The iPhone Shit Storm

Last modified on July 6th, 2008

Tonight I was pointed at a link, courtesy of John, that basically detailed a rumour that Apple is diverting iPhone shipments away from Canada next week. The reason for this, according to the rumour, is that Apple is not pleased with the grassroots backlash that Roger’s and the iPhone have received in Canada.

The thing is, it really doesn’t matter if the rumour is true (and in my mind, I doubt it is — it’s more likely in my mind that they have general manufacturing problems and can’t meet the demand) – either way, it’s a huge PR nightmare for Rogers. There was one site earlier that posted the rumor, and already I’ve found four or five that are regurgitating it, and adding their own spin on it. By tomorrow, that rumour will basically be fact, and will have propagated to Digg and all the other big tech sites.

As it stands, that petition at is well on it’s way to hitting 50,000 signatures by tomorrow. Based on the rate it was going at last week, that represents and increase in consumer momentum, not a decrease.

The question is, are all these people who are complaining still going to go out and buy an iPhone anyways on Friday? My gut tells me no. I think people are genuinely pissed off, and I think they are going to stick it to Rogers on Friday when the iPhone hits the shelves.

There’s really only one way to play this in my mind — Roger’s needs to cave before Friday. The negative press is just going to get worse before then, and I wouldn’t be surprised if this current rumour starts a whole new media storm against Rogers.

The first and obvious option for Rogers would be to quickly add an unlimited data plan to the mix. That would make most of the complainers (myself included) happy. And while the voice plans would still suck compared to the AT&T ones, I think most people would grudgingly go along with them.

The other option would be to reduce the contract length to two years instead of three. This actually might be the safer play for Rogers, since it wouldn’t require them backing down from their archaic data-plan rhetoric about how people don’t actually need unlimited. I think it would be enough to push some of the complainers back into the purchasing line.

If Rogers doesn’t cave, and the sales end up being dismal, I think it will be a huge blow against Rogers management and the public perception of the company. Before this, Rogers wasn’t very well liked in the wireless space. Now they aren’t very well-liked at all, both here and in the United States, thanks primarily to the extensive coverage this incident has gotten. That’s why I think it’s important that Rogers admit defeat, apologize for the misstep they took, and offer a better plan before Friday. If they do that, it’s basically a win-win. Sure, they’ll look a bit stupid, but far better than to continue down the path they are on and force a lose-lose.