This is a business article. However, we must address
some of the clutter.
On CNBC Mr. Wozniak cited Constitutional Rights.
Here
is the IV Amendment.
The right of the people to be secure in their persons,
houses, papers, and effects, against unreasonable searches and seizures,
shall not be violated, and no warrants shall issue, but upon probable cause,
supported by oath or affirmation, and particularly describing the place to
be searched, and the persons or things to be seized.
Now, let's move on to the business issue. Because it is the
business issues that will make or break Apple's future in the medium and long
term.
When I wrote Apple Meets Hollywood, I was discussing
the corporate success parabola.
Two years ago I suggested that APPLE and Facebook buy AOL
Time Warner CNN. The reason? Content. $1.5 Billion Dollars + 1.5 Billion Users
= Profit$ It never happened. However, others have been buying up content. Now,
Apple is looking for content (original content) for their devices.
I also wrote
At the same time, another topic near and dear to my heart,
is the move to move “In sync” with Cisco. Why? To make Apple products more
useful to more people.
You all know the basic paradigm.
- An organization grows large.
- Economies to scale meet the law of diminishing returns.
- Focus on the quality of some products causes the
quality of others to suffer.
- There is contention among employees working on
different projects.
- Profits will attract competitors.
- A large number of competitors will nibble at profits.
- Unique features of competing products will create
pressure to improve your product.
- Pressure on employees (and on bosses) will effect
morale negatively.
- Some competitors will go out of business due to bad
products or management.
- Other competitors will blend together through M&A
creating larger competitors.
- Those competitors will benefit from economies to scale
as they grow.
- There will be market penetration. And innovation. And
competition.
- They will innovate and or cut prices causing you more
pressure.
- Big companies will begin to sell off bits of itself to:
- Better serve our valued and appreciated customers.
Now, APPLE is meeting with Cisco. Great Move.
The real issue with FBI v. AAPL does, ultimately come down
to a business issue. Tim Cook is running the risk of rebranding AAPL in
the worst way.
ANALOGY
During the Jimmy Carter gas crisis, Detroit (Synecdoche
for The US Auto Industry) refused to embrace the smaller, 4-cylinder
automobile.
This offered the Japanese Auto Industry to penetrate the
market.
Japanese cars were not only relabeled as the economical car, they
were soon relabeled as the ecological car.
The US auto industry lost market share.
Now look at the cell-phone.
Mr. Cook knows what he is saying, and knows what some
of his customers are hearing. But ignores what others are hearing.
As Yogi Berra said, "In theory, there is no difference
between theory and practice. In practice there is."
As Mr. Cook is pounding and propounding TRUST, he is
speaking only to those people he wants to speak to. However, others
listening. When he says, "Trust" others hear what he has to
say. By way of metaphor, right now, a terrorist is saying, "Let's
buy i-phones. We can trust Apple to protect our privacy." And
exaggeration? No.
And remember, we did capture Osama bin Laden, by
tracking him through cell phones.
And we need not discuss all phones or all technology. The
safe and face-saving course would be for Apple to hack into one phone, give the
information to the FBI, and have done with it.
Mr. Cook, however, is in a lose-lose situation.
1. His competitors can relabel i-phones as The Terrorist's
Phone.
2. He can lose the case in the courts and lose a lot more
than his is willing or can afford to lose.
All this, strictly, from a business viewpoint.
Competitors can use this as an opportunity to penetrate
Apple's market. A spirit of nationalism will move the market, the
consumer, away from Apple to their own countries phones.
In addition, it is possible someone else will hack the
iphone. The entire issue will become moot, and Tim Cook and Apple will suffer
loss of face. In Asian markets, this will become a death-knell to the
Apple brand.
The issue is not privacy, rights, or national
security. The entire issue involves how Tim Cook handles a threat to his
brand, his market share, and his bottom line.
Warmest regards,
Slim.
If anyone finds this to be helpful, please don't hesitate to
send me a really tricked out Mac Book or i-pad & to tuck a few dollars into the
envelope along with the thank you note.
Bob Asken
Box 33
Pen Argyl, PA 18072
Copyright (c) 2016 Bob Asken
All rights reserved.
