Earlier today Apple held their iPhone 4 press conference to address the issue of iPhone 4's supposed reception problems. You can watch the full video, but it doesn't include the Q&A. You'd have to find the transcripts for the Q&A elsewhere. After watching it one part really sticks out to me and you can find it about 25 minutes 30 seconds into the video. Here's the quote:
"A lot of people have told us, 'The Bumper solves the signal-strength problem.' Consumer Reports is the latest one this week. We've heard it from a lot of people. Why don't you just give everybody a case? Okay. Great, let's give everybody a case." - Steve Jobs
You really have to watch this quote to appreciate how the last line, "Okay. Great, let's give everybody a case." is dripping with disdain. Jobs seemed pretty forceful, even angry, during this whole presentation, but this part was exceptionally so. It's like Jobs sees this "free case" response as a concession and certainly isn't happy to announce it.
Why did Apple choose to give all iPhone 4 users a free case? I don't think the force of their presentation would have been lost had they omitted the free case. Since Apple can't handle even the current demand for their cases, using other vendors and reimbursing previously purchased cases will be complicated. It will cost them millions of dollars in lost revenue, arguably close to 100 million dollars. So why would they do it? I can think of two reasons:
- Apple wants to avoid jumping the shark.
- Apple wants to minimize their legal liability.
The first reason stems from Jobs repeated claim that this issue has been blown out of proportion by the news media and bloggers. Apple, like any company, wants to remain in favor with both media and their core customers, and responding to the market this way shows they care in a tangible way. I think this is reason enough, but Jobs utter contempt in announcing this "solution" makes me think this wasn't the driving force in the decision. If it was, he'd have presented it in a more upbeat manner.
I think the real reason for the free bumper concession was Apple's legal department. With class-action lawsuits being filed against Apple over the antenna problem, Apple's press conference today was more of a preemptive defense and a legal facts driven presentation than it was an attempt to quell the controversy. At such a high price tag, this preemptive and public defense, while painful, underscores just how successful they expect the iPhone 4 to be. There will be more iPhone 4 phones out there than any previous model and with that kind of large user base coupled with Apple's phenomenal success make them a larger target than ever. The sub-text behind today's presentation was a legal defense and that is why I think Jobs showed so much contempt for the free case give away.