Yes, I know you are expecting me to post about all of the new Apple products announced today during the Stevenote at Macworld 2007.
I will definitely post on them tonight and tomorrow, as I’m going to Macworld in person to see them tomorrow afternoon. It’s my annual birthday treat.
Still, despite all of the excitement, I thought I’d post a few worthwhile articles on the ongoing developments in the Apple options backdating scandal. I find the scandal particularly interesting because:
- I know some of the people now mentioned in the investigation
- I worked at Apple in the time period where the alleged abuses occurred
- I am a lifelong fan of the company and its products
I do not own any shares in Apple Computer (sorry, now it’s “Apple, Inc”). But I think people who do need to follow this ongoing development with their eyes wide open.
- Ben Stein, “So Many Millions, So Little Body Armor“, New York Times
- Christopher Walen, “Why Steve Jobs Should Resign“, Seeking Alpha
- George Gutowski, “Apple’s Option Scapegoat: Meet Ms. Wendy Howell“, Seeking Alpha
I find the last article troubling in particular, because I knew Wendy Howell when I was at Apple. I didn’t know her well, but I knew her, and it’s shocking to see someone’s name in the press like this.
I haven’t fully digested my thoughts on the scandal, or formed a final opinion about what should happen. But this much seems clear – every announcement and release seems to reveal more and more “issues” and more direct involvement by executives, including Steve.
At the same time, it’s hard to argue that Steve & team have not created far more value for the company in the past 10 years than these transgressions may have caused. Steve has increased the market value of Apple by literally $50 Billion+, and compared to other executives in similar positions, seems to have actually taken a surprising low % of those gains for himself. In fact, you could argue he has literally charted a new course for the entire consumer electronics industry at this point in regards to digital media.
There is also no doubt that going forward, Steve is absolutely the value maximizing person to run this company for the next 10 years. No question.
That leaves Apple shareholders with an interesting question: do they impeach their leader on this arguably minor infraction? Or, will they issue a full pardon? (I apologize for the political mixed metaphor)
I think Apple is making this situation worse by not effectively admitting the mistake, and apologizing for it completely. They are turning this into the type of theoretical ethical issue that is just too juicy for the media to give up on. I think the complete absolution of Jobs by Al Gore & Jerome York may have actually stirred things up more, given the revelation of email from Jobs on setting the timing of the option grants. The inclusion of Pixar in the investigation is also troubling.
Make no mistake – this drama will peak in 2007.