Daniel Eran Dilger
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Mike Elgan’s Moronic Tirade on the iPhone

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Daniel Eran Dilger
Who would have thought Computerworld’s Mike Elgan, the former editor of Windows Magazine and an incessantly badgering Apple complainer, would feel compelled to excitedly report on the future of Apple’s iPhone product line?

Just as the ignorant tech media can manage to put absurdly negative headlines on great news, Computerworld proved it can deliver an ignorant, negative, rambling, uninformed rant under a false label suggesting a positive outlook: “A new iPhone this Summer: Everybody’s freaking out about Apple’s iPhone sales, but look closely enough and you’ll find good news.”

Why is a leading Apple hater with a documented history of publishing nonsensical, inflammatory, misleading, and groundless complaints suddenly excited about the future of the iPhone? He’s not of course, he’s just stretching the truth to the breaking point again.

The real message is: be afraid, iPhone sales can not be impressive at any level because I’ll simply raise my expectations, and you shouldn’t consider the iPhone until Apple releases a $50 version that washes laundry and cures cancer, which I expect real soon now. While you’re waiting, check out Windows Mobile!

[Note: Mike Elgan responded to correct my characterization of his support for Windows Mobile in this article, noting:

You imply several times that I advocate Windows Mobile…. In fact, I write between 100 and 200 columns per year, countless blogs posts and other articles and never once have I praised or advocated Windows Mobile.

I will admit that Elgan’s announcing that the people should hold off on buying an iPhone only implies, but does not explicitly state, that he hopes readers will buy alternatives from the company he has professionally grandstanded for for years. If I overstated his support for Windows Mobile, I apologize and I am happy to cite his official position against Windows Mobile here in the article. ]

Best Quarter Ever Is Not Even Good.
Elgan blames the recent tumble in Apple’s shares, which began a week before Macworld and well before its quarterly earnings reports, directly on Apple’s sales reports, and in particular on the iPhone. Shares continued to decline due to a more conservative outlook than investors were expecting, but iPhone sales reports were stellar, certainly did not disappoint, and can not be blamed for a stock slide that began weeks before the figures were issued.

Elgan prefers to present this reality instead framed by his own invention, that “most analysts were expecting a number more like 5 million.” This is simply not true. A rumor site printed that number out of thin air, but analysts base their expectations on more substantial research, not guesses.

Consensus expectations from actual financial analysts, not blog writing “analyst” speculators, were 2.26 million for the quarter (Apple delivered 2.3 million for the quarter). As a professional writer, Elgan should know this, so is he intentionally presenting misinformation, or is he just an incompetent boob who skims rumor headlines to piece together his irresponsible, uninformed editorials?

Expectations Are Bad!
It appears Elgan knows he’s blowing smoke because his next line acknowledges that the iPhone was “easily the most successful cell phone launch in history.” That should mean something to a person who has professionally celebrated the dismal failure of Windows Mobile at every opportunity.

Yet In six months, Apple blew away Microsoft’s struggling efforts to push the Windows logo on phone users, accompanied by really bad phone software. This must be hard for a blind Microsoft cheerleader to see his way through as he flails his arms and puts on the best fake smile he can manage.

Even more bizarrely, Elgan then took Steve Jobs to task for projecting a goal of 10 million iPhones in 2008. In a bizarre circle of non sequiturs, Elgan says that the goal is irrelevant whether Apple makes it or not, but then complains that the goal has raised expectations too high and is responsible for the short term aberration in Apple’s stock price.

The two critically important factors Elgan fails to grasp, perhaps intentionally, are that:

First, nobody is seriously concerned that Apple won’t hit its 2008 target. Apple reiterated complete confidence that it will be able to make its goal, and most analysts are projecting the company will exceed it. Elgan is hoping voice doubt about it, but that’s because his core competency revolves around fear, uncertainty, and doubt for anything lacking the Microsoft logo.

Second, stock prices can and do go up and down dramatically in the short term for any company that is generating real change in the market. Apple isn’t a static company like Microsoft, which just lumbers along doing the same thing year over year. Apple’s dynamic growth attracts speculators who hope to make quick, short term profits, which results in a roller coaster ride for more conservative investors in for the long haul, but has little real impact on the overall direction of the stock.

