Apple and the Media’s Death Wish
November 27th, 2014Typical of any publicly-traded corporation, Apple’s stock price has had its ups and downs. This reminds me of the time I met a friend, his name is Mark, at the Macworld Expo in San Francisco. He accompanied me and my son, Grayson, to the Steve Jobs keynote. My press pass accommodated extra “helpers.”
After experiencing the famous Steve Jobs “reality distortion field,” Mark called his stock broker and ordered up a few hundred thousand dollars worth of Apple stock, which were trading for over $23 a share at the time. He said he sold it some months later for a decent profit. But imagine if he hung onto that investment for the full decade. Don’t forget the recent seven-for-one stock split. His investment would have appreciated nearly 35 times over the original purchase price. His stash of Apple stock would be worth millions.
Regardless, there is the delusion these days that Apple’s stock price didn’t actually crater until after Tim Cook took over as CEO. But if you examine the trends, that is just not so.
But the media often considers only the most recent stock price slide that began after the iPhone 5 shipped in 2012. Despite record sales of five million units on the launch weekend, tech and financial analysts insisted Apple must sell up to 10 million, thus the results were erroneously perceived as disappointing. It didn’t matter that Apple couldn’t meet demand. Maybe they should have built phantom smartphones or something.
Over the next few months, there were published reports claiming that Apple had reduced orders for iPhone 5 components, thus creating the impression of poor demand despite record sales.
In the next quarterly conference call with financial analysts, Cook said you cannot gauge sales from isolated supply chain metrics. This ought to have been obvious to anyone who pretends to understand the tech industry. Besides, it’s normal for a company to reduce orders after the holiday quarter, since sales would naturally be expected to decline for most consumer products. That’s only logical.
But logic and reason didn’t calm the market, and Apple’s stock price continued to dive from record levels. At the same time, some members of the media demanded Cook’s head. They said he wasn’t up to the job. He was a supply chain geek and not the visionary who could step into the shoes of Steve Jobs and keep Apple running.
They seemed to forget that Cook had worked at Apple since the 1990s, and had stepped in for Steve Jobs several times when Apple’s co-founder took sick leaves. Maybe he wasn’t quite the product visionary, but he had other talents, and Apple had a smart executive bench to handle the other chores. Remember that Jobs wasn’t a supply chain wizard; he had to hire someone else to get that job done.
Apple’s perceived roller coaster ride didn’t end. Any time sometimes inflated revenue and profit estimates were missed, or appeared to have been missed. Apple got hit between the eyes.
Now Jobs famously told Cook before the former’s death not to ask what his predecessor might do, but to move forward and do what he thought was right. That didn’t stop the media from assuming that Jobs would have acted differently when it came to various product and strategy moves. So Jobs would never have approved production of an iPad mini, since he denigrated small tablets. But that skepticism once applied to mobile phones before the iPhone was launched. Jobs was famous for attacking a product one day and launching Apple’s version the next.
I remember when Apple executives said they’d never build a cheap Mac in late 2004. The following January, they introduced the $499 Mac mini. What’s more, Steve Jobs reportedly didn’t exactly jump at the opportunity to produce the iPod when the concept was first brought to him. He often attacked an idea only to embrace it later on.
In short, there is no way to predict how he might have reacted to any decisions Tim Cook has made. That Cook has made the company more open may seem anathema to the Jobs approach, but things change, and making predictions is a fool’s errand.
These days the demands that Cook be dismissed are no longer as loud.
On the other hand, while Apple reports record revenues, and the market cap is now hovering in the $700 range ahead of Thanksgiving, one online publication has tried to make hay of the company’s perceived recent failures, referring to them collectively as another “tech turkey.” So non-original.
Consider the fact that a number of entertainers with iCloud accounts were hacked, and their explicit photos revealed, is attributed to Apple’s failure. But Apple made it clear at the time, and the statement has not been disproven, that those compromised accounts were hacked by the usual methods, such as guessing usernames and passwords. It doesn’t mean Apple couldn’t make their systems more secure, and they did expand two-factor authentication capabilities. But that doesn’t let the victims off the hook. Knowing they were targets, they should have been more careful in their online behavior.
Apple continues to be blamed for the abortive iOS 8.0.1 update that killed cellular access and Touch ID on 40,000 new iPhones. Remember that Apple is not the only company to have issued a faulty software update, and it was withdrawn in a little over an hour. The fix came out the very next day, and those impacted were given simple online instructions on how to restore their gear.
So, yes, Apple has goofed from time to time, but don’t tell me Google and Microsoft are perfect.
Still, Apple is huge, and even a minor failure or perceived failure must be a big deal, particularly for people who wish Apple would just go away.
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