Defensive Strategy

Something Different from Apple

20 Jul 2010  

The press conference on Friday was an all too familiar scene: a somewhat grumpy CEO making a reluctant apology, noting that the press has blown things way out of proportion and complaining that the company isn’t being treated fairly, since everyone in the industry has similar problems.

The company was:  BP?  Goldman Sachs?  Toyota?  Nope.

As anyone following the news knows, it was Apple.

Now this is something different.  For the first time in a long time, Apple and Steve Jobs are on the defensive, forced to address some very real quality problems.

It is a dramatic shift.  Apple has been on an incredible roll the past several years.  Apple is the company that can do no wrong, the company that everyone admires.  Now, however, Apple has an issue.

It is clear that this is an unfamiliar and unpleasant spot for Apple and Steve.  In his news conference on Friday, Jobs seemed bothered and somewhat angry.  I thought his attitude was a bit: “I’m Steve Jobs.  I’m CEO of Apple.  You are not.  So what makes you think you can point out a problem in my product?”

In truth, this doesn’t seem like a huge issue.  It isn’t a major product flaw and Apple has apparently provided a reasonable solution.

Still, it is clear that Apple is now being held to a very high standard and rightly so.  When people believe you are the finest technology company in the world, the pressure is on.  Small quality concerns quickly become big issues.

I suspect Apple will have a tough time living up to its reputation in the years ahead; this might be just the first of many disappointments to come.

7 Responses

  1. craig kensek says:

    Agreed! I’ve got no qualms about getting my second comment removed by the author of the website. Too much caffeine.


  2. Craig –

    Probably not worth getting into a debate over our definitions of defensive.

    In order to discuss the performance of various antennas in smartphones, it is by definition necessary to talk about other phones that the one at issue. You’ll notice Apple included its own iPhone 3GS in these factual representations of attenuation.

    As to Consumer Reports, my instinct is that they piggybacked on this iPhone 4 issue to get themselves some free publicity. Apple’s brand will get more hits on a website than CRs… 😉



  3. craig kensek says:


    I think when a company starts looking at competing products, and putting shots of them on their web site, that that may qualify as being defensive. I still believe that the “don’t hold it like that” struck a cord with public and the comment rates up there (higher) than BP’s comment about “the little people”.

    BTW – I’ve had issues with how Consumer Reports has products of companies I’ve been with. Their lab isn’t a $100 million operation. They do buy the products they test, and for better or for worse, the marketplace likes their methodologies.

  4. Tim –

    As a Kellogg graudate from 1992 and a veteran of Apple from 1987-97 and 04-06, your blog post highlighted in Kellogg Insight caught by eye. Actually, I was working at Apple, while I pursed my MBA at Kellogg during the evenings from 1989-1992.

    I think the interesting story from this whole iPhone 4 affair is how careful a great brand (with great products in Apple’s case) has to be when its competitors and a non-discerning media stoke the fires of a non-story.

    If you go back and watch the press conference itself (being a law graduate, too, I’m big on actual source materials), it was a masterful elucidation of facts. The fact that this story has completely disappeared is due to the fact that when Steve and Apple put videos of all the major smartphones on their web site, it became abundantly clear this is a common antenna issue, not a unique Apple problem. (That said, the software fix for the bars should have been part of the release to avoid this altogether.)

    I think the brand to worry about is Consumer Reports. Think about it. If this was such a big problem and if Consumer Reports testing is so good, then why did this miss it the first time around? For 3 weeks, iPhone sat atop their recommended list of smartphones. I’m curious if they circled back as the blogosphere erupted because they realized their credibility was at stake for missing this in their “labs” or perhaps other manufacturers reached out to them? Speculation, of course.

    You’ll notice the Apple Antenna Design and Test Labs are still up. I suspect we won’t see a similar set of photos from Consumer Reports. I suspect they haven’t invested close to $100M in theirs.

    So, Apple wasn’t on the defensive. They just took the time to thoroughly research the facts. Hopefully, we’ll do the same thing with the oil spill in the Gulf.

  5. craig kensek says:

    Jobs comment, “Don’t hold it like that” will make it into any books or articles written about Steven Jobs in the future. Apple/Jobs blinked, when they agreed to send out cases to all of the purchasers of Iphones.

    This may be an urban legend, but supposedly the person who left a prototype Iphone at the bar is left handed, meaning he may have caught the glitch prior to introduction. However, this was late in the design phase.

  6. […] This post was mentioned on Twitter by Kellogg School, Naren Patil. Naren Patil said: RT @KelloggSchool: Something different from Apple and Steve Jobs #Kellogg Prof Tim Calkins on Friday's press conferen … […]

  7. Thanks for the great blog. Completely agree that Apple has raised the bar for itself by creating great user friendly products that have functioned flawlessly till date. It has benefited immensely from the social media world which has also helped it build a strong brand. But social media is a double edged sword and unless this is a one off incident, it could potentially damage the brand.

Join the conversation