We’ve seen Apple’s stock fall dramatically before without any rational basis; it did in the middle of last year on the cusp of the biggest product launch in consumer electronics. There is little reason to be concerned about Apple’s short term stock price fluctuations, and there is nothing executives can do or say that will prevent the cyclical profit taking that changes the stock price.

Stock isn’t a product Apple sells. The company’s executives have a job to create results, not sculpt stock prices on a weekly basis. Elgan’s remarks reflect either a gross ignorance of the market or a desperate need to paint a misleading portrayal of Apple in order to create panic and seed ideas that are not true.

 Wp-Content Uploads 2008 01 200801241818

The Unrealized Potential of Apple’s Hybrid Platform: Mac, iPod, iPhone, and TV

Will the iPhone Explode?
After insisting that there can’t possibly be demand outside the US for the hottest tech product of the year, Elgan brings up the “millions of iPhones in inventory” myth and questions why Apple executives expressed confidence in being able to meet their sales goals.

“Apple would need to sell 200% more iPhones than it already has in order to reach this goal,” Elgan fumes, apparently unaware that Apple has 200% of the time to do just that in 2008.

Apple sold 4 million phones in just six months and few days, almost entirely in the US. Might it be able to maintain that growth after adding in even larger foreign markets this year? The ten million goal that I described as wildly exuberant a year ago is actually looking quite conservative now.

The only way pundits can deny reality is to try to introduce short term fears based on panicked speculation, or to try to redefine that goal, as the Register UK did in an article where it outrageously claimed Apple’s goal was intended to be met by June.

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Tom Krazit of CNET and Eric Savitz of Barrons Deny the Jesus Phone

Don’t Buy the iPhone, Wait!
Predictably, Elgan presents the typical outlook Windows Enthusiasts give for non-Microsoft products: wait, the price will come down and new models will arrive with new features!

For Microsoft products, the advice is always buy now, don’t think about price, don’t think about new models, and pray for updates and fixes over the next year for a product that isn’t quite finished.

What’s the attraction with supporting a dinosaur in the throes of death? After writing enthusiast propaganda for so long, Elgan is completely blind to anything that doesn’t flatter Microsoft. Unfortunately, anyone who listens to Elgan and believes him will also be saddled with copycat junk from Microsoft.

Elgan insisted that the Zune would trample the market and “scare Apple to the core.” He insisted that Microsoft was “hatching an consumer media ‘perfect storm’” that “will leverage the collective power of Windows XP, Windows Vista, Soapbox (Microsoft’s new ‘YouTube killer’) and the Xbox 360.” Elgan also announced that the Zune “will capture mind share, grab market share and squeeze Apple on pricing,” which is laughable in retrospect, particularly since Apple’s pricing actually squeezed the Zune, and Microsoft was only able to begin selling off lingering inventory after dropping Zune prices into the toilet.

Elgan gushed over the Surface, a simple, rather unsophisticated product demo that the company was still unable to deliver as promised. He presented its announcement in June of 2007 as a challenge to Apple, which had already presented the far more impressive and commercially viable iPhone, and subsequently delivered it as planned.

Microsoft Surface: the Fine Clothes of a Naked Empire

Microsoft Surface: the Fine Clothes of a Naked Empire

Elgan also complained that “Apple is the New Microsoft”, apparently forgetting that he has professionally championed Microsoft throughout a decade of its monopolistic, anticompetitive behavior. Microsoft didn’t dominate the market by bringing out better products, but by buying up and killing better products, signing exclusive contracts that prevented competition, and falsely marketing promises it never planned to keep.

Is Apple a bad company for embarrassing the sloth and incompetence of rivals by releasing better products that consumers have chosen over a wide variety of competing models? Or is Elgan just being grossly hypocritical in falsely associating Apple with the conduct of a company he unreservedly supported through its most criminal period?

Ten Myths of Leopard: 10 Leopard is a Vista Knockoff!
Why Microsoft’s Copy-Killing Has Reached a Dead End

Elgan: Tear Down this Wall.
Sorry Elgan, but your credibility is falling apart. You can write all the happy sounding saccharine fawning you want about Apple, laced with bitter fears about how concerned and afraid you actually are about the company’s prospects, but it’s pretty clear that you’re not really reporting nor informing nor expressing a useful perspective on anything, but rather simply dishing out Microsoft’s talking points in a slice of cherry pie full of nails and screws and razor blades.

