The Surprising Way Apple's Supply Chain Reforms are Self-Interested
Apple, in a statement, said the company fully supported the monitoring group’s recommendations. "We think empowering workers and helping them understand their rights is essential. Our team has been working for years to educate workers, improve conditions and make Apple’s supply chain a model for the industry, which is why we asked the F.L.A. to conduct these audits."
Setting aside humanitarian issues, let's consider this purely from a business perspective. Apple asked for these audits; it's taking initiative to make this happen. Why would Apple do this?

An answer is revealed in Apple's desire to be "a model for the industry".

What happens when the whole industry makes changes like this? Increased cost of labor.

And in the whole industry, Apple will be hurt the least by increased cost of labor. All of Apple's competitors will be hurt more. Increased cost of labor will give Apple a competitive edge over its lower-profit-margin, lower-average-sale-price rivals. (To learn more about Apple's financial situation, follow

Apple has a robust business with long term viability. Apple is a highly efficient creator of value. Apple benefits from cheap Chinese labor but does not require it to have a successful business. Labor costs will increase over time and Apple is already in a position to thrive in that future scenario.

Apple's rivals are inferior in these regards. They bring less value to the table and get more of their profit from the *temporary* low cost of labor. Their businesses are less sustainable going forward.

If Apple can accelerate labor cost increases, its rivals will have less time to adjust and more of them may fail.

In a free market, profits are always somewhat temporary. There is always pressure over time for progress. Companies must continuously innovate to keep up or their profits will decrease. The most efficient companies, the best value creators, and the best innovators will thrive , and companies doing nothing special will fade away.

Accelerating this process benefits the best companies and puts increased pressure on the worst ones.

John Rockefeller used this technique in the past. In some cases he lowered his prices to where he could make a profit but his competitors could not (source: ). This demonstrated to his inefficient competitors how their companies weren't good enough and didn't have a long term future without improving. He shortened the period of time that poor competitors could hang around.

By ending cheap labor early -- something the well-run Apple can easily afford but some of its competitors will struggle with -- Apple is, like Rockefeller, trying to more quickly remove *temporary*, *unsustainable* market conditions that prop up inferior competitors.

Some of Apple's critics are genuine humanitarians. But others dislike Apple in particular and wish to harm Apple. Ironically those critics may end up bankrupting some of Apple's competitors and strengthening Apple's position.

Apple genuinely values humanitarian interests but I wonder if Apple also sees the business advantage in more quickly ending the temporary condition of cheap labor that helps prop up its competitors' inferior business practices.

Elliot Temple | Permalink | Messages (3)

Apple Announcements Commentary

lame solar power virtue signaling.

97% watch customer satisfaction. so high!

the activity rings stuff is for manipulating passive people. i don’t use them.

watch OS 4 doesn’t look like a big change.

watch series 3 has built in cellular. big change. could go outside without your phone!?

watch to watch phone call to girl on paddle board out in the water was neat. apple has a good history of live demos (not pre-recorded), like when Steve called starbucks for real to demo the iphone.

umm they have a no-cellular series 3 watch you can buy. eww lol.

i wonder if i want to upgrade (i have the original sport). my original guess was i’d upgrade to series 4, but cellular is a big thing. but when do i actually want to leave my phone behind when i go out?

for lots of people, they listen to music when out, and they can stream that. but i listen to books. i need voice dream player or speedup player, plus enough disk space for the files. i doubt i’ll be able to do that with the watch right now.

so my initial thought is don’t upgrade.

apple tv update: i don’t really care. i don’t use a TV. and i don’t want to unless it reaches feature parity with VLC + bluetooth keyboard.

Sky game looks pretty neat. i can get it on iPad though.

Tim talking about iPhone now. i’m excited to find out if i want to upgrade my 6s! if i don’t, i expect to upgrade in a year instead.

iphone 8 gets true tone display stuff and some better aluminum and glass.

6-core cpu with 4 low power cores. better gpu and camera ofc. i don’t use camera a lot.

still have to get a plus (which i don’t want cuz of its size in my hand) for dual camera.

better video compression is good. some of that stuff will apply to desktop video creation.

Augmented Reality stuff is kinda neat but doesn’t look that useful to me currently.

the AR game strikes me as motion controls (like Wii) but even worse. it’s way more precise and fast and better to control games with buttons than waving your hands around or walking around a table. games like this aren’t very serious/competitive.

WIRELESS CHARGING. uhh there wasn’t much info on when/where i’d actually be able to use it.

64gb/256gb versions. price of 256 not mentioned. i wouldn’t get 64. i think it’s good they got it down to 2 options and the bottom one is good now. the minimum was 16 for a long time which was pretty shitty even for non-power-users.

don’t think i’ll buy this. no killer features. could just wait a year, no big deal.


edge to edge screen. glass back. dual camera. super retina display. OLED. might buy this!

home button replaced with gestures and Face ID.

i find find touch ID doesn’t always work for me and i have to type my PIN sometimes, which i don’t like that. Face ID might be more reliable for me, especially when sweaty from exercise.

heh @ emoji based on your own facial expression. ppl sure like facial expressions. (and many of them want me to use a webcam in my videos.)

+2 hrs battery life.

AirPower is a wireless charging mat that you can set your iphone x and apple watch 3 on. hm but i want to charge my watch by my bed and i more often charge my phone by my computer. so where would i put the charging mat?

ok so the BIG features i’d actually buy this for are the screen and face ID.

64/256 gb. price 999 and ??? for 256, they didn’t say it again. fuck this i’m pausing the video to look it up. 1150 for 256gb iphone x. same extra $150 for the 8.

well that’s not bad. there were rumors it’d be higher. that’s like the bottom end of the speculation.

that’s interesting cuz i thought i remembered paying only $100 to get a 256gb 10.5” ipad pro. so i checked. it’s 650/800 now for 64/256gb, but it was 650/750 on launch. they raised the price of the new ipad pros! so the 64->256gb is the same standard $150 used on iphones. (i’m a little disappointed cuz, remembering the price of that upgrade for ipad, i thought it might be the same on iphone!)

to check my memory, i found this article and you can see the 749 price in the picture:

wow! apple really rarely raises prices of stuff after launching it. like nothing else comes to mind for them ever doing that (except raising the price in some other other currency cuz of exchange rates).

so 1150 primarily for the larger screen while the phone is only a tiny bit bigger. secondarily, face id, faster cpu, better camera, 256gb (i have 128 now but my phone isn’t full, i feel confident 128 is ok for me for another year). i wonder if i’d get more RAM. looking it up... 6s has 2gb. iphone x has 3gb. (iphone 8 is 2gb, 8+ is 3gb).

apparently the RAM is also 10-15% faster.

hmmm idk about buying it. post your thoughts in the comments!

Elliot Temple | Permalink | Messages (5)