Apple at a China Crossroad

No, we're not stirring the pot again on our proposed Jobs' trip to China. We're referring to the impending collision between business decisions and political appeasements. Apple will have some serious decisions to make over the next few months regarding this lucrative market. Just this week reports surfaced that iTunes in China has been blocked due to Pro-Tibetan content, specifically, the "Songs for Tibet" album, added this week.

Apple, like many global companies faces serious questions in China. How should this situation be resolved? Give in to pressure from China and remove the album, at the risk of a backlash from around the world, or stand firm and risk losing what could easily be one of their most lucrative iPhone markets? And yes, there is the tiny detail that many Apple products are manufactured in China, as well.

What will Apple do? Well, there is one small incident that might give us a hint. Last year, Venezuelan president Hugo Chavez decided to unilaterally change the time zone of Venezuela by half an hour. As you probably have noticed, most time zones are segmented by hours. The move placed Venezuela in its own time zone. As of July, Apple hadn't added the half hour offset for Venezuela in its time settings, causing problems like these. Microsoft on the other hand, had an update out within a few weeks acknowledging the time zone change. Was this lack of change an intentional political statement on Apple's part? If so, would they be as willing to take that sort of stand with China?

Dealing with China will be a far more high-profile, and high stakes process. Apple was wise to bring Andrea Jung from Avon onto the board early this year. At the time, the move was seen as a smart way to learn to market more effectively to women in China. In reality though, Jung could prove even more important as Apple navigates the Chinese political landscape.

While Apple has been a global brand for decades, China may be the first significant time in which a decision they make - to pull the Pro-Tibet album or not - will displease at least one major group of potential customers. Our bet: the album will disappear from the Chinese iTunes store, iTunes access in China will be restored, and except for a few protests (perhaps a letter from Richard Gere?) we'll all forget this happened. On the other hand, if it's a slow news cycle, or the issue is painted against the bigger backdrop of doing business with China, then this might not go away as quickly as Apple would like.

So put on your CEO hat. What would you do if you ran Apple?

Apple shareholders deserve succession plan

An article in today's New York Post again calls into question the status of Steve Jobs' health. The real question though isn't whether Apple's leader is sick, but rather why won't Apple publicly announce a succession plan?

Even if there was no reason to be concerned, and there certainly is given Jobs' previous bout with pancreatic cancer, it's only fair to shareholders to know what Apple's contingency plan may be. The company rides high on its connection to its leader. Buf if Jobs were unable to lead Apple, just think of what would happen to the current stock value.

Jobs eventual departure via retirement or other means, doesn't have to be a sinking of the company though. Apple could start minimizing the risk now by succinctly explaining the succession plan. And if that's too much to ask, let's at least start to hear more about the people behind these great products. Many, many moons ago, some of the first Apple products shipped with the autographs of the developers inside. That tradition has long since passed, and in its place, thousands of Apple engineers toil in anonymity.

Yes, there are strategic reasons for this. Other companies would jump at the chance to steal away Apple engineers. How much would Nokia pay to pick up a few members of the iPhone team? However, the payback to shareholders - knowing that the success of Apple's products is the result of the input of many creative people, would go a long way toward calming investor fears.
It's been a great strategy by Apple to keep product details in the dark as long as possible. People however, are not products. Shareholders deserve to know that their investment in the company is more valuable than the participation of one person in the company

Farewell, Bill

Today marks the end of Bill Gates' day to day involvement in Microsoft. You know, you really can't talk about the history of Apple, without talking about Bill Gates. I think it's fair to say, at least from all the clips we've ever seen, Gates is not "evil." Yes, there were policies and conduct by Microsoft through the years that many of us in the Apple world might consider evil, or even illegal. But at the end of the Gates has always seemed rational, and visionary in his own way.

Plus, there's something to be said for a CEO who amasses a large fortune, then uses it to do good. Let's be honest, the jury is still out on whether Steve Jobs will ever make a similar gesture. And just in case you think Gates' decision to use his money for good is a recent development, we offer the NBC clip below from 1992. It's an interesting time capsule, anyway you look at it. Gates talks about some new fangled thing called electronic mail, and how it could become the future, if only there would be enough desktop computers. If only, indeed.

So here's a hardy pat on the back to the man who piloted the most influential technology company of the last 20 years. And also a heartfelt thank you for allowing Steve Ballmer to take over at Microsoft. Nothing ensures our continued amusement, and Apple's continued success as having him at the helm.

Jobs in the clear? SEC most likely not to file suit against Steve Jobs

As an update to the SEC’s investigation of Apple and Steve Jobs regarding stock options backdating, it appears, Steve may be in the clear. Not only did the internal audits conducted by the SEC prove to be ok, Steve has made a clear case that as CEO he may not have known about the legal subtext of backdating that may have been carried out by his second-in-command employees. The SEC sued both Apple’s Chief Financial Officer Fred Thompson and ex-General Counsel Nancy Heinen last year for apparent backdating-related fraud, leaving Jobs, at this point, out of focus.

While Steve may be in the clear with the internal audits conducted, that does not necessarily mean that the SEC does not have a case. The SEC only has to prove that the executive, in this case Steve Jobs, knew the alleged backdating was occurring and therefore disregarding the accounting rules put in place by the SEC to regulate such behavior. If the SEC feels they would have evidentiary support to make this case, they can proceed with action.

The interesting part is that the government may in fact do nothing even if some evidence is found. A few high profile attorneys commented on the case, including Anthony Sabino, who is a white collar defender and professor at St. John’s University in New York, stating that because of Steve Jobs “immensely well-known and well-respected” status in the business world, the government may not want to press the matter any further.

While it is still pending whether action will be taken against Steve or not, I’d have to agree with Mr. Sabino’s sentiments on the matter that could be facing the bar. Especially in a high profile case, where a jury will serve, the jury represents the American public’s opinion and that may leave for a very one-sided jury, no matter what the selection process.

This blog is based an article found at reuters.com regarding the SEC options suit

http://www.reuters.com/article/PBLSHG/idUSN0736611420080530?pageNumber=4&virtualBrandChannel=10112

Root Access: How does Apple handle damage repairs?

There was a recent hubbub about an email sent to Steve Jobs regarding a $300 price quote from Apple to look at his computer's water damage. Something sounded a little fishy, so it was time to ask our resident genius whether this was all just a tad bit suspicious: