- Have you heard the conspiracy about McDonald's, about their ice cream. - What about it? (gentle upbeat music) (loud sigh) - Okay. So I've been
investigating something for a long time. Probably deeper than I've
gone on any other video for a while at least. Something I never thought
I would be investigating, but I am. I'm investigating McDonald's
ice cream machines. Who wants to go get ice cream. - Me! - [McDonald Attendant]
Hello, can I take your order? - Can I get an ice cream cone? - [McDonald Attendant] We
don't have ice cream right now. - Not today. - [McDonald Attendant] Not today. - Maybe tomorrow or something? - [McDonald Attendant] Or
next week, I don't know. - Does that happen a lot? Like that, the machine's down. - [McDonald Attendant]
Yeah. In this store yeah. - Okay. For a few years now people have taken notice
that the ice cream machines at McDonald's always seem to be down. - [Woman] The ice cream
machine part is not working. - The broken ice cream machines at McDonald's have been the fodder for a lot of weird internet culture. One guy even made an
interactive map that shows every single McDonald's that
has a broken ice cream machine, at this current moment. - So I reverse engineered the Android app. I think it was like, it was a meme but nobody actually knew if
this meme was correct or not, but they didn't know that was like an, actual thing that all the
franchises are struggling with. - But a couple months ago, I got an email from a guy who said that
he had a deeper story. He said that they're important questions that no one is asking, and he promised me answers
to those questions, and data and evidence to back it up. He even said that there's potentially, something nefarious going on here. - I was like, "Okay, cool. Another conspiracy theory about these McDonald's ice cream makers." So I asked my producer,
Jack, to get on the phone with this guy and hear him out. A week later, Jack called me. - [Jack] And there's actually
something going on here. I've been going through everything and you really need to see this. - Okay. I was still highly skeptical that this could be anything worth
a video or an investigation, but I decided to dive in
anyway and see this evidence for myself. I started looking at data at
internal McDonald's emails. At these mind numbing, 100
page instruction manuals for ice cream makers. I started talking to
McDonald's franchise owners and managers, and guess, it
turns out there is something really weird going on here. Something that hasn't
been reported on before and something that shows that McDonald's broken ice cream machines actually reveal a bigger story about how big businesses protect one another. Even if that means
hurting their customers. I never thought I'd be going
down a deep investigation into ice cream makers, but I am. And I did. And I wanna share with you what I learned. (upbeat music) - McDonald's is getting on (beep) nerves. - And that machine is always down. - The ice cream machine is broken. - And if you tried to pull
the lever, this what happens. (loud whirring) - Sorry, the ice cream machine is broken. The broken McDonald's ice
cream machine epidemic has been so widespread for
so long that it's a meme. - [Man] You know what they're gonna say. You already know, "The ice
cream machine is broken." (hiphop music) - Ice cream machine is broken. (hiphop music) Kinda sounds like there's
a story behind that one, doesn't it? (crowd laughing) (gentle music) - In this very moment, if you look at McBroken, around 13% of ice cream makers in the
United States are not working. That's any red dot on this map. What a brilliant little tool Rashiq made. I mean, this is just so good. So Jack, why are the ice
cream machines always broken? - So once the internet
started to notice this, the Wall Street Journal
and Business Insider and a bunch of other outlets
started to report on it. And the conclusion that they came to was that these machines
aren't actually broken, they're just going through a really long and really complicated cleaning cycle that lasts four hours at a time. And when that happens, the
employees tell you it's broken because it's just easier. But, don't take my word for it. - So when you go there and they tell you it's broken, there's a high chance it's not broken, it's just shut up for maintenance. - Okay. So human error and
this long cleaning cycle, that was the conclusion
that like everyone came to and everyone seemed to
be satisfied with that. I mean, I would be satisfied with that. It's a pretty tight conclusion,
but hold on a second. Wait a minute. (upbeat music) - Do you guys have Frosties? - [Wendy's Attendant] Yeah. - I was just at McDonald's and the ice cream machine was broken and it seems like it always is. Is the ice cream machine
broken here very often? - [Wendy's Attendant] No. Yeah. That's what McDonald's problem. We wash our machines every single-- - Oh, that's cool. Is it easy to do that or
is it pretty complicated? - [Wendy's Attendant] No,
it's actually really easy to clean it. They're just lazy. (Johnny laughing) It's the honest truth. That's the honest truth. - So, Wendy's doesn't have this problem. And what's crazy is that they
