02 Oct Apple Maps: Decision by Wall Street?
Just as we all start to get sick of reading and debating the Apple Maps debacle, a new interesting thread, issue, or new piece of information comes up. This time, it was, Apple’s CEO Tim Cook apologizing for the lousy experience Apple Maps delivers. You should put to rest the debate on whether it’s a good experience or not as it is per Apple’s own admission. I applaud Apple for its admission, but Apple should never shipped it. From a company who has defined itself by delivering the best experiences, why was there a decision made to ship a sub optimal experience?
Apple redefined for the entire technology industry what the word “experience” means. While There may be some debate debate if Apple has redefined the personal computer, There’s no one who can legitimately argue that Apple did not do this for the smart phone and even the tablet.
This is why it is just so odd as to why Apple would allow this low-quality map application to be released in the first place.
There are really only two different and mutually exclusive ways this can be explained:
1) Apple forgot how to deliver and evaluate a good experience. Essentially this scenario says that Apple, after delivering great mobile experiences for years, forgot how to do that and how to measure it.
2) Apple knew they were delivering a poor experience and decided to ship the iPhone 5 and iOS 6 anyways. they would deal with the consequences afterwards.
Any reasonable person who follows technology closely must know that it’s the second option.
This then gets to the decision making process. Anyone who has ever spent any time in product management knows that near the launch of a product, you have many launch readiness reviews. Apple may call their review something different, but they have something like it. It involves cross functional teams, typically including product management, product marketing, program management, engineering, manufacturing and operations. Each group goes through their review, one after the other. These types of meetings essentially compare the minimum launch criteria with the current state of the product. The outcome of this meeting determines if the product is ready to ship or not and the critical actions to close the gap. The most senior executives rarely attend these meetings, but are sought afterwards for escalation If there are issues.
You can bet that Apple maps was reviewed and scrutinized over and over and over. You can assume some people said that the experience was good enough to ship and there were those who said Apple maps was not ready to be shipped. The decision probably came down to Tim Cook himself, who opted to ship a sub-optimal Apple maps experience.
Tim Cook had a very difficult decision to make in that none of them resulted in anything optimal. He had to choose between:
1) Ship a sub optimal experience coincident with the launch of the iPhone 5, “hitting” commit dates made to Wall Street, press and retailers. With this decision Apple would potentially take the heat from consumers and the press.2) Delay shipping the iPhone 5 until Apple Maps delivered a good experience. This would raise the ire of Wall Street and investors. As we have seen over the last two weeks, Even though Apple shipped millions of the new iPhone five, it still wasn’t good enough for much of Wall Street. Imagine, if the iPhone five were delayed by a few months. Imagine what that would’ve done to the stock price.
So how did it work out for Apple? Short-term, it worked out pretty well if you measure in terms of sales. They sold 5 million iPhone 5s the first weekend and 100M ungraded to iOS 6. Apple’s stock hit a massive hit this week, but it’s unclear to say if Apple Maps were the culprit, if it was financial analyst expectation versus how many they sold, or fears of production issues. It was a combination of all of these. Apple’s reputation has surely taken a hit but it’s unknown if it will have any lasting impact. Apple’s prior issues with products stemming from things like iPhone antennas, MobileMe, and Ping barely made a brand scratch and was followed up by record selling products. I do believe that people will start to question brand-new things that Apple gets into that are related to their core competencies. These are could be markets like search and products like TVs.
So why was the decision made to ship a lousy Apple Maps experience? As we’ve seen Apple’s stock get hammered as of late, it was about the stock price. Imagine if Apple had delayed shipping the Phone 5. The stock would have been hammered even harder. Therefore, Apple’s Tim Cook probably made the right short-term business and stock decision even if it wasn’t in the best interests of its customers. You see, brands have half-lives, and while Apple cannot have a string of incidents like Apple Maps, it can afford this one in isolation. Tim Cook, Wall Street thanks you. Apple Maps users, not so much.