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Apple and the High Road

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Shhh! Listen. Hear anything?

Nope, not a thing. And that’s exactly the way Steve Jobs wants it. Not a lot of people are talking about the the iPhone 4 antenna problem these days. You can chalk that up either to the fickle 24-hour news cycle or to some effective PR. I’m inclined to credit the latter, though Apple’s crisis strategy wasn’t what I’d either hoped or expected. But then I guess they “think different”, as their ads once said.

By now everyone knows the story. The iPhone 4 was launched in June, and within a week YouTube videos were popping up, demonstrating the phone antenna’s tendency to drop signal when held at a specific angle. The company’s response was twofold. First, it convened a press conference with Steve Jobs himself, a move that showed the world that Apple took the problem seriously.

But that wasn’t the unexpected part. That came when Jobs took the podium and offered his defense. It was, in a nutshell: everybody does it. He then demonstrated how comparable phones from other tech firms also drop signal when held at the same angle. The industry howled in outrage, then issued a series of non-denial denials which indicated that Jobs was exactly right.

Yet here’s the problem with the everybody-does-it line of defense: it isn’t the stand-up guy thing to do. Had Jobs been operating under more thoughtful crisis strategy, he would have taken the podium, issued an apology, then told the world the issue would be resolved immediately at no cost to Apple’s customers. I have no doubt that smirking Nokia executives expected that very thing when they tuned in to watch (hence the howling).

All of which begs the question, at least for those of us who consider themselves members of the ‘high road’ school of media strategy, as to whether the high road is always the right road. I believe it is, and that when it comes to managing a brand, honesty and honor always serve a brand better than dishonesty and/or dishonor.

Jobs told the truth, more than that a global truth about the industry, so he’s not guilty of dishonesty. However he is guilty of acting dishonorably. Quaint as those words may sound these days, the truth is that while honor may be out of vogue on a cultural level, consumers nevertheless expect their favorite brands not only to provide top-quality products, but to conduct themselves in a way that is honorable. Apple consumers expect, in a word, more.

The result is that while Apple is taking its iPhone 4 profits to the bank, it is also making a substantial withdrawal from its brand equity account, a reserve that in the long run will prove a whole lot harder to re-fill, now that Jobs has demoted Apple to the level of everybody other competitor in the category.

This particular controversy is now over. But there will always be others.  And the sharks are even now circling.

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