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December 22, 2006

Apple, The NY Times, & Me... Really

Several years ago I caught wind of a new musical device called an i-Pod. I thought it was neat. Actually, I thought it was more than neat. I thought it was brilliant and potentially huge. Physically, it was a beautiful object: white, silky, sleek and sexy, and the entire software package, so simple to use, so elegant, and in typical Apple fashion, so well conceived--I'm a big Apple fan--and frankly, I didn't see how it could fail.

Famous last words, right?

And then I read the New York Times review (Oct. 23, 2001) of the i-Pod. Here's David Pogue's final word:

"If Apple ever lowers the i-Pod's price and develops Windows software for it, watch out: the invasion of the i-Pod people will surely begin in earnest."

In a nanosecond, this is what whizzed through my mind:

1. Lower the price? Is he crazy? David Pogue obviously does not have children who are teenagers. Kids want to pay more for a fashion item.

2. Windows software? Huh? So the device won't work.

Pogue is not stupid, but he is clueless.

I knew, I mean right then and there, I knew the i-Pod was going to go right through the stratosphere. It also occured to me that once people got into the i-Pod they might, they just might start drifting over to Apple Computers and Apple software, which is far superior to PC Windows software that dominates the world-wide marketplace.

I called my stockbroker and told him to buy a few thousand shares of Apple stock.

Poor guy, I could feel him sweating bullets over the phone. My stockbroker is not some mercenary trying to bleed us through numerous sales-commissions. He's a mensch, a close friend from shul who actually wants us to make lots and lots of money in the market.

"Are you sure, Robert? Our analysts are, er, in a sell position on Apple."
"Please, buy."
He cleared his throat and stated in the most formal of tones, as if addressing the House of Lords: "Robert, I'd like to go on the record as warning you that this is a high-risk purchase."

Today, my stockbroker thinks I'm a genius. I'm not. I just have common sense. For instance, most rock albums are built around one good song. The genius of i-Tunes was the $1.00 purchase of a single song. No longer was the consumer forced to buy an entire dopey album.

Needless to say Apple stock has doubled, tripled, increased our portfolio's value -- hugely. And yes, my instinct was to some extenct correct; consumers are discovering that Apple computers, hence Apple software is the way to go. Your computer life does not, I repeat does not have to be dominated by viruses, by worms, by trojans, and by clunky software programs that do not interface properly, if ever.

I have not seen Microsoft's new software release Windows Vista, but I can guarantee that its most creative and useful features have almost certainly been, ahem, borrowed from Apple's splendid software Panther, Tiger, and the soon to be released, Leopard, all from Apple's rock solid OS X system.

Posted by Robert J. Avrech at December 22, 2006 09:21 AM

Comments

Seraphic Secret is private property, that's right, it's an extension of our home, and as such, Karen and I have instituted two Seraphic Rules and we ask commentors to act respectfully.

1. No profanity.

2. No Israel bashing. We debate, we discuss, we are respectful. You know what Israel bashing is. The world is full of it. Seraphic Secret is one of the few places in the world that will not tolerate this form of anti-Semitism.

That's it. Break either of these rules and you will be banned.

So true. Whenever I pick up a copy of the Times these days, I'm struck by how irrelevant it seems.

Posted by: Tamara at December 22, 2006 11:00 AM

Tamara:

Irrelevant, except to jihadists.

For instance, today on the front page The N.Y. Times published an story detailing the structural vulnerabilties of the Holland Tunnel. It's a playbook of how to bring down this structure and kill countless civilians.

This article is a gift to terrorists, and constitutes one more instance of sedition on the part of these irresponsible elitist fools.

Have a lovely and meaningful Shabbos.

Posted by: Robert J. Avrech [TypeKey Profile Page] at December 22, 2006 12:45 PM

I don't get it. You call me and the paper "clueless"--but for what? It turns out that my review was EXACTLY right! And just as prescient as your brilliant investment.

