director of Public Affairs for the Commonwealth Foundation, a fiscally conservative think-tank based in Harrisburg.

The PLCB’s claim that the kiosks offer convenience for the consumer is flawed, because a customer has to blow into a breathalyzer like a criminal and look into a camera where a government employee verifies his purchase, Ostrich said.

Here’s the fundamental thing about any kiosk. For widespread adoption, one of two things has to happen: it needs to make something easier and more convenient (big fail here); or users are presented with no other options (in other words, that’s the only way you’re getting a bottle in the state of PA).

There is a push on – and I betcha this is hardly new – to privatize wine and liquor sales in the state, which now has some 625 state-run stores where you have to go to pick up a bottle.