Apple’s Totally-But-Not-Really Botched Press Conference

Last Friday, Apple gracefully told the gathered press to go suck it. A quick recap of what happened in the month since the iPhone 4 went on sale:

First, the online media started going on the fritz, mindlessly propagating stories about the iPhone 4 having some supposed “major defect” in its hardware design which, unlike any phone before it, featured the antennas as part of the bezel, and the very frame of the phone itself. One aspect of this design involved a small strip which, when bridged with a finger or palm, would attenuate the received signal so visibly it was dubbed the “death grip.” Whilst I could re-enact a visible (but marginal) signal loss on my iPhone 4 when gripping it that way, my overall experience with the phone’s signal quality was better than I was used to with my iPhone 3GS.

Apple, for their part, didn’t do a great job in responding to the initial bit of backlash, with a reported e-mail from Steve Jobs to a customer saying “just don’t hold it that way.” This and a few other things did not please the already-frustrated customers that were affected, which, it should be noted, was not an insignificant number, but nothing even remotely near the press-suggested “majority of customers.” I myself had no issues, but I was nonetheless disappointed in how Apple were treating the problem.

Then the Consumer Reports review of the iPhone 4 came out, putting it smack dab at the top of their list of smartphones, but saying they couldn’t recommend it ”due to the antenna issue.” At that point, Apple announced a press conference, to be held at the end of last week. Finally something of an acknowledgement of the problem being real. With baited breath the press waited and listened, only to have Jobs tell them they should have done their jobs better. “All smartphones have this problem,” he hammered down their throats. “Again, if you look at hard data, only a tiny percentage of customers is reporting the problem,” he reiterated.

If you ask me, Jobs was as much frustrated with the poor quality of reporting on this issue for the full four weeks since launch, as he was with the antenna problem itself. His remarks at the D8 Conference about how “we need editorial oversight now more than ever” also spring to mind.

And it’s hard to blame him, when even Dan “Fake Steve” Lyons writes a patently incorrect observation:

Part 1: There is no problem. Part 2: Even though there is no problem, we’re going to give everyone a free case, which should insulate the antenna and prevent the interference that we just told you isn’t actually occurring. But if you’re still not happy, you can give back the phone for a full refund. Jobs’s snotty tone made it clear that he was pretty fed up with all the whining about a problem that he says doesn’t exist.

Hey Dan, how about you watch the whole press conference, but this time pay attention? Nowhere in the 28 minutes does Jobs claim the problem “doesn’t exist,” he only points out (at aggravatingly great length) that the problem isn’t unique to the iPhone 4.

Judging the responses on Twitter from people actually suffering from problems with their iPhone 4—and even those who don’t—the impression I get is that customers are pleased with the offer of a free case of their choosing, and a full refund if that still does not fix the problem in a satisfactory way. Who aren’t happy with Apple right now?

The press.

Because they got scolded. They got put down by Jobs like a bunch of middle schoolers that got too unruly whilst the teacher was away for a moment. They were schooled by Jobs, and they took it personal. Understandable, because hardly all of them jumped the “death grip” bandwagon without doing proper reporting, but it’s hard to express much sympathy for me—I don’t recall any of them interjecting a voice of reason or sense anywhere. The one I have seen is from the day of Apple’s press conference, a piece by Eric Zeman on Samsung’s announcement of the Galaxy S Android phone.

Leave it up to a tech blog to get some feedback regarding proper real-world usage. The outcome? It’s much better when the signal is decent or greater, and troubling when the signal is anything below decent. Furthermore, the (free) case will fix the antenna attenuation issue entirely, leaving only the proximity sensor problem that needs urgent fixing.

So anyway, what was so botched about Apple’s press conference? I have no idea, to be honest. It struck me as very standard-fare Apple practices on every level: Step 1: deflate the severity of the issue that the press is hyping up to be much bigger than it is. Step 2: offer customers a solution that should please all but the nastiest of naysayers. Step 3: produce marketing pages to further showcase Apple’s dedication to the product(s) in question.

Not so, says Shel Holtz, who argues that Apple did everything wrong about this crisis management:

  • Treat perceptions as fact—Jobs insists there’s really no problem
  • Acknowledge mistakes—Jobs insists Apple has made no mistake
  • Tailor messages to address the aggrieved or angry party—The message to the aggrieved parties: “There’s really nothing wrong with your phones that isn’t wrong with all phones”
  • Note the other side’s concerns; don’t be dismissive—“Dismissive” characterizes Jobs’ remarks
  • Make no public confrontations—Jobs took on every other cell phone manufacturer

Well, aside of being wrong on his first two claims (Jobs insisted neither of those things), Holtz clearly wants Apple to play by a set of rules that Apple didn’t come up with on their own. And that was his fundamental mistake: his attempt at compartmentalizing Apple as just a company like so many others.

For more than a decade now, companies making products similar to Apple’s have tried to compete, and for just as long they have failed to really do so. These competitors have all bitten the dust left by Apple’s wake, trying to mimic Apple’s approach while at the same time playing things by the book. Here’s a clue to them: don’t do that. Apple plays by its own book, and if you wish to compete, you need to invent your own book as well. Google is somewhat starting to get that, but so far their book contains few recipes for taste.

