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Apple's Lost iPhone an Island-Worthy Mystery

By Renay San Miguel MacNewsWorld ECT News Network
Apr 20, 2010 2:53 PM PT

Maybe it's karma for the way Apple has dealt out restrictions on its App Store developers lately. Or it could be the mother of all technology marketing stunts, coming a week after a competitor releases a well-reviewed smartphone.

Apple's Lost iPhone an Island-Worthy Mystery

In any event, Apple may have lost more than a prototype fourth-generation iPhone, left behind in a Silicon Valley bar by an employee whose name everyone now knows thanks to a popular tech blog. A company whose penchant for secrecy is rivaled only by the CIA, the former KGB and those writing the last episode of "Lost" may have indeed suffered an embarrassing security breach. Yet if the iPhone in question was deliberately released into the wild for whatever reason -- early buzz generation, gauging technosphere reaction, an elaborate psych-out for its rivals -- Steve Jobs' company may also see a backlash from the same tech writers/bloggers who have made Apple fact and rumor analysis a vibrant subculture on the Internet.

Apple lent weight to the argument that human error is responsible for the misplaced phone on Tuesday, when it sent a letter to tech blog Gizmodo demanding the iPhone's return to the company. Gizmodo admitted to having paid US$5,000 to the person who scooped up the lost smartphone at the Gourmet Haus Staudt beer garden in Redwood City, Calif. The New York Times quotes an unnamed source close to Apple confirming the phone is a legitimate company product.

Apple spokesman Steve Dowling told MacNewsWorld that his company would have no comment.

Why a Stunt?

In a blog post titled "The Apple 4G iPhone Prototype is Probably a Head Fake," Edelman Digital senior vice president/director of insights Steve Rubel wrote that the phone may indeed be a prototype, but that doesn't necessarily mean its the new iPhone 4G expected to be unveiled at the Worldwide Developer Conference in June. "It's been reported that Apple allegedly has teams in the company working on prototypes that will never see the light of day," Rubel wrote. "It does so, it's been said, to maintain secrecy and to occasionally throw people off the trail. That's what I think is happening here.

"I believe Apple made this device. It seems very authentic, and Gizmodo has done a great reporting job. However, more importantly, I believe this is probably a false prototype that someone from Apple either left in the bar intentionally or with an individual who they thought might do so for reasons only they know. We'll find out for sure probably this summer, but that's my educated guess as a continuous student of PR," he added.

"It sure does smell like a stunt to me," said Rick Chapman, publisher/managing editor of Softletter and a former tech marketing executive who wrote In Search of Stupidity: Over 20 Years of High-Tech Marketing Disasters.

There's little doubt that Apple has several prototypes of a new iPhone floating around on campus, according to Chapman. However, he added that he doesn't see the point of engaging in such a gimmick. "If it was designed to get everybody hot and bothered about the iPhone, it sure didn't do it. It's a little thinner and pretty much the same size. It looks to be a logical evolutionary extension of the existing line. There's nothing they can do that would be really revolutionary.

"If it was a stunt, it was poorly executed," Chapman told MacNewsWorld.

Apple Damage Self-Inflicted?

Would Apple let one of its prototypes go just to steal thunder from HTC, which got positive reviews for its Android-based Incredible smartphone last week? The initial goal may have been to drown out the noise involving a competing product, said Marcus Cunha, associate professor of marketing at the University of Washington's Foster School of Business. However, that's still a roll of the dice for Apple.

"It may make people who were planning to buy the iPhone now wait for the new release. In this case, Apple would be cannibalizing revenue," Cunha told MacNewsWorld. "Another reason why it might not be a great idea to do the stunt now is because it would shift the media focus away from the iPad, which seems to be their marketing focus right now."

Yet rumors of a new iPhone were already working their way through the technosphere even before the "lost iPhone" weekend; Apple has been refreshing on a yearly basis, so why would 2010 be any different?

Apple wanting the phone back from Gizmodo doesn't necessarily prove that it's the final release product, said 451 Group Research Director Chris Hazelton. However, "it does show Apple's interest in preventing competitors from looking closely at it. Competing tech vendors could tear it down even further to learn more. The components are the big hint. It would be a very expensive hoax for someone to build this. The device uses a Micro-SIM card. The iPad is the only other consumer mobile device using this standard right now."

Those competitors now know that Apple has built an iPhone with a forward-looking camera shooting 8-megapixel photos and a glass/ceramic backing that would be less of an impediment to radio waves. Differences in hard-button placement on the phone may mean one of them could be used for the camera. "That will mean people will start to leverage the iPhone as more of their primary camera," Hazelton told MacNewsWorld.

Spinning a Company Foul-Up

The technosophere is full of people who are more than willing to offer conjecture on Apple's forthcoming products. Marketing specialists seem also eager to give media relations advice to Apple on how they should spin an employee losing a super-secret prototype -- in a bar, of all places.

"If you're Apple, you want to have control. By getting the phone back, they exercise control over the story," said Neal Burns, professor at the University of Texas' advertising department and director of its Center for Brand Research. "They can get control over the narrative. They can say they were letting some low-level employees carry this around and do some reasonable market exploration. If it's certainly not something they're going to market with, what they have to do is pooh-pooh this as an older model [prototype] and that's the only reason he was carrying it," Burns told MacNewsWorld.

Another approach, offered by Chapman, is one that might help to dissipate the negative publicity arising from new developer restrictions on the iPhone OS 4 and the revelation that a Pulitzer Prize-winning editorial cartoonist had his application banned from the App Store because it made fun of public figures -- a quality that readers usually expect in an editorial cartoonist. (The cartoonist has since had his app approved.)

"I would use this to show a more human face. Have some fun, maybe let the cosmic universe puncture your balloon a little and let that bad karma drain away," Chapman said. "Make fun of yourself, have fun with it. There's nothing else they can do. Walking around with a tight ass is not going to endear you to anyone. If it's a screw-up, say it was a screw-up."

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