Daring Fireball on Think Secret

Posted on March 9, 2005 by Ian Betteridge

John Gruber (one of the best Mac-related commentators on the web) takes a look at the Think Secret case in Daring Fireball: If The New York Times Jumped Off a Bridge.

Contrary to Think Secret’s statement-as-fact that Apple never would have even “considered” filing suit against The New York Times, I think in fact the opposite is true. If The New York Times, or any other deep-pocketed mainstream publication, had published the same information, obtained in the same way, Apple might have been more likely to file suit than they were against Think Secret.

Sorry John, but this simply isn’t true. In ten years of being a reporter, I’ve covered lots of stories which included so-called "trade secrets", and not once in that time have I been sued (and only once did a company even threaten it). The reason was simple – I worked for companies that had deep pockets, and good legal teams. John’s old enough to remember back to the era of MacWEEK, which covered Apple in exactly the same way and, despite occasionally frosty relations with Apple, never ended up in court.

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  • Javier

    Comparing MacWeek to Think Secret ignores one fact – Steve Jobs is CEO now. Other Apple CEOs weren’t as secretive. Back in the Pepsi days, Apple me-tooed Microsoft, announcing vaporware (Rhapsody), and releasing half-baked products (CyberDog).

  • http://technovia.typepad.com Ian Betteridge

    Back in the Pepsi era, the company also grew from a $1 billion company to a $10 billion one – Jobs, for all his showmanship, has yet to show anything like that growth.

  • alex

    How far does your newspaper cross the line without the editor reining in, or is it full license to the reporter to expose these trade secrets? Just curious.

    Frequently, a well edited article skirts the legal issues and as you said the editor does have access to legal teams if in doubt.

    There might be a difference these days with Steve Jobs driving Apple, where the timing of a new product is deemed crucial to its success, but I think a measure of horse trading for exclusive coverage would be Apple’s method for trading with deep pocketed press organizations rather than lawsuits. Besides being more professional, a well documented article with quotes does seem to improve the stature and relevance of the publication as compared to reporting on rumours.

    The past quiescent behaviour of companies whose trade secrets were violated is not a gurantee that things will always be so. We can only hope that the pendulum does not swing such that the freedom of the press is completely curtailed.

  • John

    When Jobs returned, Apple was a $7B company that was facing another year of shrinking to a $6B company.

    Last FY, Apple was almost a $10B company and is going to be at least a $12B company for FY05, with some analysts projecting it as a $13.5B FY05 company.

    So Jobs has done as much as anyone else before him!

  • http://technovia.typepad.com Ian Betteridge

    Ummm, John, adding a third (or even a half if your predictions are right) to the company’s revenues isn’t the same as increasing the company’s size by ten times.

  • John

    Newsweek or Time do not clearly publish trade secrets, but rather work out agreements with Apple for first-day ‘scoop’ publication that is to the benefit of both Apple and the publication.

  • http://technovia.typepad.com Ian Betteridge

    Of course, and I’ve worked on magazines that did that too. However, that doesn’t in any way mean that Think Secret isn’t journalistic: it simply means it’s a different kind of journalism.

  • http://daringfireball.net/ John Gruber

    MacWEEK, in the form of its back-page Mac the Knife column, definitely published equivalent stuff to what Think Secret does. And Mac the Knife was much better-written, and generally more accurate, but that’s neither here nor there.

    The difference, as pointed out by Javier above, is that Steve Jobs wasn’t in charge of Apple at that time. Apple leaked like a sieve in that era.

    Get ZDNet to publish something like that now, and see what happens.

  • John

    But when they left, it was just a $6B company. Even so, on a percentage basis, you’re right. But on an absolute basis, Jobs adding $6B to $7.5B is still more than adding $5B. Of course, the Jobs reign hasn’t concluded yet, so there is still the rest of the story.

    And you’d have to agree that the base for the $1 to $10 to $6B rise and fall, namely the Apple II and Mac/MacOS, was there before Sculley and others entered, milked it, and left it shriveling – having been pummeled by Win95 and Mac clones. Jobs was given MacOS8 and Pink/Taligent/Rhapsody, and had to bring the future: the foundation of OS X (altho Apple did pay for it.)

  • http://technovia.typepad.com Ian Betteridge

    John, I’m certainly not saying that Jobs has done a bad job – far from it. But I get touchy at the all-too-frequent criticism of Sculley, who actually did a pretty good job (at least until he tried to retire and was persuaded by the board to do otherwise). The post-Sculley era… well Spindler was a disaster, and Amelio was probably out of his depth.

    John G – Good to see you, welcome! In fact, other sites have written a lot of that kind of coverage about Apple during the Jobs era, including ZDNet and CNet. The Financial Times, AP, Reuters and others all reported about the iTunes Music Store prior to its release, reports which weren’t based on rumblings on rumour sites. ZDNet reported last July on an unannounced feature of Tiger which will aid migration from Windows NT, as well as on 10.3.3 prior to its release. CNet reported last year on new Power Macs well before their release. And there are many other examples – in fact, the fact that “mainstream” publications cover Apple in the same way forms part of Think Secret’s defence.

  • http://www.electric-escape.net/ Robert Jung

    “Ummm, John, adding a third (or even a half if your predictions are right) to the company’s revenues isn’t the same as increasing the company’s size by ten times.”

    What about adjustments for inflation? And to be fair, I think Jobs should get some credit for increasing public mindshare about Apple — nothing Scully ever did has gotten “the rest of us” all abuzz as the iMac, iPod, and Mac Mini have.

