Cross Cultural Management Apple, Inc.

Topics: IPhone, SIM lock, Mobile phone Pages: 12 (4097 words) Published: October 19, 2009
|Cross Cultural Management, IBA 1.6 | |Apple Inc. | |iPhone, exclusivity or availability |

| | |Suzanne Groeneveld - 1814044 | |Justin van der Graaf – 1864963 | |Daan Rottinghuis – 1722670 | | | |Team 5G | |Tutor: Ms. Driver-Zwartkruis | | | |[24-06-2009] |


A dilemma is the state of uncertainty when having to choose between two or more options. Both options are seemingly equally (un)attractive. Ultimately, the uncertainty between the options in which choosing for one you must forego the other, accounts for the emergence of the dilemma. In this either-or situation in which all companies find themselves in from time to time, a company will have to consider which of the options suits them best. In this case, we will examine the dilemma the technology company Apple, has recently been faced with. Steve Jobs, Ronald Wayne, and Steve Wozniak founded Apple in April 1976; a year later in June 1977 it was incorporated, without Wayne however. Since then, they have designed and manufactured many innovative and groundbreaking technological software and hardware products, the most popular being the Macintosh personal computers, the iPod and the iPhone. The revolutionary iPhone, combining the world’s most popular music player, a palm top computer and a phone into one hand-held gadget, was a thoroughly extraordinary device. Preceded by months of rumors, speculation and fake leaked-pictures, at last the start of 2007 saw Apple announcing the iPhone for release at the end of June. Of course, this device had required a lot research and development; bountiful financial backing was of course necessary to fund the project. The mobile phone network company known as AT&T Mobility, is estimated to have funded US$150 million over a time period of 30 months. In return for this substantial investment, AT&T Mobility were to receive exclusive carrier rights for the iPhone in the US. There is a SIM lock on iPhones sold in America, in theory obliging all US users to be contracted with AT&T. Obviously, the amount of mobile phone contracts at AT&T would rocket because of the immense hype surrounding the iPhone. Of course, this would be necessary to cover their initial investment in Apple; however, the investment is not in proportion with the revenues from the contracts sold, so Apple demanded an initial amount of US$240 per contract. Furthermore, each contract at AT&T was a two-year commitment, which is, of course, a relatively long time compared to a pay-as-you-talk or one-year commitment.

Identify the dilemma

Within a brief interval after the launch of the iPhone, it was made possible to unlock the iPhone, voiding the SIM-lock and making the iPhone compatible with other network carriers. So instead of activating the iPhone with AT&T immediately, the SIM lock could be removed and the contract with AT&T avoided. Internet forums and message boards aided...
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