It’s too bad you’re so desperately embittered against Apple, a company breathing some interesting innovation into a tired industry. You should really lighten up and let go of your anger. Apple is not a company that has repressed better technologies for years, or systematically overcharged its customers to the point where state governments have sued it, or promised decades of catching up that it never bothered to do once it killed all the competition. Apple is not the new Microsoft.

I know it’s harder to analyze news when companies compete on actual merits on a level playing field, but it’s also a lot more fun to watch than a game consistently won by cheating. Maybe you don’t have what it takes to commentate on an unscripted sport where the best team actually wins. If that’s the case, why not step down from your Computerworld podium and do something you’re good at?

Arrogance Unleashed: The Foul Stench of Computerworld’s Mike Elgan

What do you think? I really like to hear from readers. Comment in the Forum or email me with your ideas.

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  • Jon T

    All good, undeniable stuff Dan, while Mike Elgan is a complete waste of space – when I see his name at the head of an article I never need to read any further.

    I’m in the UK, and tonight was at a dinner party of 8 people. Around the table, everyone who was there said their next computers were going to be Macs. One wife said hers would have been a Mac but for her husband who persuaded her to stay with Windows. Several kids at University had already switched to Macs.

    My son is at University in the UK and has managed his finances to enable himself to buy an iPhone (he already has a TiBook). The second iPhone in his shared house.

    All anecdotal evidence that Apple has got it just as right as Steve Jobs tells it, and it only needs time to demonstrate it.

    And for sure we’ll all forget that the little Mike Elgan’s of this world ever existed.

  • lmasanti

    “As a professional writer, Elgan ”

    As a professional writer, Elgan writes what the one who pays him wants to see written!!

    (See what it is written and you can conclude who pays him!)

  • MacProdigalSon

    In the old days, the tactic of laughing off competitors’ current products with promises of future superior MS solutions was such a common phenomenon that it had a label — vaporware. Not much has changed.

  • zaxzan

    He who fears something gives it power over him. ~Moorish Proverb

    It is very obvious that Mike Elgan is scared witless of Apple, they have become his nightmare, their success and popularity has become an incubus that feeds on his sordid soul … I just wish it would eat faster.

  • PerGrenerfors

    Have you seen this guy: http://jerryleecooper.com/

    What’s funny about this guy is that some “columnists” aren’t that far away from him in terms of intellectual strength.

  • nat

    One article after the next after the next! I know it’s not always possible to churn out story after story, but when the flood gates do open it’s rather impressive. Thanks for turning the lights on a number of non-issues made up by the usual suspects. These roaches are so big, they’re too slow to skitter into the disappearing shadows.

  • http://homepage.mac.com/johnnyapple johnnyapple

    “most analysts were expecting a number more like 5 million.” Hmmm, nope. I don’t recall seeing that number anywhere. My initial guess was 2.5 million, posted on 12/3 and revised down to 2.3 million on 12/27. I don’t claim to have access to anywhere near the amount of data the pros have and admit that my own guesses are influenced by what they write. My point is, I follow the numbers and analysts very closely and don’t remember any of them saying anything about 5 million. Elgan is full of crap. Perhaps he should keep a link handy of my quarterly guesses. I’m better at it than he is and outdo Scott Moritz’s whisper sources every time.

    My sources: Gene Munster, Shaw Wu, 10 years worth of previous sales data that I use to predict trends, some access to component costs. I didn’t grab opinions from a rather silly thread at macobserver. Walt Mossberg did in his blog. Oops, Walt, seriously?

    If I seem smug, sorry, really. I’ve lucked out the past few quarters and that’s fun for me. Stick with the pros if you’ve got real money on the line.

  • lmasanti

    January 25, 2008, 5:22 pm
    Apple: More On The Missing iPhones
    Posted by Eric Savitz

  • beanie

    Daniel Eran Dilger wrote:
    “Microsoft was only able to begin selling off lingering inventory after dropping Zune prices into the toilet.”

    Why do you keep repeating that exaggeration? The so called firesale for $80-$99 30GB Zunes was to start the holiday season, for one day and in limited numbers. It might have been also to clear existing ones with old firmware to replace them with 30GB Zunes with updated firmware.

