For the longest time, Apple have been considered one of the corporate good guys in the eyes of progressive political types. They were the little guy who put computers in elementary and middle schools for kids to learn about. They were the anti-Microsoft company in the 90s when Microsoft was threatening to take over the computing world. The Mac vs. PC commercials several years ago also gave the perception that Apple was the good guy. Steve Jobs was seen as a progressive genius. The iPod, iPhone, and iPad were and are artistic works of beauty. Even Al Gore is on the board of directors, and his slips of releasing iPhone secrets were seen as charming. The Occupy Wall Street folks will protest banks, wireless companies, and other evil businesses but they do not protest Apple. As a matter of fact, they use their iPhones and iPads as tools to get their message out.
But is the era of Apple as a corporate good guy over? Recent evidence suggests that the death of Steve Jobs has opened the door for critics to start attacking Apple. On a number of levels, Apple is starting to feel the heat. Some examples:
(1) Apple’s China Syndrome: The iPhones and iPads are completely assembled for the most part at Apple’s Foxconn facilities in China. Recent problems at these facilities, including suicides, deadly fires, overworked employees, underage workers, and poor working conditions have come to light. Apple has been stung by these accusations and has tried to diffuse the situation by asking a Independent Labor Agency to come in and report on Foxconn’s conditions. Initial positive reviews have given the impression that the Agency is trying to run interference for Apple. In addition, Apple is locked in a dispute with a Chinese electronic provider called Proview over the naming rights to iPad. A ruling in favor of Proview last year may allow Proview not just to block selling distribution of iPads in China but also block shipping of iPads out of China to the rest of the world. Also, there have been riots and protests at Apple stores in China for various reasons including the Foxconn situation.
(2) Apple is now king of the (technology) world: Thanks to the Mac, iPod, iPhone, and iPad, Apple is now unofficially the king of computer technology. Microsoft and Intel is struggling or non-existent in the Tablet and Cell Phone World. Other companies can’t match Apple in Computers, Tablets, or MP3 players. The only companies worldwide that could come close to matching Apple’s dominance would be Samsung or Sony at this point. Apple was once the little guy; now they are about as big as ExxonMobil and are worth more money than many European countries. How will they handle being the top dog?
(3) Media now no longer afraid to criticize Apple… and Apple is losing the PR battle. When Steve Jobs was in charge, Apple enjoyed a good relationship with the media. When Jobs passed away, many people who were silent critics for fear of Jobs’ vindictiveness; after his death, they now feel empowered to openly go after Apple again. And they are not alone: The New York Times in their investigation of Foxconn is probably using Apple as the path to a Pulitzer… and new CEO Tim Cook is not happy about it. He has openly rebuked the NYT about their reporting, and many Apple officials are starting to no longer comment on stories to the Gray Lady. Also, consider the world of commercials as well. Remember the Mac vs. PC commercials Apple once produced? Well, the tables are now turning. Consider Samsung’s recent commercial making fun of the iPhone while touting the Galaxy S II smartphone.
(4) Tim Cook should be on the Occupiers’ Target Radar. For serving 5 months as CEO of Apple in 2011, Tim Cook earned $378 million dollars worth of financial benefits to be the top paying CEO… $376 million of that alone was in 1 million shares of restricted stock (now worth nearly $500 million). Consider Steve Jobs when he died only had 5.5 million shares. His base salary in 2012 is $1.4 million. Consider when he was CEO, Steve Jobs once famously had a salary of $1 for a year. Now, the Apple CEO gets really paid.
(5) Apple is starting to fall behind the wireless technology curve. To be fair, Apple has never really been a wireless tech leader with their iPhone or iPad. The first iPhone was based on GSM, and after initial criticism, Apple’s apps overcame the technology deficiency. But 4G LTE has become a popular buzzword in the smartphone world and even though the tech has one chief drawback—battery life—the smartphones and tablets are all claiming 4G LTE as the salvation of the smartphone with WiFi as an offloading capability. If the iPad3 and iPhone5 don’t have LTE technology in their devices, Apple will pay a price in terms of sales.
(6) Apple may no longer be intimidating Network Providers. Even as late as last year, Apple was able to strong arm Network Providers into carrying their devices (see the Sprint deal where Sprint agreed to buy 30 million iPhones over 5 years). But Network Providers are not getting as much profit for selling the iPhone as they want because they have to heavily subsidize it. AT&T and Verizon may balk at selling iPhones in the future because of how much it hurts the bottom line.
Of course, Apple is still not done developing new things. iTV could make its debut later this year, the iCar is on the drawing board, and who knows what else Apple has up their sleeve. With $100 billion of cash on hand, Apple has the opportunity to do anything and they have 4 years of products in the pipeline to keep them going in the short run. But that could be a problem in of itself. If Apple tries to get involved in everything, it could invite additional Apple enemies down the road. And if Apple stops innovating, that’s another problem.
In short, the days of Apple being the corporate “good guys” are over. Just how far Apple turns to the Corporate dark side has yet to be seen. Tim Cook’s turn as Apple CEO will do a lot to answer that question. But don’t be surprised if politicians and OWS forces begin to increase their venom on Apple soon. Maybe even Al Gore himself will start blasting the company that put him on their Board of Directors.
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