    As for the whole Think Secret etc. bruhaha, I can’t say I have too much sympathy with the bloggers here. Someone somewhere violated an NDA or three, and should be prosecuted for that. But receiving (and publishing) the fruits of said violation isn’t a victimless crime, either — after all, we’ve got laws against receiving stolen goods, too. And if Think Secret was actively soliciting folks to violate their NDAs, that’s aiding and abetting.

    Now, granted, corporate trade secrets aren’t the same as national security documents (and if you think Apple is being draconian, I’ll just say you ain’t seen nothing yet ;-) , but to simply dismiss the entire issue by saying “freedom of the press” is a bit disingenious IMO — there has to be some responsibility involved…

    –R.J.

  • KenC

    Daring Fireball has changed its opinion today.

  • JasonM

    Deflation hasn’t been a big factor (has it even occurred?) in the US economy in the past decade, so Sculley’s achievements are even more impressive.

  • JasonM

    Personally, I think Daring Fireball’s assertion that

    “The Times doesn’t print unsubstantiated or dubiously-sourced gossipy conjecture on unannounced or unreleased products.” is a load of … :

    http://www.russianlaw.org/nytimes-main.htm

    So, I can’t get behind the rest of his argument.

  • JasonM
  • Roger

    I’m sorry. I don’t consider publishing rumours with abandon as being journalistic. At least not responsibly so.

    Being a good (proper) journalist means publishing news objectively in a responsible way with integrity. That means, for any given story (news item), investigating the story fully, collecting facts that can be backed up by credible sources, and then taking a RESPONSIBLE approach to writing the article.

    Being responsibe means taking into careful consideration the consequences of actions. Sometimes, editors decide to limit or not to pubish certain stories for fear of their consequences and effects on the parties involved.

    Think Secret did not do that. It published secret information without regard to possible damage to Apple’s business as a result of making that information available to Apple’s competitors ahead of time, possibly allowing them to come up with a competing product at the same time frame or earlier than Apple planned to release their product. Something like that can cost a company millions in lost sales and no way to recoup their R&D costs. Something like that can eventually drive a company out of business. And that’s irresponsible.

  • http://technovia.typepad.com Ian Betteridge

    Roger, please point out to me what information that Think Secret published in its report on the Mac mini that a competitor would find useful, and which could, therefore, cause the company economic damage? Could Dell (et al) really have produced a similar product before Apple? No other computer maker has come up with anything yet which even matches the Cube (nearly five years after its launch) – I doubt the few days extra notice they got of the Mac mini made any difference. Do you seriously think that a report as vague as Think Secret’s could “drive a company out of business”?

  • Roger

    Huh? The Think Secret lawsuit isn’t about the Mac mini. It’s about finding out who leaked the information about the “Asteroid” project, which is apparently still a ways off from being ready for market.

    Several companies could come out with a product similar to that given sufficient time/notice, especially if they already have some sort of existing product that they can modify it from. Dell would not be the competitor there, but possibly someone like MOTU, etc.

    And the comment about driving a companyy out of business was a generalized comment meant to make a point if such a thing was allowed to continue to happen, that could the an end result. If every time a company was working on a new product, sufficient details of it leaked out, they could harldy be competitive now, could they? And if their competitors managed to get the scoop on them and effectively reduce the amount of lead time the company had on the market with their new product, well that company certainly wouldn’t make as much profit as they could, which might eventually lead to dwindling returns. And as you know, companies are veru sensitive to that sort of thing in today’s marketplace.

  • Roger

    I meant to say “isn’t just about the mac mini.” sorry.

  • Roger
  • http://technovia.typepad.com Ian Betteridge

    Roger, there are two cases involving Think Secret. In the first, Apple is attempting to subpoena Think Secret, AppleInsider, and PowerPage for information about sources for stories about Asteroid. It is NOT accusing any of those sites of violating its trade secrets rights, and – as Think Secret publisher Nick Ciarelli has already said in a sworn deposition, Think Secret did “no original reporting” on Asteroid. Once again, Apple is NOT attempting to bring a case against any of these sites: it is instead seeking a subpoena to bring a case against whoever leaked the details originally, (presumably) breaking an NDA in the process.

    In the second – and equally important – case, Apple is accusing Think Secret (alone) of violating its rights under UTSA. This is a completely seperate case and has nothing to do with Asteroid: instead, it deals with iSync 1.1, iWork, and the Mac mini.

    Incidentally, this kind of reporting has been the staple of trade press since the beginning of the computer industry, and as far as I’m aware no company has been driven out of business because it it.

  • Joel

    Seems to me that the difference between MacWeek and TS is that Jobs is in charge now.

    Also, I think the difference between TS and the NYT is that the latter *will* reflect these rumors in print at times, and the former introduces many if not most of them. In that sense, the NY Times is reporting on the rumors, not leaking the info itself.

    Rumors can and do hurt Apple when us Mac users and the so-called analysts accept them as true or even hopeful. How many times have we seen people get excited for an announcement (the “rumors are good” argument) but end up disappointed by the actuality of the announcements? In the long term, I’m not sure how much financial impact these rumors have, but the stock usually takes a dip on announcements historically, and the hype for a $250 iPod mini is probably muted a bit when people expect a $199 one, as an example.

    I’m not sure to what extent Apple can afford to decide how *much* of an impact a leak makes. I imagine they treat a preventable leak (as opposed to “premature specification” and Time Canada cover articles) the same way no matter if it comes 1 minute before the announcement or 1 year before. How would a company define what’s passable in these terms? What would be the consequences of this grace period? Can trade secrets be enforced at all if any such policy were adopted? I assume it’s like trademark protection. Use it or lose it.

    I wonder if the reason this is happening now as opposed to a year ago is because of the plaintiff’s age.

    I’m not even going to start about the ethics of all of this except to say that I would have hoped someone asked themselves “should I?” instead of just “can I?”