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Apple & Trust

Over the last several years, Apple has repeatedly made deposits in its trust bank with consumers, mostly by delivering interesting, well-designed products that people like to use. In the last day, they have made a huge withdrawal from that trust bank, and the impact on their brand will be interesting to watch. Saul Hansell has a good write up. In some ways what Apple is seeing in terms of backlash, and there is backlash -- people are pretty grumpy at what the rightly see as arrogance from Apple -- is the result of the company not fully absorbing they are no longer a niche player. If you are a niche player you can get away with playing crazy competitive games like Apple did with Real a while back, changing code to break Real's ability to work on the iPod. When you move to the mainstream and have people start depending on you (hello, big difference between suddenly having an iPod that can't play stuff from Real and having a PHONE that is now a brick), the rules change. Companies who don't really absorb this change in stature and continue to behave as insurgents as opposed to category leaders often make decisions that hurt their brand -- we are watching Apple do just this.

By the way, I think this is strike three for apple. Others would say strike two, but the first strike (having to send back the iPhone to get the battery replaced) has not yet fully  been driven home to people. Strike two was the iPhone price change, and the bricking of the phone is the final strike.

Published Friday, September 28, 2007 5:41 AM by FrankShaw

Comments

 

Nick said:

You are right; if Apple keeps this up they could be come nearly as despised by their own users as Microsoft.

With that said, everyone who did it knew the future risk of unlocking their iphone.  Apple gets a percentage of the monthly AT&T service contracts that come with every iphone; apple priced the phones based on this revenue sharing agreement.  The initial purchase price of the phone is like a down payment on a car, and the monthly car payments that follow are like your monthly phone bill from ATT/Apple.  Every iphone purchaser freely signed a contract to this effect—no illusions, no excuses.  Knowing this, unlocking an iphone is defiantly not something a “mainstream” user who needs to depend on their phone is going to do.

Unlocking your iphone and using it on a different carrier is stealing money from Apple shareholders.  Do most industry leading companies allow customers to steal from their shareholders?

Oh, and the same dedicated hackers who have written the code to unlock an iphone will have code that circumvents this software update out by next Tuesday, I'm sure.

September 28, 2007 11:56 AM

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