use the same brand of machine as McDonald's does, and yet
they don't have a McBroken. It's not an internet
meme for them, nor is it for other places that use the
same brand of ice cream maker, like In-N-Out or Chick-fil-A
or a bunch of others. So, why is it only
McDonald's that has a problem with the broken ice cream maker? - [Attendant] That's
only a McDonald's thing. We don't have that issue. - You don't have that issue here. - [Attendant] I promise. (Johnny laughing) (gentle music) - If you want a real answer on this, you need to talk to the
people who suffer the most when these machines' broken, which actually isn't McDonald's corporate, it's the people who own
these individual restaurants or franchises. These are the people who pay the price in lost revenue, when
the machine is broken. So I talk to them. I talked to managers who actually
deal with broken machines and I also went deep in this
111 page owner's manual, which is not a read I recommend but I will summarize what it says. (gentle upbeat music) What I've found is as mind
boggling as it is infuriating. To understand this, you have to understand how these ice cream machines
work, and why they break. So I ask you to bear with me as we learn how an ice cream machine at McDonald's works, and
why they always break. Once you understand that you will understand who is
getting rich every time one of these things breaks, and why they have an
incentive to keep them broken. (bright hiphop music) - And I was like, "Okay. I'm gonna guess it's
gonna be around like 5%. And it came back to like
13%, which is insane. - One question that needs to be asked is, "Should you be building
ice cream machines, if after 17 years you still
can't get the software right?" (hiphop music) - [Wendy's Attendant] No. Yeah,
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McDonald's ice cream makers. If somebody said, I have
a product that 10% or 12% of the time, it's not functioning from an interest standard standpoint, what does it look like? - That's not good at all. Being down for 10% all the time, that's like, no, you can't do that. - So, let's look at the
machine in question here. It's this guy, the C602. It's made by a company called Taylor. This machine is made
specifically for McDonald's. Taylor is like an OG
partner at McDonald's. They've been doing business together since the very beginning of McDonald's. They're both based like a few miles away from each other in Illinois. They are old business
partners going back decades. But like I said, Taylor makes
ice cream machines for a bunch of other fast food restaurants
like Wendy and Chick-fil-A, and those machines aren't
broken all the time. So it's something very specific
to McDonald's and Taylor that explains the ice cream machine issue. If you wanna start a McDonald's franchise, you sign an agreement with McDonald's corporate that says, "I'm gonna open a restaurant and I'll make sure that
everything is standardized." It's a part of this
agreement that says you have to use this kind of French fry and you have to use one
of two different companies for your fryer and your grill or whatever. When this new ice cream
machine came out in 2003, McDonald's had it in their agreement with all their franchises,
which is like 16,000 in the United States, that
they had to use this machine. No other machine. They could not use any
other machine on the planet, They had to use the C602 made
by McDonald's and Taylor. It was in their agreement. Usually franchisees can pick between multiple different companies for their gear in their store. Not in this case, you had to use the C602. So, let's dive into this machine. (hiphop music) Ice cream is dairy, and dairy needs to be kept at a certain temperature to stay safe. The machine itself has all these
pipes that have dairy going through it all the time. So what they do once
per day is they heat up the whole machine, including
the ice cream mixture to like 151 degrees Fahrenheit. They leave it at that
temperature for awhile, while it kills off all the bacteria, and then it comes back down
to a freezing temperature where it turns into ice cream. That process takes about four hours. And this is the thing that
you hear about all the time as the explanation for why
the machine is always down. (gentle music) But here's the nuance here
that really illuminates the story. Usually, the employees do this overnight, while the store is closed. Someone in the night shift
gets the cleaning cycle going, and then they lock up for the night. The next morning, new employees who are opening
the store for the morning, show up, and they look
at the ice cream machine. And on the screen, they
usually see one of two things. "Heat cycle was successful." The ice cream machine is ready to use. Or, "Heat cycle failed." They don't know exactly why the
heat cycle failed overnight, they're looking at this
interface that looks like it's from like 1983, and all they see is something like, "Heat mode failure," or some other obscure code that doesn't really
