This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

How the Tech Web Frenzy Gets Apple Wrong

NEW YORK (TheStreet) -- Apple (AAPL - Get Report) does some interesting things that make it unique, frustrating and a great target to write about -- even if understanding is frequently limited.

First, Apple keeps secrets very well. That's a measure to afford customer surprise and delight -- plus maintain a competitive advantage. As a result, observers are excited about every tiny bit of news or rumor as they try to put the jigsaw puzzle pieces into place. When analysis goes astray, sometimes with agenda, the real story is lost.

Second, Apple doesn't allow itself to be maneuvered into technical arguments that could confuse the customer. Write something absolutely wrong about Apple, and you'll get silence, not a rebuttal. That infuriates many writers.

Third, Apple is a charismatic, enigmatic company with colorful employees. They're fun to write about. Observers, from afar, would hope that they could put into political context every personnel change. It often fails.

Finally, Apple is a company that makes delightful products and pleases its customers, but it controls its message very carefully through the media and seldom kowtows to them. The inability to manipulate Apple with their presumed power annoys many tech writers.

Basically, the drama surrounding Apple sells. Apple's opacity ends up turning many technical journalists into gossip columnists. It's all not far removed from the paparazzi who cover the British Royal Family or Hollywood stars, but because we couch our industry in the cloak of technology and acronyms, it's easy to rationalize that it's all a very legit, high-tech affair.

The Impact

The result of all this is that if Apple makes a mistake, it's suddenly huge news. But the fact is, Apple is a company comprised of human beings who are fallible and do make mistakes from time time. In the end, those mistakes are remedied and have not yet led to the complete collapse of Apple.

But there's drama in thinking those mistakes might.

There's also a social effect in the Mac Web. If one author is able to create a big sensation with an alluring story about Apple and is able to press the readers' hot buttons with an especially clever and catchy headline, the author gets a few minutes of fame. Then, in response, other sites get nervous. There's an Internet buzz of low hanging fruit, just waiting to be captured. In response, writers at other sites chime in, hoping to cash in.

Everyone wants a piece of the Apple action.

Worse, if a more considered and sober analysis is available, there is concern that it won't generate as much excitement. There is some mob psychology at work.

The Infamous Echo Chamber

There's a well-known technical name for this effect, the "echo chamber." Everyone echoes everyone else until the fires subside and then everyone moves on to the next drama. Needless to say, this leaves the readers dazed and cynical.

Finally, no writer wants to look like a doofus and be caught looking wrong-footed on the next technological revolution, so everyone is eager to see what Apple has up its sleeve, and everyone is eager to see if other companies are geting it right by comparison. That's why Jay Yarow could write this about Google Glass:

"After reading all the reviews, and talking to people who actually wore Glass, I just see a product plagued by bugs, and of questionable use, that's generating a lot of buzz because people want so desperately to have some new gadget to latch onto, and fear being wrong about the next major technology trend."

Jumping on those various tech bandwagons is another aspect of the echo chamber.

If you want to really understand Apple, it's important to follow experienced, courageous authors who understand Apple, not sensational headlines.

As I mentioned above, there are many writers and indeed whole Web sites that don't care for Apple. And so, they're not willing to let Apple lead the way. They make up their own alternative, fantasy future and sell it.

Meanwhile, Apple employees, who stay pretty busy, are greatly amused when they occasionally look in on these affairs.

At the time of publication the author is long AAPL.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.99 0.00%
FB $102.01 0.00%
GOOG $682.40 0.00%
TSLA $151.04 0.00%
YHOO $27.04 0.00%


Chart of I:DJI
DOW 15,973.84 +313.66 2.00%
S&P 500 1,864.78 +35.70 1.95%
NASDAQ 4,337.5120 +70.6750 1.66%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs