Felix Salmon

The value of a strong brand, Apple edition

By Felix Salmon
July 16, 2010

Steve Jobs did a great job at his press conference today, in classic Stevenote style. He showed that the “death grip” problem is endemic to the entire smartphone space, rather than being something unique to the iPhone 4. He talked a lot about how most of his customers love the phone, and how its return rates are a fraction of the equivalent number on the iPhone 3GS. He put up cool photos of Apple’s formerly-secret anechoic chambers. He announced that the iPhone will soon be available in white, and in 17 new countries, including Canada, Italy, and Spain. And he’s throwing in a free case for anybody who wants one, or a full refund. (Which existed all along, but it still sounds good.)

The only slightly dubious part of the presentation came when he said that the rate of increase in dropped calls, for the iPhone 4 over the iPhone 3GS, was less than 1 call per hundred. Without knowing what the rate is for the 3GS, or how the iPhone 4 rate compares to other phones, that number is meaningless.

What Jobs did well in this presser was to be both helpful and informative, rather than merely apologetic. That’s probably smart, because it’s really hard for anybody to apologize effectively, especially someone with an ego the size of Jobs’s.

Still, it’s going to be hard for this one event to counteract the narrative that has slowly built up over the past 22 days. Jobs is famous for pushing his design criteria beyond the bounds of common sense — most famously with the NeXTcube, but with the Apple Cube as well. (The cube on 5th Avenue is more successful.) So the story was easy to tell: Jobs loved the idea of a simple band around the edge of the phone which would act as the antenna. That kind of band doesn’t work well when touched. But Jobs overrode those objections because he loved the design so much.

In any case, the free-cases-for-everybody solution solves the problem, insofar as it is a problem. There are now two competing narratives when it comes to smartphone antennae and reception, the discussion is going to become very geeky very quickly, and most people will sensibly ignore it. Jobs also set up competing narratives when it comes to yesterday’s Bloomberg article alleging that he knew about antenna issues before the phone was released: by vehemently denying the allegations, Jobs again just creates a noisy debate which most people will pay no attention to. (Of course, the Bloomberg article also conflicts with the storyline that Jobs didn’t know about the problem because the real-world testing of the iPhone 4 took place in cases which disguised it.)

I also love the way that Jobs explicitly privileged customers over investors: he knows that investors ultimately care more about Apple’s happy customers than they do about the stock moving up or down $5 in a month.

Personally, I’m not a huge fan of the iPhone 4: while the screen is beautiful, I don’t like the hard edges, the extra weight, and the way that there’s no easy way of telling by touch which side is the front and which the back. But that’s just me. The US population as a whole seems to love the phone, and although there’s been a media firestorm over the antenna issues, Jobs has done such a good job of building up the Apple brand that the real-world effect of the story seems to have been minimal.

As Jobs says, Apple’s not perfect. But the real story here I think is one of brand value: if people love your products, they’ll trust you much more than if they don’t. The only downside is that the media will tend to glom on to any perceived problems. It’s a trade-off that all of Apple’s rivals would be very willing to accept.

8 comments so far | RSS Comments RSS

Thanks for a commentary that is intelligent and worth reading after so many have been so unhelpful to the public or the product. The innovation Apple has provided has made the electronic market what it is and that is something quite fantastic.

Posted by Reliability | Report as abusive

@ Reliability

Apple hasn’t been innovative since the ’80s.
Aesthetically pleasing? Yes.
Innovative? Absolutely not.

Posted by ElDuderino | Report as abusive

“There are now two competing narratives when it comes to smartphone antennae and reception, the discussion is going to become very geeky very quickly, and most people will sensibly ignore it.”

And I might add that there will also be numerous sheeple reporters that will report glib and tangential information that in no way get to the heart of the story. Instead they will make it clear that it is more important to follow blindly and not question the company and their feel good marketing department that brings their shallow, self devolved life a shadow of importance by not what they’ve accomplished as human beings, but rather what technology they can afford. And as damaged goods as that technology may be- it is more than you can ever imagine because those reporters and their followers have deemed it so! (place triumphant musical score here).

And you mere person shall never be allowed to carry such technology until you sing the unmitigated praise of the Gods of Apple!

Posted by mynamehear2 | Report as abusive

The major media outlets should have published:

“Jobs shows that the media narrative is worthless.”

Where is the proper investigative reporting? It applies to all stories, not just this Apple story of dropped calls. The real story here is not about Apple, their antenna, or Steve’s management. It’s about how narratives run wild while the media does nothing to validate or dispel. Poor Steve had to offer a slew of data and facts (and even the hand held tests on other phones that any high school journalist could have conducted). The media didn’t even understand that it was Steve’s way of snubbing them.

One last comment – I was impressed with Engadget, which did make some efforts. My hope is that he see blogs that are willing to do investigative journalism.

Posted by Brutus5000bc | Report as abusive

I can’t believe I’m about to post this, but… anyone who used a NeXT box would probaby debate your characterization of it as flawed by it’s industrial design. That thing rocked, aside from its lack of software. I know people who still use them.

Posted by RIckWebb | Report as abusive

Another thing about Next, Apple bought them to get Jobs back to run the company. And the Mac OS X was based on Next’s OS (which is based on Unix). If you think Next was just form over function, then you’re paying way too much attention to the bandwagoners that comprise most of the media, whether mainstream or internet.

I also think the idea of incorporating the antenna into the industrial design of the phone was a good idea, although all that might be becessary to eliminate the problem is apply a thin plastic coat that insulates the band from the skin of humans while letting radio signals pass through unattenuated.

This case should also be an example for other companies: keep your customers happy (like apple has), and you can ignore analysts’ and pundits’ suggestions. Which most companies should do anyway. Unless they suggest that companies keep their customer happy.

Posted by OnTheTimes | Report as abusive

Bottom-line I feel is this: great features, but the ‘phone’ feature is not up to snuff. My advice? Get a Blackberry (or Android) and iPad to get actual quality and functionality.

Posted by CDNrebel | Report as abusive

Apple’s more than a brand; it’s a lifestyle. Actually, it’s the idealization of an all-embracing lifestyle, which is branding process incarnate. If all you need in life is a phone that helps you get things done in an ideal world, you could make worse choices than Apple’s iPhone.

In the real world, unfortunately, you also need AT&T to make it work at all. And AT&T isn’t so much a brand or idealization of anything. AT&T is a death style, to which no soul is sacred.

Goethe wrote the book on this sort of epiphenomenon.

Posted by HBC | Report as abusive

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/