tell you what happened. The machine is completely locked out until you successfully run
one of these heat cycles. You have to run heat cycle. Even if the heat cycle missed one of these benchmarks by like one degree, it's still just gonna
tell you the thing failed. Doesn't tell you why or by how much. So the employee tells their manager, the manager has no idea
why the heat cycle failed, and so they just tell
their employee to like, "Run it again." Luckily it's the morning, so, people aren't getting ice cream yet, but like run the heat cycle again. So, employee runs the heat
cycle again and it fails again, probably for the same reason
it failed in the first place, which nobody knows at this point. PS, as a C602 ice cream machine insider, the reason why it failed
probably is because the hopper is a little bit too full of the ice cream mix and it takes a while for
it to heat up and cool down that massive matter. So, just fill it a little
bit less next time. That's one of many
reasons why it might fail. Anyway, nobody knows this, because they're just sitting there trying to serve customers. I worked in fast food in high school, it's a chaotic world. You're just trying to make people happy. Meanwhile, the person's trying
to like run the heat cycle, it fails again. So the heat cycle fails again. Manager's pissed, you have angry people asking for ice cream and everyone's just saying like, "Yeah, the ice cream machines down. Sorry, we can't do anything about it." So, finally, the manager
calls the franchise owner, the owner of the business and says, "What do we do?" And the franchise owner says, "We need to get ice cream sales going. This is not okay. We're losing money. Just call the guy." (suspenseful music) Just call the guy. That's verbatim, what one of the franchise owners told me. He said, "When things are crazy I just tell them to just call the guy." Now we're getting to the heart of this. The guy in this case
means one guy or woman, which is an authorized service
technician from Taylor, the company who makes the machine. Remember this? - [Male Attendant] The ice cream machine isn't working right now. (dramatic music) - No, I'm just hear here to
fix the ice cream machine. - Okay. - You're from Taylor? - Yes. - Okay, 'cause I've
never seen with a uniform that why I'm a little bit-- - Okay. Yeah. I always switch things up. - Oh. So you're still Taylor? - Yes ma'am. - Okay. - Turns out that Taylor is the only company that
is authorized to repair and maintain these machines. It's in their contract. If you call anyone else, but Taylor, first off they wouldn't know how to use it 'cause it's such a
strange esoteric machine, but also you would void your
contract, your warranty. So you call the service technician, he or she comes to fix the machine. We got our hands on some actual invoices that show how much these
Taylor repair people cost. It's different in every
market and for every scenario but somewhere to the tune of
$144 for the first 30 minutes. And then up to hundreds of dollars for each additional 15 minutes thereafter. So the desperate franchise owner, the one who runs the
business has to decide, "Do I deal with angry
customers who are yelling at me 'cause they don't have ice
cream, or do I just call the guy and get them to come
repair this at any cost? It doesn't matter." So these franchise owners end up paying thousands
and thousands of dollars, not because their employees are competent, or they're bad at training, but because this machine locks them out and they have no idea why. They're looking at a screen
that looks like this, and all roads point to, "Call the service technician." I watched a bunch of
advertisements for Taylor company, people who make this ice cream machine and do all the maintenance on it, they hardly talk about their product here. Their advertisements are more about how great their repairs team is. - [Advertiser] Innovators
don't build machines. They solve problems. This is an expert technician. There are 6,500 Taylor
technicians worldwide ready to help you. The Taylor company! (upbeat music) - A few years ago, Taylor
was in talks to be acquired by another company called Middleby. They put together a pitch
deck of all their financials to sort of say, like, "Look at how good our business is." And on that pitch deck, they stated that 25%
of their revenue comes from this repair and parts
service of their business. Yes, they make ice cream machines, but a quarter of their business comes from just maintenance and repairs. This sort of reoccurring revenue, revenue you can rely on month after month, is like gold for investors. People love this because this is like, you can project how much money
you're gonna get every month, if you can rely on a
certain channel of revenue in your business. Taylor can rely on services and repairs from McDonald's ice cream machines. Remember, up until just
a couple of years ago, for years and years, McDonald's franchises were only allowed to use Taylor machines. They had no options. They couldn't be like, "Wow, this machine sucks. I'm gonna go somewhere else." So they had to use the machines, regardless, and they had to use this specific machine that breaks all of the time. - [Taylor Advertiser] Their