Throughout that past decade, journalists and bloggers have complained that Apple doesn’t do this right or that right, or that they should’ve done this instead, or that, or whatever. Meanwhile, none of them have accomplished what Apple has accomplished under Jobs: revived themselves from near-bankruptcy, returned to profitability, entered and subsequently dominated established markets, and even create entirely new markets—and all the while making ever-increasing profits.

Now, don’t misunderstand me: there are plenty of things to criticize Apple for, but claiming they’re doing things wrong is laughable at best. For three years in a row, Apple is the most admired company in the world. Its core products usually top the customer satisfaction ratings in their respective categories, often with a big lead over the #2 product. It’s gone from being “beleaguered” to being the #2 company in the United States in terms of market capitalization. They’ve made mistakes along the way, true enough, but if you think they rush a product to market without a solid strategy you’re only putting ignorance on display.

Here’s the thing: what would happen if Apple admitted to a “mistake”? The press would make an even bigger hoopla out of it, and no doubt a costly legal suit would follow—resulting in the exact same outcome Apple have already given us: free bumpers or a full refund for your phone if the bumper is not enough. There is no way in hell that a full product recall would happen, simply because there is no hugely-widespread issue. A recall would be extremely costly, deprive people of the phone that by far most of them love and use each day, and the only people satisfied by it would be the press that gets to smugly write on their blogs “I told you so.” And I cannot stress this next point enough, so I’m writing it in bold on a separate line:

Customers’ needs would not be served by Apple admitting to a mistake.

Some people, including Holtz, claim that Apple does not really love its customers, but they’re asking Apple to do something that wouldn’t actually benefit those customers. They’re asking Apple to do something only so that they themselves can feel a sense of superiority for a change, rather than acknowledging that Apple is frustratingly often right about things.

By not admitting to a mistake, Apple has: kept a huge expense at bay; kept themselves able to solve their customers’ problems at minimal cost; and upheld the idea (in consumer mindshare, at least) that iPhone 4 is the best smartphone on the market today.

So please, how did they handle this crisis poorly again?

I suspect the crisis will fizzle out over the course of the next few weeks, once people start getting their free bumpers or refunds. Not everyone will be satisfied with this “fix”, but provided Apple in the meantime fixes the proximity sensor issue, reports of continued dropped calls will dwindle and the media (Gizmodo excluded) will move on to more interesting stories. I guess time will tell if I’m right on this or not.

The other angry crowd

I want to return to an earlier point briefly, as there is another group of people that hasn’t been happy with the outcome of Apple’s press conference: competing smartphone manufacturers.

Most notable are RIM—Research In Motion, makers of the Blackberry—and Nokia, who both issued press releases responding to Apple’s event. RIM’s co-CEOs seemed particularly vexed, pulling as many punches as possible without appearing petulant or juvenile. Let’s take a look at why they are so angry, and by that I don’t mean a look at the press conference and what Apple had to say about the Blackberry. No, let’s look at why they really are angry.

It all started back in 2007. Up ‘till early 2007, RIM had focused their efforts on business customers so heavily that until the iPhone introduced the concept of smartphones to the masses at large, many average consumers didn’t even know they existed. RIM was all too grateful when Apple introduced the iPhone in 2007, opening up RIM’s potential market to general consumers and not just business/power users. It worked, too, because RIM sold a hell of a lot more Blackberry devices shortly following the iPhone’s announcement than they did before that. People craved the power of mobile computing, Apple showed them it was possible, and even competing phones benefitted from that.

Fast-forward four years, it’s actually only the second time Jobs speaks ill of RIM’s products yet this time they’re furious. What has changed in those four years? Apple taking over, is what.

Sure enough, RIM still has a larger market share (at least) in the U.S., but mind– and media–share is now almost entirely reserved for Apple’s iPhone and Google’s Android platform, with the latter having far less mindshare outside of the U.S. than it enjoys inside it. RIM, for their part, have been relegated back to the place from whence they came: business customers. Except unlike pre-2007 days, there are now consumer phones heavily encroaching on this territory, threatening RIM’s core business.

How RIM reacted to Jobs’ accusations isn’t surprising: their attempts at breaking into the more consumer-friendly touchscreen market on their own have all largely been abysmal: their two touchscreen phones, the Storm and the Storm2, have failed to impress. No doubt this has frustrated them. The fact that Apple makes more money with iPhone than the entire rest of the smartphone industry combined makes with all their phones is just plain humiliating, and not just to RIM.

Nokia is similarly outplayed in the handset industry, and whilst they and RIM have decades more experience designing phones and antennas, they are failing to build products people want to buy nearly as much as they want an iPhone. Apple, to their credit, is innovating and taking some risks with it—like the external frame-based antenna on the iPhone 4. The risk seems to be a perfectly calculated risk about signal issues, taken in favor of all the many benefits this new hardware design offered. And I think it’s a risk that will pay off for Apple in the long run.

Imagine for a second that Apple figures out a way to resolve the signal attenuation problem for the next hardware release which, presumably, looks virtually or completely identical to the iPhone 4 of today. Imagine that they do this in the next year or less. Where will that leave RIM and Nokia and all the others? With already-inferior phones that people just aren’t quite excited by, with no innovation track record to show for past 2007, and their one remaining argument against the iPhone dissipated (with the AT&T-argument remaining for U.S. consumers).

Nokia and RIM can act high and mighty all they want about antenna design, but they’re sitting pretty still while Apple pushes mobile technology forward. What I wonder is, how long before their shareholders stop accepting that?

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