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Will Apple learn their lesson from the iPhone 4 drama?



From the prototype “found” in a bar to the “Antennagate” scandal, the iPhone 4 has been a real source of drama for Apple. They’ve handled the situations adequately enough, but what can they learn from all of this?

Short answer: nothing. Let’s face it, not only are they handling things better than anyone else would, but after their recent earnings report, Apple is clearly writing the rulebook on how to do business, not reading from it. That said, these situations are a tarnish on their shine, nor did they spring from a vacuum. Apple may be a money-making machine, but they can still stand to improve and fix the flaws in their leviathan.

1. Not everything needs to be secret. I appreciate that every company, especially those that deal with intellectual property, have to maintain a certain level of secrecy. As a brand new product, the iPad, for example, certainly had to be kept under wraps until its unveiling. But the iPhone is now on its fourth version. Its basic functionality is established, and its upgrade path is fairly predictable. We already expected a front camera and LED flash. Apple could have let their accessory partners in on the exterior specs without spoiling any surprises. That would have ensured they’d have cases at launch, the lack of which Steve Jobs cited as a problem at the press conference. It would also have relieved some of the insane demand for any info about the iPhone 4 prior to its release, which contributed to the “found” prototype craziness.

2. Embrace the extended iPhone ecosystem. Related to their obsession with secrecy, Apple remains a bit standoff-ish with their accessory partners. Going back to the case example, it’s great that Apple designed their own case to address what they must have recognized as the shortcomings of the iPhone 4, but did they really have to make it themselves? Couldn’t they have released the Bumper as a reference design and let third-parties run with it? That could have fixed the case shortage problem from the get-go, and more likely than not, we’d have them in every color of the rainbow, plus fun patterns. Apple should, of course, continue to produce the critical accessories for the iPhone, such as the power adapter and dock cable. But judging from the sales report, it wouldn’t noticeably affect their bottom line to let third-parties manufacture everything else (which Apple would still sell for a profit through their stores).

That ecosystem isn’t limited to physical attachments. Developers stick with the iPhone because it’s holding the biggest pot of money, but the lack of transparency in the app approval process and developer agreements is still a weak spot. I’m not suggesting they open it up entirely and rely on remote kill to deal with problems after the fact, but it’s time to treat that massive developer community like a community. The wall of secrecy was fine at the beginning, but now with iOS on its fourth version, it’s just an obstacle.

3. The iPhone is too big for one launch day. Apple COO Tim Cook stated they can’t make enough iPhone 4s to keep up with current demand. That’s because their one new model per year policy creates a short-term boom of massive sales that they is beyond their ability to meet with supply. Simply contracting additional factories isn’t enough of a countermeasure since there are only so many components to go around. This problem must be addressed with a long-term solution, such as adding a second release date.

A second release date has been floated as part of the Verizon iPhone rumor, specifically that it will be coming in January. I don’t know if that will happen this coming January, but I do know that when Apple does launch with a second carrier in the States, it can’t stick with a single release date. They can’t even keep up with launch demand with an AT&T-only iPhone. Adding another carrier with the same release date would only compound the problem. With or without a second carrier, Apple should consider distributing demand by stepping up the iPhone update cycle. Once a year is fine for computers, but the smartphone evolution rate is blindingly fast. Android phones update so rapidly, there’s almost no point in restocking sold-out models. Just wait a month and get the even newer model. Twice a year won’t match that rate, but it’s twice as fast as once a year.

In addition to splitting demand for the device itself, this could also split demand for knowledge about the device. That long wait between new iPhones helps drive that insane hunger to know what’s coming next and pry for secrets. I think they can afford to divvy that up between two days. Yes, they’ll probably have to split major updates between the two iPhone releases, but at least design mistakes won’t have to haunt them all year.

I’m under no illusions that Apple will implement any of these changes or even learn any lessons from all that’s happened. In business, the bottom line is all that matters, and Apple has no trouble there. However, for a company of engineers, as Jobs claims it to be, these weak points in their structure cry out for attention. Apple is far larger now than when Jobs returned to the helm. Don’t assume the structure isn’t straining under all that extra weight.



