The Rumor Game

Thursday, 6 January 2005

I still can’t quite figure out why Apple didn’t wait to file suit against Think Secret next week, after the Expo keynote and any new product announcements they plan to make — and I more or less left this question unanswered in yesterday’s coverage. My best guess now is that Think Secret’s rumors are accurate enough that Apple doesn’t mind fanning the flames, and figures that if they’ve lost the element of surprise, they might as well capitalize on the hype.

But first let’s just take a few moments to dispel any notions that Apple’s executives are in fact secretly happy about these leaks, or even more outlandish, the idea that Apple actually condoned or planned the leaks to Think Secret in the interests of generating hype, and that the legal maneuvering is just a ruse to generate more. Most companies would kill for this sort of publicity is the line of thinking that leads the conspiracy-minded to think such thoughts, but these theories are easily disproved.

For one thing, Think Secret’s previous reporting has clearly been detrimental to Apple’s interests — and depending on what Apple actually has to announce Tuesday morning, their recent reports regarding next week’s Expo could well prove detrimental to Apple as well. (More on this below.) The idea that Apple’s legal filings are nothing more than a PR sham is simply flat-out ludicrous. It’s admittedly conceivable that Apple might have colluded with Think Secret, planting these rumors on purpose, and then feigning indignance at the supposed “leaks” — but if this were the case, they would not be filing lawsuits. One does not use courts of law for PR stunts. It’s illegal to file bogus lawsuits.

One reason behind these suspicions of collusion is Think Secret’s supposedly amazing track record. But while indeed no other Mac rumor site has published anything close to as many scoops in recent months as Think Secret, their record is only “accurate” compared to the otherwise vapid Mac rumors landscape. Quite obviously, Think Secret has sources that other rumor sites do not. But these sources have not proved entirely accurate — at least by the standards of accuracy of a credible publication — and it’s the inaccuracies, and the resulting false expectations of Apple’s customers, which are most detrimental to Apple.

We need only go back one year for an example demonstrating both Think Secret’s less-than-accurate record, and how their inaccurate reporting damages Apple. On 23 December 2003, Think Secret reported the following:

Reliable sources inside and outside of Apple have confirmed Apple will announce the new pocket-size iPods in a number of capacities and in various colors, including stripes. Capacities will be 2 and 4GB — meaning users could store some 400 and 800 songs, respectively. Prices will start at around $100US, Think Secret has learned. It is not known if the new product line will be available immediately after introduction.

It is also expected that current iPod models will be revamped to add body colors as well.

A new line of “mini” iPods in multiple colors? Think Secret nailed that. But the capacities were off (there was no 2 GB model), the stripes were nowhere to be found, and, most importantly, the pricing was way wrong. The iPod Mini was unveiled at $249, but Think Secret’s pre-Expo reporting — which was as widely cited as this year’s reporting on the “headless” iMac — set expectations that they were going to sell for $100 or $150.

When Steve Jobs announced the $249 price during the keynote, the audience’s disappointment was palpable. If Think Secret had been in cahoots with Apple regarding this leak, surely the rumored price would have been higher than the real price, not lower.

In the long run, in the case of the iPod Mini, the “it’s too expensive” initial press coverage didn’t make much difference. The Mini proved popular enough that demand exceeded supply for most of the year; and even when production ramped up, it continued to sell well at $249. But it’s not hard to imagine that first-day reaction to the Mini would have been better had rumors not set the false expectation that they were going to sell for $100-150.

Some people imagine that Apple’s obsession with secrecy is merely a side effect of Steve Jobs’s personality; that Jobs, the consumate showman, turns petulant when his surprises are spoiled, and the only thing “damaged” by rumors is Jobs’s ego. Others take the “all publicity is good publicity” line when defending rumor sites. E.g. “Cult of Mac” author Leander Kahney, who, writing about the Apple lawsuit against Think Secret, writes:

After all, the rumored $500 iMac has been reported worldwide as a given by some of the biggest news organizations. More press is sure to follow. Lots more.

