This story has been updated with additional information on Apple's share price and analyst downgrades.
It is a splendid piece of financial media gold.
Earlier this year I published Google's 'Sneak Attack' Could Devastate 'Software Companies' Apple (AAPL) and Microsoft (MSFT). In that article, I noted that I had been wrong about Google. The company appeared (and still appears) positioned to challenge a dying Windows ecosystem and pass right by a relatively unambitious suite of Apple productivity software with its cloud-based offerings.
Even though this anecdote isn't about smartphones, I bring it up to show that I give Google its due as something beyond an advertising powerhouse.
Plus, it's important to consider the direction Apple might be moving in vis-a-vis software and services as it fires a grenade at Microsoft with free iWork on all new iPhone and iPad purchases. Because, at Apple, software and services intimately link to the company's dominant hardware. That doesn't mean Apple is a software company -- it's not -- but software matters because it could help keep the Mac/iOS halo effect strong. While nothing has changed at Microsoft, Apple has stepped up its game -- and will continue to -- on the software front.
It's at this juncture where Wahlman, as nice of a job as he does trashing Apple, makes several grave conceptual errors disguised as biting analysis.
First, he's obsessed with price.
Second -- and I say this in the most lovable way possible because I know, like and respect Anton -- he's a tech geek too busy comparing specs to consider the realities of the consumer marketplace.
Third, he's running with the talking point Apple can no longer innovate without taking a reflective and critical look.
The tech media set Apple up to artificially fail this week, treating rumors of a cheap iPhone as fact and subsequently ripping the company for not producing something it never even brought up in the first place. And this had material ripple effects. A chorus of Wall Street analysts downgraded the stock, sending it down more than 5% on Wednesday. For better or worse, Wahlman leads the misguided pile-on.
I'm not sure how many times we have to go over this before it sinks in.
Apple does not compete on price. It doesn't have to. It should not. And hopefully it never will.
Apple doesn't produce products like bunny rabbits on honeymoon just to grab marketshare domestically or in a place such as China. It doesn't have to. It should not. And hopefully it never will.
If you don't understand this -- and it's clear Wahlman doesn't -- it's difficult to take the rest of any argument you make seriously.
Less expensive does not always equal better, no matter how well a guy who knows tech specifications inside and out presents his argument. You can make a better case for the quality of a Nokia (NOK) Lumia or even Blackberry's (BBRY) Q10 than you can a silly Google Chromebook or Android phone, but neither can compete with Apple hardware.
This isn't like passing out free samples of Diet Coke after a concert or sporting event. There's more to it than opening up your operating system, undercutting on price and flooding the market. In fact, with this strategy in mind, we can take one of Wahlman's key points and turn it against itself:
Apple has many dilemmas. The biggest among them is that it's facing Android and Chrome competition from so many hardware players who move very quickly and with great diversity. You can get pretty much any kind of Android smartphone you want, in any size, with or without keyboard, stylus, this-or-that kind of camera, and so forth.
If Wahlman worked for Steve Jobs and expressed that viewpoint in private, let alone public, Jobs would have fired him faster than you can say 'Don't ask what I would do, just do what's right'.
The consumers and enterprises Apple attracts buy the company's devices, in part, because they don't perceive them as mass-produced, dime-a-dozen products churned and burned in a fragmentation frenzy. Perceive. That's the keyword.
Perception equals reality. And sometimes, perception is reality no matter how much that fact gets under a critic's skin.
In the long run and in the canons of history and corporate dominance, Android's market share doesn't mean a darn thing if nobody really knows they're buying a Google product. It's just a computer, like a Dell (DELL) or something else that lacks personality and relevance. Nobody notices and if they do, they don't care. There's no passion. No identification with what you own like there is with Apple's product-to-consumer relationship.
People love iPhones, iPads and MacBooks because Apple has given them too many reasons to count to love iPhones, iPads and MacBooks. Without doubt, Apple has established much of its cachet via best-in-class marketing, but the company's success has more to do with the fact that when you buy an Apple product you know you're getting a high-quality, thoughtfully-designed smartphone, tablet or computer that just works.
Unlike its competitors, Apple no longer has to work at earning such a reputation. It owns it. Now it must maintain it. There's no need for an iPhone, iPad or MacBook revolution. That's a sure fire approach to scare away almost automatic iPhone upgrades and consumers about to immerse themselves in the ecosystem with their second or third Apple product purchase. If it ain't broke, don't fix it, just improve it not-so-modestly with pesky little things like a twice-as-fast processor.
Along similar lines, if Apple engages in a price war -- the heart of Google's strategy -- it sends red flags to diehards and newcomers. Will I still be getting the great Apple experience I know or have heard so much about? Tim Cook would literally crush his company's soul if he made any move that dilutes the product, the brand and, most importantly, the broad experience of buying and using Apple products.
It's bad enough that he lets big boxes such as Walmart (WMT) and Best Buy (BBY) not only hawk Apple products, but put them on sale. Take it much further than that and Apple really does become just like every other company.
Qualitative, theoretical, and, if I went deeper, philosophical arguments pepper my view of Apple. I know that's difficult for many tech geeks and number crunchers to wrap their heads around, but it's crucial to understanding the Apple story.
And it's vital to not making the mistakes Wahlman made in his article ...
If these two new iPhone 5 models are all that Apple has, Google will then crush Apple in the coming months.
Apple doesn't operate at any pace other than the one it sets for itself. In that regard, it would need to know Google exists to laugh at it.
Yes, Apple absolutely does need a new and exciting spectacle. But it doesn't need it for any of the reasons Wahlman lists.
--Written by Rocco Pendola in Santa Monica, Calif.