The Macalope Weekly: Histrionics Lesson
It was a week of making mountains out of molehills, as jokes became dire threats and Apple held its customers hostage by making nice things they like to buy. Then it took the proceeds and paid its board to do nothing at all! It's a tale of three brouhahas.
Whenever Apple's involved, you can be sure that someone will take a sliver of a point and turn it into a gigantic hissy fit.
Fake Steve Jobs suggested iPhone users try to bring AT&T's data network to its knees on Friday, setting off some garment-rending of epic proportions.
The Macalope's not a big fan of stunts, so he's not really here to defend Fake Steve, but he's also not a fan of people going absolutely bananas over little or nothing. Take it away, David Coursey:
Suppose a 911 call is blocked by protestors jamming AT&T's network and someone is injured as a result?
The Macalope's no expert in cellular technology (he's more of an expert in people who write stupid things on the Internet) but this sounded like hogwash to him. As far as he knew, 911 calls get priority on the network, so how, exactly, would this occur? He asked Monica Paolini of Senza Fili Consulting, which specializes in wireless data technologies, who had this to say:
Interesting question -- it is true that 911 call get priority, but if the network goes down (as opposes to simply being congested) then no call goes through, including 911. I am not sure how likely it is that under a massive surge in usage (assuming for the sake of the argument that this is what will happen [Friday]) the network will go down entirely. It should not, but nobody has tested this directly as far as I know.
Sigh. Of course what the Macalope wanted to hear was "What?! No! What idiot wrote that?! That's the stupidest thing I've ever heard!" But you ask someone good at what they do and you get a nuanced answer that covers all the bases.
However, what Paolini is saying is that throwing bodies at this isn't going to cause 911 calls to cease to go through unless you reach critical mass and are able to completely crash AT&T's network. Fake Steve has a lot of readers, but he doesn't have that many.
Is it possible? Yes. Is it likely and the kind of thing to lose your composure over? N-
Lyons' should to [sic] call off this protest before somebody gets hurt as a result of it. And readers should avoid his blog until Lyons' apologizes for the mess he's created, perhaps unintentionally.
-o. Whoops, too late. Readers, apparently, are children who should not be exposed to dangerous ideas that may pervert their sensitive bodily humours.
Coursey does remember that Fake Steve is a parody site, right?
Strand Consult (motto: "You never heard of us until we said you had a mental disorder!") has come to the jacktastic conclusion that iPhone users have Stockholm Syndrome. You know, the thing where hostages start to identify with their captors.
Simply put, Apple has launched a beautiful phone with a fantastic user interface that has had a number of technological shortcomings that many iPhone users have accepted and defended, despite those shortcomings resulting in limitations in iPhone users' daily lives.
Strand goes on to conduct the usual flinging of stuff that should not be flung to see if any of it will stick and includes the requisite smattering of religious metaphors that are meant to ensure that the people trying to refute their boffo argument will be seen as "hard-core iPhone fanatics" who "worship" their phone (actual quotes!).
Do we defend the iPhone? Sure! We like it! It's good! Strand doesn't mention this but, despite its flaws, it's still demonstrably better than any other phone. And that, really, is the point we're trying to make, not to pretend that individual shortcomings do not exist.
At the bottom, Strand provides a helpful link to a page where you can sign up for their iPhone report. If the Macalope were cynical, he'd suggest that the incendiary piece was just an excuse to troll for contact information.
Which he is.
A study showing Apple board members are in the top three of the S&P 500 in terms of pay per board meeting prompted 24/7 Wall Street's Douglas McIntyre to say The Apple (AAPL) Board Members: $127,000 A Meeting To Do Nothing.
Two of the first are not terribly well-known -- Intuitive Surgical (NASDAQ:ISRG) and Nabors Industries (NYSE:NBR).
The third company is Apple...
Yooou know what thaaat means!
Out of the way, Intuitive Surgical and Nabors Industries! Pig pile on Apple!
The Apple board has a special function that is unlike that of any other board of a large US company.
ENGAGE HYPERBOLIC DRIVE!
The board does not run the company and probably gives management almost no guidance.
Most boards do not run the company--that's what management is for (WHY IS THE MACALOPE HAVING TO EXPLAIN THIS TO SOMEONE WHO COVERS WALL STREET?)--and McIntyre has no idea what kind of guidance the Apple board provides, he's just got an itch he wants to scratch.
Apple is and has been a "one man" operation under Steve Jobs since the initial success of the iPod in 2001.
Except for all those months he took off because he was sick. True story, though, he does all the soldering.
Apple's board members get more than $100,000 a year for hiding information and protecting Jobs. At least that is what the public record shows.
"I have absolutely no idea what I'm talking about, but I'm not going to let that stop me!" You can tell McIntyre typed this up fast because they got more than $100,000 a meeting, not a year. $100,000 a year?! That's chump change!
There's a number of key points McIntyre's leaving out of his screed. As Reuters points out but McIntyre doesn't think pertinent:
Shares of both Intuitive Surgical and Apple have more than doubled in 2009. Both companies pay directors largely with stock options, which have become especially valuable in light of their recent performance.
And that's how it should be. If you actually read the Reuters piece McIntyre pulled this from, the real offender is Nabors Industries, which paid out big bucks to board members despite having a bad year.
This whole to-do is a result of Reuters's decision to focus on the metric of total board compensation divided by number of meetings per year, which is its decision and not that of the Spencer Stuart Board Index, which compiled the report.
But that's not necessarily a good metric. Sure, board members have to work more when there are meetings, but that's not all they do. A Wall Street source of the Macalope's said he spent 15 to 20 percent of his time working on the board of one organization, and that can go up during times of economic crisis or, say, when the frickin' CEO is on extended leave.
This is not the first time McIntyre has gone around the bend of sanity and into the ditch of crazy because of Apple. In June he wondered if people buying iPhones on their credit cards were going to cause a new recession.
The Macalope is not overly fond of the executive compensation nuttery that goes on in this country. It's terrible. Are Apple board members overpaid? Maybe, but Apple's cash compensation to board members is actually very low. The reason Apple board members did so well this year is because Apple did so well. For the Macalope's money (and some of it is, in fact, his money), the bigger problem is paying executives lavish sums for poor performance.
But it's fun to pick on Apple because people like their products.
(Disclosure: the Macalope holds an insignificant number of Apple shares.)