parts and service network, is what makes Taylor the company of choice for the food service industry. - No matter what time of the (beep) day the ice machine is broke. How? - [Mom] McDonald's is making my baby cry. - How? - We got our hands on
the software for some of these machines, to see how Taylor has tried to improve the software component. You would imagine that with a machine that is
notoriously broken all the time, it would update their software
to give more useful feedback to the user like, "Hey your cleaning cycle failed last night only by one degree, and that's probably because
your hopper was too full. Try to fill it a little
bit less next time." Alas. No. Since 2003, when this thing came out there have been quite
a few software updates. But instead of improving
usability of the software, the software has actually
introduced just new sets of cryptic error codes that don't help anyone solve any problems. I have spent hours in
this instruction manual going through all of the error
codes and what they mean. I feel like maybe just maybe, after reading this multiple
times and like being in the weeds, I could
operate one of these machines and maybe understand what's
going on when things fail. But it is clear to me that
this machine is not set up for the user to have success in diagnosing and fixing the problem. One person I was talking to was like, they had just opened a store and they, it was a brand new store,
a brand new machine. And they're like, "Yeah, in the first few months we called the guy like
four or five times." (chuckling) I am blown away that a product like this, with software this cryptic and horrible, can exist in 2021. The menus are horribly complicated. The error codes are not helpful. The buttons don't have words on them, instead they're just
like a bunch of symbols. Like it's like press the flavor button, press the ice cream button. To get to here, like to access this menu, press these two buttons at the same time. It's like, "How could you ever expect somebody, especially like an entry-level employee, who's been on the job for like a few days to understand any of this." It is a product that is set up to fail and that has no incentive to improve, because what this means for Taylor is simply more services and
repairs for their pocket. 25% of their entire
business is based on this. And then there's the secret menu. (bright hiphop music) In addition to the instruction
manual that's given to users, I also got a hold of the service manual that is given to the Taylor service people; like this is like the insider manual that gives you the whole
picture on this machine. I do not recommend you read it. In this manual, you learn about a separate menu
for the service technicians. It's called the Service Menu. This one is not accessible to the user; the person who owns the
machine, the franchise owner. It's only accessible to the service techs who have
very specific code for it. The existence of this
service menu is found nowhere in the user manual; the thing given to the
person who owns the machine. And yet, according to this
manual, this menu contains quote, "Critical operating
parameters for the machine." So wait, if this machine is breaking all of the time and you have a franchise owner who's trying to keep
their customers happy, and there's a menu where there are quote, "Critical operating parameters," that the owner doesn't have access to, just call the guy. Just call the guy. The machine is not meant to
give the user a clear picture on why it's breaking. A few weeks ago, a Taylor
service technician realized that he was required to install
this new software update on all McDonald's machines. He noticed that the update had a bunch of weird new error codes
that made the machine worse and less functional. So he posted a video about it asking for help from
other service technicians. Shortly after he posted the video, the video disappeared. When asked what happened,
he responded with quote, "The system defeated me." He was clearly told to
take the video down. Somebody doesn't want this
sort of thing on the internet. Now listen, this isn't some conspiracy. There's all sorts of weird conspiracies around the ice cream machines, this isn't one of those. This is actually very rational
human and business behavior. When one has a monopoly
over ice cream makers and they've created a
particularly (beep) product that breaks all the time and gives users no clear
feedback as to why it's broken, this company has no incentive to improve. In an open market, the incentive to make your product better comes from competition and comes from basically ramifications. You'll be driven out of business if you don't make a good product. In this case, that's not the dynamic. And in fact, having a bad
product is incentivized because it means more money
in services and repairs for this business. And the reason why McDonald's
corporate is okay with that is because the cost isn't born by them. It's born by local franchise
