Biting Apple

BBC News headline, 28 September 2007

Interesting to see the BBC’s summary of the current iPhone update story: “Apple issues an update which damages iPhones that have been hacked by users”. I’m not sure that’s quite how Apple’s PR people would have put it, but it’s interesting to see that whoever writes those little summaries for the BBC website found it easiest to sum up the story in this way. This is being portrayed as Apple deliberately, strategically damaging the phones, rather than an update unintentionally causing problems with unlocked or modified phones.

Regardless of what the specific issue is here, and whether unmodified iPhones have also lost functionality because of some problem with the update, can’t we just strip out all this nonsense? How many people who wanted an iPhone also wanted to be locked in to AT&T or whatever the local carrier will be in each market? Anyone? Who wants to be locked in to anything? What a waste of technical effort, sweat and customer goodwill: it’s utterly pathetic.

This is exactly what Fred Reichheld‘s ‘Bad profits’ idea calls out so neatly:

Whenever a customer feels misled, mistreated, ignored, or coerced, then profits from that customer are bad. Bad profits come from unfair or misleading pricing. Bad profits arise when companies save money by delivering a lousy customer experience. Bad profits are about extracting value from customers, not creating value.

If bad profits are earned at the expense of customers, good profits are earned with customers’ enthusiastic cooperation. A company earns good profits when it so delights its customers that they willingly come back for more—and not only that, they tell their friends and colleagues to do business with the company.

What is the question that can tell good profits from bad? Simplicity itself: How likely is it that you would recommend this company to a friend or colleague?

If your iPhone’s just turned into the most stylish paperweight in the office, are you likely to recommend it to a colleague?

More to the point, if Apple had moved – in the first place – into offering telecom services to go with the hardware, with high levels of user experience and a transparent pricing system, how many iPhone users and Mac evangelists wouldn’t have at least considered changing?

8 thoughts on “Biting Apple”

  1. Just dont get it myself, As someone who has – HACKED – devices for 25 plus years, i have never said as i was breaking the warranty seal or hard coding system commands….

    OH Darn you so and so company, if this breaks its your fault , better pay up.

    There is a reason its called hacking and not cosmetic digital design, the results are not always pretty.

    To blame apple for using industry tactics to keep there regular customers devices updated is foolish.

    Hack and your device may hack back. to bad so sad!! :(

  2. Don’t forget that Auntie Beeb’s headline writers also described the Dawn probe as “Heading for the edge of the universe” :)

    As for Apple, they’ve been acting as if they were doing their customers a favour just by allowing them to buy the stuff for as long as they’ve been in business. That’s why there are so many jokes at the expense of Mac propellerheads. The difference now is that SJ is playing to a much larger audience. His calculation, presumably, is that the levels of customer satisfaction with mobile phone networks that get reported by the likes of uSwitch are so low to begin with, that he stands a chance.

  3. There will always be someone out there like Joe Dauz who would want to hack Apple devices. If Apple could think outside the box (so to speak), I’m pretty sure they are smart enough to find a solution that would benefit everyone. Issuing an update which damages iPhones that have been hacked by users is simply in a word: mean. Owners of second-hand iPhones that have been hacked without their knowledge would be the ones worst hit. This arrogant move may rot the image of Apple.

  4. Well, I agree it was kind of mean of Apple to release this update. But I agree with the author it is well possible Apple would have sold more iphones if you as a consumer are not forced to buy a phone with an subscription to AT&T. It would have been much more transparent for us, the costumers, if we could see how everything was priced.

  5. I believe that the reduced point of entry for the iPhone (now $99) was the most significant point in the recent announcemnet and demonstrates Apples move from boutique brand to mass market.

    The limiting factor long term is Apples operator exclusivity arrangmenets. People will increasingly become resentful of the lack of choice unless this is addressed. I suspect the standard phone will eventually be available on all networks, with the advanced models exclusive to the incumbant operators.

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