HONG KONG – Leading computer maker Apple has just had to produce a new product specially for the China market — the iKowtow.
Tim Cook, Apple’s chief executive, responded to weeks of remorseless and concerted criticism in the official Chinese media with a groveling apology.
China attacked Apple for allegedly being “dishonest,” “greedy,” “incomparably arrogant,” as well as for having poor service and an anti-Chinese bias.
Cook admitted in a long letter in Chinese on the company’s local website that Apple “has much to learn about operating and communicating in China.” He added: “We are aware that owing to insufficient external communication, some consider Apple’s attitude to be arrogant, inattentive or indifferent to consumer feedback. We express our sincere apologies for causing consumers any misgivings or misunderstandings.”
Even though Cook apologized, the attack on Apple was sustained and concerted to such a degree that it must raise doubts about the way that China does business. Blogger Bill Bishop, who runs the excellent Sinocism China Newsletter, had correctly predicted that whatever the rights and wrongs of the case, China was following the classic recipe of “finding a kernel of truth and then blowing it into a mass media struggle session until the target bows down and pays obeisance. Whatever the merits, it was time for an iKowtow.”
The campaign started with a prime time special on March 15 by the state broadcaster China Central Television (CCTV) to mark consumer rights day. Apple was one of several companies, also including Volkswagen, accused of treating Chinese consumers unfairly.
The specific complaint was that Apple offered lower levels of service and charged for replacing back covers of faulty iPhones, whereas in other countries this was done for free. CCTV’s complaints were then taken up with by other state media, in which the People’s Daily played a growing role in launching front page editorial attacks on Apple calling on its readers to “Smash Apple’s ‘Incomparable’ arrogance.”
The campaign was also taken up on Sina Weibo in a clearly orchestrated campaign in which celebrities complained about Apple’s standards of service in line with the CCTV accusations.
Some of the accusations were vicious. Peter Ho, a Taiwanese actor, purportedly posted this complaint: “Apple plays so many tricks with its customer service. I feel hurt as an Apple fan. Have you done right by (Steve) Jobs? Have you done right by boys who sell their kidneys (to buy Apple products)? This is an example of big-name shops bullying customers. To publish around 8.20 p.m.”
Failure to remove the instruction about when to post the complaint, just after the CCTV program had been broadcast, roused suspicions. But then Peter Ho claimed that his account had been hijacked and that he was not the author.
Never let the facts get in the way of a good story. CNN Money carried a report from its Fortune associate, whose reporter took the trouble to read and compare and contrast Apple’s one-year limited U.S. warranty and its equivalent policies for China in Chinese.
“Although the language is different, I couldn’t find any policy differences between them,” reported Philip Elmer-DeWitt. “Both offer 14-day returns with full refunds. Both offer one-year warranties that either, at Apple’s discretion, (1) repair the defective product, (2) replace it with new or refurbished product or (3) return the customer’s money.
“Both guarantee replaced or repaired products for 90 days or the life of the original warranty, whichever is longer.”
If Apple is bad, other Chinese companies are far worse, particularly some of the country’s protected state-owned enterprises. That, as the Wall Street Journal was delighted to note, was the clear message when Caijing magazine polled its Weibo microblog followers.
“As a consumer, which arrogant company or companies do you want to smash?” Caijing asked, echoing the People’s Daily. “Please give specific names, so that we can announce a top 10.”
Wretched Apple did not make the top ranks. Instead, China’s telecom providers, its big banks, railways, electricity and water suppliers dominated the complaints, followed closely by the People’s Daily and state-owned media.
In China’s social media, some bloggers also made pungent comments. One wrote sarcastically: “Everybody is eating cooking oil recycled from gutters, no problem! Everybody is drinking poisonous milk powder, no problem! We drink water filled with dead floating pigs, no problem! But when you change the back cover of iPhones for foreigners but not for us, that is not OK, that is far more serious.”
Unabashed, the Chinese media kept up their campaign against Apple, with the People’s Daily running critical front page articles for five days in succession. The State Administration for Industry and Commerce (SAIC) added its clout by instructing trading standards bodies across the country to step up “contract supervision” on electronics manufacturers “such as Apple.”
According to the People’s Daily, the SAIC instruction said that, “Local governments are required to … investigate and punish illegal activities in accordance with the law.”
Apple hardly helped itself by its typically low-key response, denying the accusations and claiming that its warranties are more or less the same in countries worldwide. A company with ambitions, as new chief executive Tim Cook has announced, to see China surpass the United States as its biggest market should have been much more proactive, to use a modern buzzword.
It should be remembered that Apple has had its communication problems in Europe too, where justice commissioner Viviane Reding last month grumbled that Apple was failing to inform consumers about their legal warranty rights.
What is not clear is what China is hoping to gain by the goring of Apple. If it is not just an attempt to cut the company down to size and help Chinese companies, such as Lenovo, Huawei and ZTE, it could be that China sees itself as retaliating for U.S. restrictions against Chinese high-tech companies, such as Huawei.
It is easy to lament that China’s commercial playing field is not level as far as foreign players are concerned, and that Bill Bishop may be right in seeing the iKowtow as the quickest remedy. But the state-run Global Times the week before last did offer another way: Apple fans, it said, “if they do love this brand, they should let the truth emerge instead of joining the speculations.”
If Apple is as good as its fans claim, then Chinese are the biggest losers by putting obstacles in its path. Let the market speak.
Kevin Rafferty is the editor in chief of PlainWords Media.