Apple DID lower the price, DID make a Windows version of the iPod, and that DID open the floodgates.

Are you saying that the iPod would have become a global phenomenon if it remained a Mac-only accessory? That I seriously doubt.

As for this: "I have not seen Microsoft's new software release Windows Vista, but I can guarantee that its most creative and useful features have almost certainly been, ahem, borrowed from Apple"

I guess that makes both of us clueless, eh?

(My Times review of Vista: http://query.nytimes.com/gst/fullpage.html?res=9B02EED71531F937A25751C1A9609C8B63


My video making the same point: http://www.youtube.com/watch?v=QT6YO30GhmQ

...)

--David Pogue

Posted by: David Pogue at December 22, 2006 02:26 PM

David:

Thanks so much for your comment.

I guess I didn't make myself clear. When I said "clueless" I was speaking of and in that moment -- in the past tense.

I felt that the i-Pod's high-price and exclusivity were the key to its success. I was right. But so were you.

I should have been more generous and pointed out how correct you were in the long run. For this I apologize.

Posted by: Robert J. Avrech [TypeKey Profile Page] at December 23, 2006 06:29 PM

Okay, how cool is it that the actual Times writer commented here? I like his sense of humor too.

Posted by: Jake at December 23, 2006 08:08 PM

Jake:

I have labeled the NY Times a jihadist paper.

I have called Steven Erlanger the official spokesman for Hamas.

I have compared the liberals who dominate the Times newsroom to the appeasers of Europe who licked Hitler's boots and had the moral backbone of jellyfish.

I have accused the publishers of the NY Times of committing sedition, of being a bunch of Jew-haters.

Not one word.

The very first time I write one word about technology and their tech writer -- he's all over me in about ten minutes.

Go figure.

Posted by: Robert J. Avrech [TypeKey Profile Page] at December 23, 2006 08:53 PM

shavuah tov,

there was actually an article in the wall street journal this morning about apple's next expected big move: an ipod phone. so what do you say, should i buy some apple stock?

i bought my first mp3 player a few months ago. i avoided the ipod for a number of reasons. instead a bought a competitor that was much better priced and had many more features. i returned it after 2 days and then went to costco to buy the new 80gb ipod. (i almost bought a nano, but i'm i glad i didn't. they look too girly, especially next to my 80gb.)

Posted by: Ari Kinsberg at December 23, 2006 09:19 PM

i had the journal email you the article.

Posted by: Ari Kinsberg at December 23, 2006 09:24 PM

Ari:

I've been tracking the i-Pod phone for a few years. Wall Street says that the cell phone business stinks. But here's the thing: if the i-Pod phone works, it will be a huge fashion item for the same kids who made the i-Pod such a glorious hit -- and then watch out, the i-Pod phone will be poised to redefine the technology.

I do not give financial advice.

If I told you to buy and G-d forbid you lost money, then you'd hate me. If I told you not to buy and the stock soared, you'd hate me.

My advice: study the product, talk to people who know how the stock market works, and then proceed cautiously with a conservative financial plan.

Thanks so much for the link. Will read ASAP.

Posted by: Robert J. Avrech [TypeKey Profile Page] at December 23, 2006 09:37 PM

Ooh. How much Apple stock did you buy? And at what price? (Well, if you like just tell me the price).

I felt that the i-Pod's high-price and exclusivity were the key to its success.

No, I wouldn't say that they were the key. What was the key was that it was a really great product. Great functionality and great design. The initial high price reflected that, and Apple understood that people (even or perhaps especially teenagers) would pay a large sum for what they perceived as a really high quality product when they wouldn't pay a smaller sum for a low quality product. The high price may have signalled quality and cool, but it would have done for no more than two minutes if the product had not lived up to it.

Read this piece about the forthcoming iPhone and laugh. It appears to be saying that the cellphone business is really strange and pathological and because Apple doesn't understand its rules it is going to fail dismally. I actually think that Apple does understand the rules, and is more interested in changing them than playing by them. I would argue that the fact that the cellphone business is warped and pathological provides tremendous opportunities for people introducing better products rather than the reverse. It almost makes me want to buy Apple stock now, although at $82 a share most of the money may have been made by people like you already.

