Apple’s Poor Communication Regarding CEO Steve Jobs’ Health

What happened?Apple CEO Steve Jobs had cancer in 2004He had surgery to remove the tumor; deemed

successfulIn August 2006, Jobs appeared unhealthy at

the WWDCSpeculation of a recurrence begins

Apple’s ResponseKatie Cotton, VP of Worldwide Corporate

Communications, responded to inquires stating,

“Steve’s health is robust and we have no ideas where these rumors are coming from” (Claburn, 2006)

Speculation continued, but began to diminishUntil…

2008 Worldwide Developer Conference

June 9, 2008 WWDC, Jobs appeared looking “gaunt” again, refueling debate of his health

2008 Worldwide Developer Conference

2008 Worldwide Developer Conference

2008 Worldwide Developer Conference

Apple’s ResponseHis appearance is the result of a “common

bug” (Krazit, 2009)

Obviously this didn’t satisfy people’s concerns

January 2009Jobs emails employees claiming he is

suffering from a “protein deficiency”He also says that he has already begun

treatment, and that it is very simple

January 14, Jobs announces his health problems are more serious than originally believed, and that he would be taking a leave of absence until June 2009 (Krazit, 2009)

Is this affecting Apple’s Reputation?

When Jobs announced his leave of absence, Apple shares dropped 10.8%

This is evident of his enormous importance to the company

Apple is Steve Jobs, and Steve Jobs is Apple

Is Jobs’ Health a Private Matter?Steve Wozniak, Apple Co-founder speaks

about Jobs’ health

Investors need to know about his health because he has such an impact on the company

He has chosen to be the image of the company, and therefore has taken on this responsibility

http://www.youtube.com/watch?v=uADE-gbsxGg

Steve Jobs IS Apple!WWDC 2008 Steve Jobs Keynotehttp://www.youtube.com/watch?v=dGY28Qbj

76A

Apple FailedInaction has led to much speculation, only

further perpetuating concerns of Jobs’ health.Poor media relations have resulted in an upset

media, frustrated with the lack of available information

Inconsistencies have created a lack of trust in the media, something Apple has always been bad about

The constant speculation in the media has created dissonance in investors, leading to stock fluctuations

How much will this hurt Apple?We will have to wait to seeEven though they did a poor job, the Apple

brand is extremely resilient, and the stock is doing well.

Apple TodayApple’s stock is currently sitting at $133

(AAPL)The stock bottomed out at about $80

This is harder to judge due to the overall state of the economy

That being said, Apple is outperforming their competitors, and it appears the brand will be rather unharmed

Apple TodayThere is no doubt that Steve Jobs is still very

active in big decisions like product development

He is due back in JuneThis timing is perfect for him to announce a

new productThere is growing speculation, becoming close

to certainty, that a new iPhone will be released this summer.

SummaryI think Apple did (and continues to do) a

terrible job of handling this PR incidentI don’t think it will have a lasting impact – the

brand is too strong

Piper Jaffray analyst Gene Munster said it best, “Apple investors need to look at the big picture. They need to look at the new products, the balance sheet… this is a storm that will pass,” (Kawamoto Apple, 2009)

ReferencesKrazit, T. (2009, January 5). Steve Jobs' health now a

public matter | Apple - CNET News. Retrieved March 24, 2009, from http://news.cnet.com/steve-jobs-health-now-a-public-matter/

Kawamoto, D. (2009, January 14). Apple shares plummet on news of Jobs' medical leave | Apple - CNET News. Retrieved March 24, 2009, from http://news.cnet.com/8301-13579_3-10143000-37.html?tag=mncol

Claburn, T. (2006, August 11). Steve Jobs Lives! - Digital Life Blog - InformationWeek. Retrieved April 8, 2009, from http://www.informationweek.com/blog/main/archives/2006/08/steve_jobs_live.html

AAPL - Apple Inc. - Google Finance. (n.d.). Retrieved April 6, 2009, from http://www.google.com/finance?client=ob&q=NASDAQ:AAPL