Taking action before it’s forced to could be a smart move for Apple. Here’s why it isn’t.
Just as the public attention to “Battery-gate” was dying down (or is it?), Apple faced yet another controversy that has yet to earn a “-gate” name. Two large, institutional investors publicly called for the company to do something about the addictive nature of its products and the impact this has on the developing brains of children.
In a letter to Apple from Jana Partners LLC and the California State Teachers’ Retirement System, who together own about $2 billion worth of Apple stock, they said,
“There is a growing body of evidence that, for at least some of the most frequent young users, this may be having unintentional negative consequences,”
They then warned the company that,
“growing society unease…at some point is likely to impact even Apple.”
Apple’s response was measured, and reassured the world that Apple has taken this issue seriously and has had various parental controls in iOS for a while, and recently said they are going to work on more.
But is it enough? Should Apple consider doing more here? And the reality is, this is not really an Apple-specific issue as any smart phone or tablet maker could ultimately be impacted by this issue.
Two examples may help.
Toyota Unintended Acceleration
In the mid-2000s, Toyota vehicles started to be involved in accidents where the cars accelerated despite either the gas pedal not being pushed or even when the brake pedal was pushed, with one such accident leading to death of a family of four, including a California Highway Patrol officer. This is called Sudden Unintended Accerlation.
While Toyota’s initial response was that the only issue was driver error in not securing floor mats properly, more potential causes were brought in, including a claim that the electronic throttle control in Toyotas was the actual cause of the issue. Conclusive evidence of an issue was never found, even by NASA, and in accidents where people claimed they had been pressing the brake pedal, data recorders in the car showed the drivers were in fact pressing the gas pedal alone.
Toyota ended up recalling 10 million vehicles and issuing a stop sale across its line in 2010 despite there being no finding of an issue in a preemptive, proactive recall. That is, they stopped selling everything they made, even if the product was not implicated in the news on unintended acceleration.
They then introduced their Safety Sense feature set which puts many safety features other car makers consider options for higher end vehicle into the standard equipment list of even its cheapest vehicles.
It was not a good time for the company, and they’ve since paid over $2.5 billion in fines and law suit awards, including a fine to the US Department of Justice for covering up facts during the event.
While that all sounds bad, $2.5 billion is a drop in the bucket for Toyota, and the company is still thriving today.
In fact, brand-value ranking company Interbrand just named Toyota the most valuable car brand in the world in 2017. That is not the first time they have won this award, and are consistently one of the top three largest car makers globally.
The Toyota example suggests taking a proactive approach to a potentially wide spread problem is a wise path to choose. In fact, the negatives came from wavering they did, as that was the reason for the fines they paid, while the proactive moves are often cited in car comparisons where the Toyota models in the ranking have safety features others charge dearly for or do not even offer.
In 2003, a federal judge dismissed a lawsuit against McDonalds for causing obesity. Fast food and “Big Food” companies have long been vilified for selling addictive products that lead people to consume in excess, which drives the nation’s obesity and diabetes epidemic.
Do I wish unhealthy options were not as widely and readily available, and do I think restricting them would lead to a healthier population? Yes.
However, I also realize that this is exactly the point of selling food. You make it taste really good and your marketing is meant to make people desire it so they buy it. The onus is on us to choose whether we consume it, and in what quantity.
And apparently McDonalds felt the same way, and so did the judge hearing the case. McDonalds did nothing of consequence to change the healthiness of their food (yes, they added food facts and some salad options to their menu, but most of their menu continues to be unhealthy).
Consumer preferences are shifting, and McDonalds has struggled as these shifts occur. But the lawsuit did not lead to a direct threat to the company’s business model, and proactive response would have been hugely disruptive to the company’s very existence.
So What Should Apple Do?
I think Apple’s situation is closer to McDonald’s than Toyota’s. This is about the addictive nature of the product being harmful to our wellbeing, and hits on the question of who is to blame – the company for offering the product we struggle to stop consuming, or the consumer not controlling their consumption? And unlike the Toyota situation, this is not about Apple alone, as it was not really just about McDonald’s. Google, Facebook and others would be brought into the mix just as Frito-Lay, Yum!, Hershey, Kraft, Burger King and others would have been in the food debate.
Only time will tell, but I think Apple is making the right call at this time to offer ways to control usage. Now it is on us as users and parents of smaller users to control that usage.
This post is inspired by my best-selling book, “Do a Day: How to Live a Better Life Every Day” available in print, eBook and audio book formats. It originally appeared in my Inc.com column on January 24th, 2018.