By the way, I bought myself a new iPod yesterday, my old one having become erratic after a lot of wear and tear. Judging by the signs outside shops saying things like "We will have more iPods in this afternoon but are out of stock now" and the fact that I have to visit three shops before finding the (high end) model I wanted, Apple appears to be having another terrific Christmas.

Posted by: Michael Jennings at December 23, 2006 10:30 PM

Robert:

Pogue's response and his good humor without backing down too much is indicative of what I've said about journalism for a long time: if you want to find decency and smarts, you have to stick with the business and sports reporters. You'll never get a response from the amateurs reporting politics, who consider themselves experts because they know a few officials' phone numbers, etc. If only we required all our reporters to be as well-versed in their subjects as the guy who covers the Lakers.

Posted by: Jake at December 24, 2006 06:29 AM

Michael:

I don't have the number in front of me, but I believe I bought at something like $12 a share. And then I kept buying for the next few years even as it climbed.

And of course the key to the i-Pid's success is that it is an amazing product, probaby the electronic product of the decade. That goes without saying. I still maintain that the high price and exclusive software was key to its success. As David Pogue correctly pointed out, Apple did develop Windows software for the i-Pod, but that was only later, after the i-Pod made the big break-through, and the price drops are really only very recent.

Thanks for the link. I'm going to weigh in on this matter. I have been giving it a great deal of thought and come to some conclusions of my own.

Posted by: Robert J. Avrech [TypeKey Profile Page] at December 24, 2006 09:55 AM

Jake:

You're absolutely right. The political reporters are a gutless bunch.

Pogue has all my respect.

And his video had me on the floor laughing.

Posted by: Robert J. Avrech [TypeKey Profile Page] at December 24, 2006 10:47 AM

Jake--It's funny you said that because I just told my husband (who is getting his degree in journalism) that all journalism majors should be required to have a minor in a different field. In most sections of the paper (beyond the business and sports sections you mentioned) it is patently obvious that the reporter who wrote the article has no clue about the subject on which they are reporting.

Posted by: Fern R at December 24, 2006 11:00 AM

Fern:

A minor in another subject would help, but we can't rely on academia to impart real knowledge. I mean would a sports reporter be worth beans if he learned about the NFL in the classroom? No, he or she needs to be a real fan first, go to the games, hang out with other fans, etc. 99% of the journalists on ESPN do just that.

Political reporters? 99% of them don't even speak the languages of the Middle East. Imagine covering a football game and needing a translator to explain to you what the shotgun formation is. This is what we're dealing with in journalism today.

Posted by: Jake at December 24, 2006 05:31 PM

Jake--That's a good point. The only problem is finding people who qualify. I'm sure newspapers would love to hire reporters who can speak Arabic, Farsi, Hebrew, etc. And even better, someone who speaks a Middle Eastern language and has lived in the Middle East for an extended period of time. The problem is that people with those skills can earn a much more lucrative living in other professions. At least someone who has studied the Middle East in college will have a decent context in which to put the information they gather.

Posted by: Fern R at December 24, 2006 07:40 PM

Fern:

That's true sometimes, but I actually know a lot of underpaid Middle Eastern language speakers who'd jump at such a job. And here's a little secret: I also know a lot of people who would take a pay cut to get their names in the paper or their faces on TV regularly. I still get calls from my lawyer and doctor friends from time to time wondering if they could become reporters on CNN. When I tell them they'll be making a lot less than they do now, they don't care. They all want to be the next Dr. Sanjay Gupta or Jeffrey Toobin.

The point is top papers and TV networks have no excuse for hiring amateurs. But they do it all the time... except in sports and business where the seasoned readers would run neophytes out of town on a rail.

Posted by: Jake at December 25, 2006 05:58 AM

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