  1. shauns

    07/21/2010 at 1:33 pm

    AT&T released their call drop statistics – the iPhone 4 might drop up to 70% more calls than other AT&T phones!

    AT&T claims their call drop rate is as low as 1.44%, while another survey says it’s 4.5%

    What’s most interesting about this: If the iPhone 4 drops one more call per 100, like Steve Jobs said at the press conference, that could mean it drops 2.44% or up to 70% more calls than other AT&T phones.

    And even if the iPhone 3GS drops 4.5%, that’s still an increase of 22% (to 5.5%) for the iPhone 4 and its antenna design flaw.

    Definitely worth a story IMO, despite the ‘let’s move on’, because those numbers are crazy.

    • Sumocat

      07/21/2010 at 1:43 pm

      The fact that the iPhone 4 drops more calls than the 3GS, even if it’s only one more per hundred, is a severe embarrassment for Apple since their antenna is supposedly better (not counting the death spot). However, you’re mixing AT&T overall numbers with iPhone-specific numbers. The 3GS rate could be .5% or 5%. We really can’t distill that out from any of the total AT&T figures.

    • Roger

      07/22/2010 at 10:01 pm

      Hilarious Steve Jobs parody of the Press Conference


  2. Fleon

    07/21/2010 at 3:26 pm

    Yep, that did it.
    This level of crap and illogical babble has just dropped GBM from my RSS feeds. After 3 years, it’s just gotten to be a blog for whoever is posting their personal feelings. No reporting, no news, no unique tablet content. Now you just talk about the iPad and statements like “not only are they handling things better than anyone else would” after the Chen incident, Jobs’ arrogant email responses, and the fact they knew about this design flaw for months prior to launch is rampant and foolish fanboism.

    • Sumocat

      07/21/2010 at 4:10 pm

      Sorry to hear that Fleon, but if you think pointing out flaws in the company makes me a fanboy, then I can’t do anything for you. I would point out I asked the same question of Microsoft and Kin (which led me to ask it again) and, unlike many others, I did not ridicule them for that failure. Interpret that as you will.

  3. ActiveInvestor

    07/21/2010 at 3:30 pm

    I don’t want Apple to lose $175 million dollars for nothing! Why does Steve Jobs have to give out free bumper cases out in the first place? If I recall correctly, Apple and Steve insisted that this was a non-issue only affecting a tiny percent of customers.

    Does Apple really plan to give out free bumper cases to the majority of iPhone 4 users who don’t need it? Complete nonsense! What a waste!..I may have to decide to sell my shares if Steve doesn’t think this through carefully.

    No issues means no free bumper covers…simple as that.

    • Nick

      07/21/2010 at 6:42 pm

      The legal department has a term for that: CYA

      • Nick

        07/21/2010 at 6:44 pm

        Sorry, the above statement was meant to be a reply for ActiveInvestor. Mea Culpa

  4. Perry

    07/23/2010 at 11:36 am

    “Let’s face it, not only are they handling things better than anyone else would”

    I’m sorry, but this is just silly.

    Now if we reworded that to say they’re handling things more arrogantly than almost anyone else, I’d have to agree. I think we can safely sum up their response as:

    “There is no problem. And here is a free workaround for the problem… that isn’t.”

    You do touch a bit on the real problem, and that is Apple’s sacrifice of quality in order to feed Steve Jobs’ ego. He loves surprising audiences once or twice a year with his new products when it would obviously be much better from a quality standpoint to release them ahead of time to accessory vendors, developers, members of the media, etc. for review and testing. I think he would find that he could still build as much interest in the new products as they near release as he does now by springing them on the Apple faithful.

    The difference would be, you wouldn’t have antenna or screen problems like the iPhone 4 does; that sort of thing would have been resolved well before the launch. And THAT would be a FAR better way of handling things than what Apple does.

    • Sumocat

      07/23/2010 at 12:51 pm

      I feel that people aren’t getting that this is a comparative phrase, which doesn’t actually mean they did a great job. Smaller companies simply couldn’t deal with a PR problem this big. Comparably sized companies are notoriously bad at dealing with any PR problem, big or small. When it comes to PR, they’re the brightest kid on the short bus.

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