Design October 7, 2009, 12:43PM EST

Dean Kamen Reinvents Coke's Soda Fountain

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Inventor Dean Kamen has segued to helping Coke with its new drink dispenser. Coca-Cola

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Instant Feedback Could Boost Sales

From Coca-Cola's perspective, the cartridge-based system, for which Coke holds 30 patents, offers several advantages over conventional fountains, which mix pre-made syrup with carbonated water. For instance, the syrup is stored in five-gallon bags that are more expensive to ship and bulky to store.

Whether it's the greater number of choices, the possibility to customize, taste—Farrell insists that these "freshly made" sodas taste better than syrup-based versions—or sheer novelty, retailers testing the Freestyle have reported double-digit increases in beverage sales.

Another advantage: The digital fountains uses wireless communication to constantly report business data back to Coca-Cola headquarters, where marketers can view sales by brand, location, and section of the day. "It's a tremendous new tool for understanding how customers consume our products," says Farrell. He could know, for instance, that while Caffeine-Free Diet Coke ranked a ho-hum 12th in overall sales at a fast-casual burrito joint in Los Angeles, it was the No. 3 afternoon drink.

The platform also allows Coca-Cola to quickly test or roll out new products. "UPS a cartridge to a [retail] customer, download some software to the machine, and within days we could have data on how and where it's selling," says Farrell.

You won't find the Freestyle in every McDonald's anytime soon, but Farrell sees the new fountain as "the biggest single innovation initiative" in the company's history, not least because Coca-Cola owns most of the technology. "We share some patents with our partners and a couple are licensed from Dean, but most we own outright," he says.

Kamen was paid an undisclosed fee, and he may have strengthened Coke's commitment to FIRST. But most important to Kamen is leveraging Coca-Cola's global beverage distribution system for his dream of—"figuring out how to get clean water to every kid in the world," he says.

For years, DEKA has been working on an innovative water-purification machine. And for years, Kamen has been talking about it to people at the United Nations and various non-governmental organizations. "But we realized the NGOs aren't the ones who can help us get the machine into production, scale it up, bring down the cost curve," says Kamen. Which is where the biggest beverage maker on the planet comes in.

The clean-water technology hasn't been integrated into the beta version of Freestyle and might never be. "That's still one of Dean's dreams," says Coca-Cola spokesman Ray Crockett.

But Kamen's fantasy does align with the company in one way: Coca-Cola's business depends on clean water—the single biggest ingredient in the company's products. "We think there is vast opportunity to improve the quality of water around the world and even in the U.S.," says Farrell.

Jessie Scanlon is the senior writer for Innovation & Design at BusinessWeek, where she covers the intersection of design and business.