owners who have to pay for services and repairs. Taylor has the capacity to make and improve ice cream makers. They do that all the time at Wendy's, and Chick-fil-A, and In-N-Out. And yet the machine made for
their OG exclusive partner, McDonald's, doesn't receive
the same improvement and refinement. Instead it receives a bunch of new error codes and
terrible user experience, which always leads to "Call the guy." One franchise owner I talked to said, "All roads lead to, call the technician." Like this product is designed to get you to call the technician. At this moment, as I'm talking to you, 15% of all ice cream machines
in the US are down. The standard for most industrial products is that you have less
than a 1% failure rate for your product. In fact, the real target for mass industrial products is 99.99966% of the time your product is working. That means 3.14 errors for
every 1 million opportunities. What you're seeing here with
15% is a dismal failure. And this is the product of no pressure or no incentive to improve. And in fact, a perverse
incentive to keep it (beep) The last chapter of this story is the one that is still developing today. And it has to do with the email I got a few months ago from somebody who's deep in the middle of this. I'm gonna lay out some facts here. I'm gonna let the news play out
over coming weeks and months to see how this happens, but here's what's going on. The guy who reached out to me originally was someone named Jeremy,
who is a tech entrepreneur. He invented a product that
could basically fix this problem of like terrible feedback to the user of these ice cream machines. It's this device that you plug into your ice cream maker and it connects with your phone and it
gives you solid reporting on all the things happening
in your ice cream machine. Something that this does not do. And it identifies like actionable things that you can do, to train your employees to make sure that the
problem doesn't happen again. Basically, it avoids this
happening in the first place and avoid you needing to
'call the guy' all the time. As soon as Jeremy launched this product it was a smashing hit
with franchise owners. They started selling hundreds of these things to franchises
all across the country. - [Reporter] People Magazine, reports the chain has
partnered with Kytch, a company that created
technology to help employees manage the machines and reduce downtime. - The franchise owners I talked to said that instead of getting
these vague error codes, now they actually get like solid reporting on what is happening inside this machine, and they can like train their
employees to help avoid this. Now lemme just caveat for a second. Jeremy and his company Kytch, obviously have a big
financial stake in this story. I'm aware that he reached
out to me and gave me some of his data and that
there's a big conflict of interest in terms of
like neutral journalism and my informant being somebody who stands to gain a lot of money, if this story comes to life. And that's why this story
has taken me literally months to report. I've had to go through
and independently report and verify every single thing
that Jeremy has told me. Hence this. (groaning sounds) So, yes, while there is a major
stake for Jeremy and Kytch for this story and for
exactly what I'm saying here, the fact is everything that I've said here checks out on my own
independent reporting. Just let that be known. Okay. So Kytch got so popular
among franchise owners that at this conference where
all the franchise owners got together late last
year to have a conference to talk about McDonald's things, sounds like a riveting conference, the head of this organization of franchise owners gets up and says, - Now this is no silver
bullet, but it's my belief that the information it
provides increases awareness and results in faster reaction times when a problem does occur. Now, to be clear, this is not a McDonald's
approved piece of equipment. - I mean, he sort of like endorsed it. He was like, "This is a sweet product. It's actually helping us out." Soon after this endorsement,
McDonald's sends an email to all of its franchises that
says that they've determined that Kytch is actually super dangerous. It may cause serious safety
risks, and they recommend that the franchise owners stop using it, saying that they will void
their warranty if they do. Wait, what? So you have this device that is clearly solving a major problem, and instead of being like, "Whoa, tell us more about this. Let's see if we can get this like approved and put it into more shops," they blacklist it. And they scare away a
bunch of their franchisees from using it. I reached out to McDonald's directly
to ask them point blank, "Like WTF? Why are you blacklisting
a product that has the potential to solve this problem that you get made fun of all
the time on the internet for?" They came back to me with
some boiler plate PR language about being committed to their
customers and all this stuff, being able to buy sweet
treats and all this. And then this little nugget
at the end where they say that McDonald's is testing
