Apple Outsider

Industry News, Exploits and Hacks from a former Apple Insider

Mark

GM Gets Creative

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Earlier this month, Chevrolet announced a $5800 option for Corvette Z06 and ZR1 buyers to build their own engine right inside the Performance Build Center in Wixom, Michigan. They’ve posted a great HD video on YouTube illustrating the build process. It’s a wonderfully creative move that shows someone at GM is thinking about a company’s relationship with its customers.

Casual car owners may be wondering why one would pay extra money to do the manufacturer’s work. The type of customer who would buy these cars is not confused at all: for a true sports car enthusiast, there may be nothing more intimate than building an engine.

Most high-end sports car makers offer meaningless options and “experiences” designed only to extract more money from the target demographic: $1500 leather; $2000 paint jobs; $5000 “driving schools” with less than an hour behind the wheel. Yet here is GM, a company written off for dead by many observers, with perhaps the most memorable experience possible. What’s cooler than owning a 500-plus horsepower supercar? Building one with your own hands.

Between the employee time investment and the low volume of Z06 and ZR1 sales, this program will not be a moneymaker for GM. That’s not the point. This is a bold and brilliant move to establish a rapport with core customers, and to get the attention of enthusiasts and industry observers. It’s reminiscent of what Apple stayed true to while staging the biggest comeback in the history of business.

It’s very encouraging to see this kind of thinking still alive in Detroit. Companies in every industry should do more of it.

(Aside: Note “Corvette” is the stated brand in the video—GM wisely continues to distance its own tainted image. Don’t be surprised if Corvette becomes its own company in the next few years.)

Thoughts on the iPhone 4 Press Conference

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Friday’s press conference on the Apple campus in Cupertino was unprecedented in a number of ways. Apple is used to calling the shots, and talking on its own terms and timing. The iPhone 4 antenna situation has been a complete reversal: external pressure has forced Apple to talk sooner, in more detail, and on more occasions than it had probably ever expected or wished to.

For at least a week, “Antennagate” has transcended the existence or prevalence of an actual technical defect. When my father calls me asking what’s wrong with the new iPhone, or Consumer Reports refuses to recommend an otherwise excellent product, or an incumbent up for reelection piles on, Apple has a serious problem. Right or wrong, public perception of this new flagship product has been damaged. It no longer matters if the defects are real.

Enter the press conference, intending to meet all the chatter head on. Did the information Apple provided convince observers that there’s nothing wrong with iPhone 4? Only sales figures will tell. We will of course never know what sales would have been without this conference.

Leading up to the event, most of the media concluded that cases or bumpers would resolve the “death grip” issue and that Apple should give them away for free. Apple did that, additionally offering refunds to those who have already bought Bumpers (regardless of why they bought one), and even third party cases to account for Bumper shortages. Everyone’s eggs were in this basket, so if this does not materially settle the issue, I’m not sure what will.

That said, I found that the presentation’s tone overshadowed its content. The event opened awkwardly with the iPhone Antenna Song, which includes lyrics like “the media loves a failure,” “the facts won’t ever matter,” and “this whole damn thing is stupid.” Members of “the media” who flew across the country on barely any notice to sit in that room and hear Apple out; who were about to be trusted with relaying a message critical to Apple’s reputation; were greeted with sarcastic hostility. Customers who have seen their dropped calls double and triple—statistical minority or not, they exist—were mocked. This is not how you begin a reconciliatory conversation. Perhaps Apple thought the song was a lighthearted way to clear the air before getting on with it. I think they’d have done better by just getting on with it.

It’s also worth noting that, as far as I can tell, this is the first time Gizmodo’s name has been uttered in an Apple presentation or statement since April’s prototype leak. To do so now, and single them out when plenty of other outlets have been piling on, was bizarre to me.

It didn’t stop there. The free Bumper concession was delivered with what I can only describe as contempt. Farhad Manjoo’s headline at Slate embodies the moment perfectly, but you really have to just watch the video.