    So how is Zune really doing in the marketplace. Surprisingly, the best selling Zune model is the Zune 80GB, not the small 4GB flash models. At Walmart Zune 80 is currently #2 selling mp3 player. At BestBuy it is #6. At CircuitCity it is #4. At Amazon it is #21 because it is out of stock this week, but has been consistently been in top 10 since its release.

    [Sorry, but it wasn’t a one day sale, it went on for months. I get affiliate links from advertisers who were pushing the fire sales, and it was very widespread, involving lots of merchants. Even as early as June 07, BestBuy, Amazon, CircuitCity, Staples, and Wal-Mart were selling it off for $199 or less. Woot held many one-day sales in August and September.

    As for more the Zune 80, if sales numbers had not been embarrassing, Microsoft would have reported them along with the Xbox figures (which themselves weren’t that flattering). According to NPD, this year “the portable media market declined on average by 16 percent compared to the same period a year earlier [2006]. The lone exception is the iPod line.” In other words, Apple grew while the Zune and other models did worse than last year.

    A key reason for tanking Zune sales was its competition with fire sale prices of last year’s model, as I predicted would happen. I’m not sure “predicted” is the right word; I don’t predict the rising of the sun every day. – Dan]

  • http://all.net/ hylas

    You’ve become the Keith Olbermann of IT.
    Nicely done.

    Think – outrage overload, I think people have become numb to thinking for themselves and basically turn off reasoning, or any critical thinking.

    This is your brain. This is your brain on Infomania.


    Attention Deficit Trait (ADT), learned by rote.
    Attention Deficit Disorder (ADD), congenital.

    The section entitled:

    Technological Reality – Cultural Paradigm

    … is case in point for the ever encroaching trend of the sloughing off of reason and common sense, not HAVING the time to consider, much less do more than react. The intellectual equivalent of “fight or flight”, essentially hammering you to a malleable stupor.

    Anyway, I enjoy your writing, the research must be quite time consuming – and I appreciate your attempts at having balanced opinions, you’ve been correct a lot of the time.
    It can’t be said you haven’t done the homework.

    YES, I’m new here.


  • surferfromuk

    Nothing remotely associated with Microsoft suprises me. I don’t even know why they get credit for anything since everything they do is a badly imitated copy of someone else’s groundbreaking work.
    History has demonstrated them to be a ruthless and wholly unethical company who, luckily for them, have had zero competition since 1985/6 when CEO Sculley kicked Steve Jobs out of his own company and then gave Microsoft use of ‘crown jewels’.
    Furthermore, it’ll get worse in the next two to three years as the mobster who runs Microsoft becomes increasingly desperate to maintain it’s self-imposed status-quo. Since they are unable to compete with Apple at any level when it comes to innovation or excellence they will truly start flashing their cash soon.
    How low they are capable of sinking is anybody’s guess.

  • beanie

    Dan wrote:
    “As for more the Zune 80, if sales numbers had not been embarrassing, Microsoft would have reported them along with the Xbox figures (which themselves weren’t that flattering). ”

    I suppose so. It is like Apple not reporting Apple TV unit sales and combining revenue with iPhone. Anyway, I told you how Zune 80 is currently doing in major retail stores. Zune 80 is selling relatively well for the last month. Don’t know if it will continue. Can’t help if you think or hope it is still a failure.

  • Robb

    I think you need to keep in mind that Daniel is also a pundit, it’s just that since he’s a Mac pundit he tends to speak for us most of the time.

    I don’t always agree with what Daniel writes, but it’s helpful to use to compare and contrast what other people are writing. The bottom line is to take in information from as many sources as available and draw your own conclusions.

  • harrywolf

    Its very funny to compare the ‘Surface’ to the iPhone.
    Isn’t the ‘Surface’ now known as the ‘BigAssTable’?

    A much more accurate description than ‘surface’ – its almost appealing in a slapstick way – if it were discounted to $99 like the Zune, it would sell, well, like a ‘BigAssTable’!

    Great graphic with Gates and Ballmer in the ‘table.

    Amazing when you think that people really put this Laurel and Hardy comedy object up as a useful thing.