a connectivity solution with an approved McDonald's supplier. In other words, McDonald's is working on a product that does
exactly the same thing. Oh, and the company that they're using to do this is called
Powerhouse Dynamics, who is, wait for it, owned by the
same company that owns Taylor. They're under the same parent company, Taylor and Powerhouse Dynamics. They're keeping it in the family. Oh, and this device, the new
one that they're testing out, doesn't give the full picture to the user. It continues to block them
out of certain aspects of the machine that could be useful in diagnosing why the
machine is always broken. The theme here is the same. It has been the whole time. Two old companies that
have been working together for a long time, looking out for each other
and keeping control over data so that they can save their own necks from being disrupted by new tech. That is like a story, like
that is as old as time, and it is happening right here in a potentially collusionary way. Again, is this a deep conspiracy? Is there like secret
backdoor deals going on? No, this is actually horribly predictable. What this is, is old
companies who are afraid of being disrupted by
smarter, better products, doing whatever they can to hold on to their share of the market. This new connectivity product
that McDonald's mentioned to me, basically does
the same thing as Kytch. But this new device doesn't
actually give the full picture. It still blocks the user out
of those things that have been behind the technician's secret menu. The things that the user manual
itself says are critical. It's the same old story
of keeping tight control over what data and
experience the user has, so that they can continue to maintain their exclusive relationship with services and repairs,
which is 25% of their business. It's honestly smart, shrewd,
cutthroat, business behavior. But you know who it hurts? It hurts the franchisees and it hurts all of us who
wanna go buy McFlurries. This is anti-competitive behavior. Trying to squash new products in the name of retaining control. So, there's a lot of nuance here that I've sort of blasted
through very quickly, but the upshot is that
McDonald's ice cream makers are broken more than everyone
else's ice cream makers, even though they're made
by the same company, because the company that makes them has no incentive to improve, and in fact has an
incentive to keep them bad. Over the years, they've done a terrible job
improving their software, and they've kept employees,
managers, and franchisees in the dark of what's actually going on with their ice cream maker, preventing them from actually being able to fix it themselves. And when finally someone comes with a product that could actually fix it, they squash it in the
name of their own product that does sort of a worse version of what that new product was going to do. Kytch is suing McDonald's
for a bunch of stuff. Go read into the lawsuit if you'd like. And certainly in coming months,
we will learn the details of exactly how this is all going down. But for now next time you're at McDonald's and they
don't have ice cream, just know that it's not
because of lazy employees, it's not because of lack of training, it's because there's an old relationship between two old companies that
don't want things to change.
TLDW:
I worked at McDonalds back in the late 80s. Our machines rarely broke at that time, but we told customers the machine was down every evening because there was a fairly lengthy disassembly and sterilization procedure that had to be done nightly. We would start that a few hours early so we had as much of the closing stuff done before we actually closed the store.
Wonder who's machines Dairy Queen uses?
Put the same amount of time into the Wired article on this subject, and learn more.
https://archive.is/xzYL8
I haven't worked at McDonalds since 1995, but I would bet money I can break down and reassemble the shake and cone machines from that era in less than an hour. You're still going to need to wait a few hours for the mix to get down to servinig temperature, but there were no codes in those days. There were, however, a lot of o-rings and lube.
I think the video does a good job at explaining the nuances, but I think it misses one very important question: why does McDonalds continue to keep the exclusive relationship with Taylor, despite the garbage they’ve been selling their franchise owners?
Loyalty to an old buddy is definitely not the answer. Corporations like this don’t give a shit about loyalty. The only rationale I could think of is that McDonalds is guaranteed to be getting some kind of a financial reward for maintaining this relationship. That could be in the form Of McDonalds corporate having a stake in Taylor (or Middleby, the parent company) profits, or McDonalds is getting a discount on the backs of these service calls.
Like a fast food burger, this video is really digestible but full of a lot of filler.
Curious if this only happens in the US. Have never come across a broken McDonald's ice cream machine when traveling abroad.
Didn't that shane guy get canceled.