“A lot of people have told us, ‘The bumper solves the signal-strength problem… Why don’t you just give everybody a case?’ Okay. Great. Let’s give everybody a case.”

The Q&A offered additional insight. This comment from Steve Jobs, reiterated by John Siracusa at Ars Technica after appearing in most of the liveblogs, was eye-opening:

Apple’s been around for 34 years. Haven’t we earned the credibility and trust from some of the press to give us a little bit of the benefit of the doubt, of our motivations, the fact that we’re confident and will solve these problems?

This is a remarkable depiction of Apple’s strained relationship with the press. From start to finish, Friday’s PR offensive assumed that the answer to this question is “yes.” It is, of course, “no.” Whether you are the CEO of the second largest corporation in the U.S. or a general in the U.S. military, it should be no surprise when the press reports what it sees and hears. If a media outlet reports garbage, then all things being equal, its reputation should pay a price. If it has information that it believes to be both material and credible to a relevant topic, it is not obligated to sugarcoat that information, but to report it.

Antennagate is news exactly because Apple has hit so many home runs—and, by the way, received countless glowing headlines to match. Apple should be nervous when this sort of thing isn’t news: it would mean nobody cares anymore.

John Martellaro at The Mac Observer concludes:

The net result of this is that Apple has learned a lot about being a consumer electronics giant. Their public relations people can’t stonewall. The company can’t both claim that their product is superior to all others, a perfect object that’s droolworthy, and then later admit that it has the same reception problems as all other smartphones.

It’s lonely at the top. Perhaps Apple is taking it on the chin more than usual. Such is the price of success.

I remain very happy with my iPhone 4. I still believe it’s the best iPhone ever, by far. I believe the Bumper offering is an appropriate gesture, and I believe Apple will still sell a ton of phones.

I also believe humility is an essential part of customer service. If Friday’s message was for consumers, a concise open letter like the ones we’ve seen on Flash, DRM, the iPhone price drop (speaking of overblown), and the MobileMe rollout, with links to the new antenna and testing sites, would have been just fine. Instead, it was a drawn out, mixed bag that pointed fingers while neither accepting nor denying fault. It was uncharacteristic of a company that communicates as well as Apple.

Nokia Goes After the Death Grip

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Nokia took a witty jab at the iPhone 4 “Death Grip” issue this morning with a post asking “How do you hold your Nokia?” (Witty answer: “Not at all.”)

Speculation remains high on whether the issue is due to a software bug or a hardware design flaw. If it’s software, it should be fixable. If it’s an inherent problem with the phone itself, and the complaints increase, expect more competitors to joke around.

My personal experience with the issue has been unremarkable: I’ve seen the bars go down when held a certain way, but no real degradation in voice or data service. Connectivity, which has always been a bit spotty where I live, seems no different from my 3GS. If I hadn’t seen the headlines, I probably would not have noticed anything unusual. It’ll be at least a week of use before I can really tell.

Great Moments in Marketing, Vol. 1: Nokia X5

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If you were wondering why Nokia was missing from the Wild West list, wonder no more. By now everyone has seen the X5, announced this week at Nokia Connection 2010. It appears to not be a joke. Daring Fireball, Boing Boing, even the WSJ have already weighed in.

The problem here goes beyond the product itself. The X5 is clearly a low-to-midrange model that complements the much more interesting N8, and Nokia has always been a volume player. What’s truly remarkable is the communication: why make such a confused, tainted announcement at your own event? Here are a few things everybody should be talking about in the wake of Connection 2010, taken from Nokia’s own N8 site:

  • HD video recording
  • Symbian^3
  • Facebook integration
  • Live, customizable home screen features
  • HDMI output

Instead, we’re talking about a pink parts bin offering. Keep in mind the N8 is still not in the hands of consumers. It has enjoyed zero real hours of flagship status, and is already losing airtime to a lesser product.