[…]

Despite Apple’s protestations to the contrary, it isn’t harmed by rumors. Quite the contrary: they help build great interest and excitement about Macworld.

But I fail to see the logic here. I don’t think the rumors generate any additional excitement for Macworld Expo. They generate excitement about specific rumored product announcements, but not the Expo in general. If there were no rumors about next week’s Expo — if we had no idea what to expect — wouldn’t the mystery about what Apple is set to announce drive an equivalent or even higher level of speculation and interest?

For most of the ’90s prior to Jobs’s return to Apple after the NeXT aquisition, Apple leaked like a sieve. Rumors sites published more information about upcoming Apple products than they do today, and their reports were generally more accurate. But there was less hype surrounding Macworld Expo. The rumor sites don’t build excitement for Macworld Expo, they take advantage of it. The excitement surrounding Macworld Expo in the Jobs 2.0 era is because of Apple’s — and Jobs’s — track record of debuting exciting new products at the show.

The Harm of False Rumors

More importantly — what happens when the rumors are wrong? False rumors can clearly hurt Apple.

Up until yesterday, I’d been thinking that it was likely that Think Secret was correct about the existence of the “headless” lower-cost Mac, but that they probably pulled the $499 price tag right out of their ass — just like they did last year with the iPod Mini “starting at $100”.

In the weeks leading up to a product announcement, it’s harder for Apple to keep hardware products secret, because the product has been released to manufacturing, marketing photos need to be taken, and so forth. The closer it gets to release, the more people there are who become aware of a secret new hardware product — or at least what it looks like. Whereas the price is something I suspect Apple’s executives can keep secret right up until the last moment.

[Nomenclatural Interpolation: I also question Think Secret’s speculation that this new $499 computer will be called an “iMac”. For one thing, the iMac brand has been synonymous with an all-in-one-display ever since the first 233 MHz bondi blue model. For another, it would completely break with Apple’s product-naming policies regarding CPUs. Once a family of Macs moves to a new processor architecture, all new machines in that family use the new processor. Now that the iMac G5 has shipped, it seems unlikely Apple would ship a “new” iMac G4. And, trust me, there is no fucking way Apple is releasing a G5-based iMac — screen or no screen — for only $499. So I’ll hazard a wild guess here that if Apple does indeed announce a lower-cost headless Macintosh next week, that it won’t be called an “iMac”. (But if I’m wrong, maybe it’s the “iMac Mini”?)]

The “it’s too expensive!” peanut gallery reaction when the Mini debuted last year was partly fueled by the low-cost expectations set by Think Secret’s rumor. I’ve been thinking the same thing could happen again — what if Apple’s plan for next week is to release a cool new “headless” Mac with decent specs, but at a price of, say, $699 or $799? If it had remained a secret, it might have been hailed immediately as a terrific new low-cost Mac. Or what if it is G5-based, but costs $999? If Apple unveils something at those prices Tuesday, the immediate reaction will be that it was “supposed” to have cost $499.

Or, what if the rumored cheap iMac and the new iWork office suite exist, but aren’t ready to be announced at Macworld next week? In which case post-keynote press coverage is likely to focus on what wasn’t announced, rather than what was. Clearly, this would be worse for Apple than if the products had remained secret until they were ready to be announced.

If that’s the case, however, I can’t understand why Apple would draw so much more attention to these rumors now. By filing this lawsuit pre-Expo, Apple has turned this into the most-hyped pre-Expo rumor frenzy I can recall, and seems to be indicating that it isn’t afraid of drawing additional attention to the “$499 iMac” rumor.

The only other explanation I can think of is that certain Apple executives — or at least one of them — are enraged. But I don’t buy it — the Jobs 2.0 regime has always struck me as the “don’t get mad, get even” sort.

There’s a reasonable case to be made that Think Secret has a right to publish these rumors. But it is unreasonable to believe that they don’t cause Apple any harm, simply because you enjoy reading the rumors.