Given the competition of late, it’s hard to believe the X5 is receiving any kind of spotlight. Nokia should be pushing the N8 nonstop — until it ships, and for at least a few months beyond that. Go ahead and release the X5 quietly at any point afterwards. Nokia needs to highlight compelling products, not cheap ones. They’re already on the ropes in terms of mindshare; market share and revenue may not be far behind.

Related: The Ovi Maps service is billed as “For free. Forever,” where “forever” actually means “as long as Ovi and/or Nokia survive.”

WWDC10

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WWDC has always been unique for having dual identities: developer conference and consumer event. Attendees seek technical knowledge that’s not applicable to most people, while the keynote announcements draw interest from millions around the world. Other developer events such as GDC do have consumer impact, but don’t enjoy nearly as much coverage in the mainstream media.

This year, however, Google I/O rose to that level, with announcements of both new and upgraded consumer products drawing strong publicity. Its keynote rhetoric also highlighted the intensity of the now full-blown rivalry between Apple and Google. As expected, Apple fired back in the WWDC keynote last Monday, with varying degrees of subtlety.

It’s important to note that Apple does not frequently acknowledge competing products when discussing its own; the keynotes and special events typically promote the strengths of the product alone. A significant amount of last Monday’s keynote content was, by contrast, clearly influenced by competitive pressure.

The breakdown of mobile market share was predictable and direct. The financials were there, as always, to show developers that iPhone is a platform worth investing in. But the third party demos were telling. Apple often chooses these demos carefully to showcase specific new Apple hardware or software features. Not so this year: the chosen demos did nothing new and were not using iPhone 4 or iOS 4. They were simply leading brands, all in the entertainment space, that consumers recognize and respond to. (Yes, including Farmville.) Rather than “look what iPhone can do,” these demos said “look what iPhone’s got.” It’s a notable difference in message, presumably driven at least in part by the new competitive landscape.

Steve Jobs also spent a lot of time Monday deflecting heavy criticism of Apple for not being “open” enough. The first point made to this end was a clear differentiation between the open web — which Apple not only supports but continues to drive — and the “curated” native App Store. The use of “curated” was very deliberate, and a direct response to the much more negative “closed” thrown around lately. Look for it in future statements and interviews until criticism subsides. Meanwhile, developments in Safari and WebKit continue to raise the bar for standards-based web apps.

The introduction of Bing as a search provider for Safari on iPhone had been rumored for some time. Naturally, everyone saw this development as an attack on Google. But the presentation itself sent just as much of a message. Jobs used the word “choice” six times in less than twenty seconds during the Bing announcement. While Apple’s addition of Bing was a shot at Google’s core business, the announcement was a shot at its melodramatic PR.

One can’t help but appreciate the irony here. The initial friendship between Apple and Google was surely inspired in part by a common rival in Microsoft. Now the tables have turned, with Apple and Microsoft sharing the stage against Google. The reversal is so severe that a busted Bing demo in a later session drew heavy applause upon finally working. A WWDC audience would not have been so kind to Microsoft in earlier years.

The announcement that FaceTime would be an open standard was another surprise. Would Apple have done this without the pressure Google and Adobe have been applying? Maybe. But we certainly wouldn’t have seen a slide with a giant “OPEN” on it.

Finally, the free iOS 4 upgrade should give Apple some high ground on Android among developers. This is the first time iPod touch users have not had to pay for a major OS upgrade, thanks in part to looser accounting rules. But too much is at stake, and Android’s fragmented installed base will become a louder talking point. Apple wants every customer on 4.0 as soon as possible, and wants every developer to know that it’s safe to move forward without looking back. Don’t be surprised if Apple becomes unusually vocal about the number of users running 4.0.

Probably the biggest takeaway from the keynote, though, was the lack of a supporting cast for the first time in many years. No Phil. No Scott. No Bertrand. Steve Jobs is back, and back in charge, and nobody else was going to deliver the news or the message under this kind of pressure.

The battle continues to heat up. With both words and actions, Apple is taking the competition very seriously.