Think Belligerent Steve Jobs will do anything to protect his precious secrets. So he's suing Apple's biggest fans. Inside the Mac daddy's battle with the rumor blogs. By Tom McNichol
Nick Ciarelli is the kind of guy Apple is supposed to love. At age 6, he began using his parents' Mac Classic and quickly became a zealot. At 13, he launched a Web site devoted to all things Apple, especially upcoming product releases. Now 19, Ciarelli has turned the site, Think Secret, into a must-read for true Apple fans. Few suspect that the person writing so authoritatively under the name Nick dePlume wasn't even born when the Macintosh was introduced. Young, a bit brash, and not afraid to think different, Ciarelli has become a personification of Apple itself.
So why is the company trying to squash him? In the weeks leading up to this year's Macworld Expo in San Francisco, Think Secret published a string of exclusives about forthcoming Apple products. Ciarelli predicted the debut of the Mac mini, a sub-$500 headless iMac. He also anticipated the launch of the iPod shuffle and of iLife '05 with GarageBand 2. Think Secret was, it turns out, right about all three. Apple, led by hyper-controlling chief executive Steve Jobs, congratulated Ciarelli by faxing him a 19-page lawsuit, Apple Computer Inc. v. Nick dePlume. The suit alleges that Ciarelli violated the Uniform Trade Secrets Act by soliciting information from sources inside Apple and posting it on his site. Apple demanded that Ciarelli pay damages and hand over his profits.
The company has also hit Think Secret and two other enthusiast sites, PowerPage.org and AppleInsider, with a separate suit, filed to obtain the identities of the people who were leaking product information. In March, a California Superior Court judge ruled that the sites had no right to protect their sources or withhold unpublished material. The Electronic Frontier Foundation has stepped in to appeal the ruling, arguing that online journalists have the same right to protect sources as traditional journalists do.
Until the suits were filed, Apple seemed to be enjoying a symbiotic relationship with Ciarelli and his peers. The obsessed fans would dole out any scrap of inside dope they could gather, and Apple, in turn, would benefit from the intrigue and publicity generated. But the lawsuits sent a clear message: Apple wanted out. "I still love Apple products," says Ciarelli, now a freshman at Harvard, where he runs Think Secret out of his dorm. "That hasn't changed. But obviously, I wish I weren't involved in a lawsuit. The techniques I use to gather information are legal. This wouldn't be happening to The New York Times."
That's because the Times, along with other major news organizations, is unlikely to be intimidated by Apple's muscle - and Jobs knows that he needs the mainstream media to wage his remarkably effective publicity campaigns. In fact, Apple's crackdown on three obscure enthusiast sites may well have less to do with protecting trade secrets and more to do with creating buzz.
Viewed in that light, the lawsuits have already been a success. Apple filed against Ciarelli on January 4, seven days before the products he wrote about were formally announced. It was a tacit admission that Think Secret's information was largely accurate - and it triggered coverage not only of the forthcoming Mac mini and the iPod shuffle but also of Jobs' keynote. Two months later, news about the lawsuit was still showing up on the front page of the Times and The Wall Street Journal. "Usually, a rumor like this is good news for a company because you get the story twice," says Gary Fine, a sociology professor at Northwestern University and coauthor of Rumor and Gossip: The Social Psychology of Hearsay. "You get the rumor about the new product, and then you get the official announcement. But in this case, maybe Apple wanted to get the story three times: the rumor, the lawsuit, and then the announcement."
Even if publicity was the real motivation behind Apple's legal maneuvers, the company is not, of course, owning up to it. Apple won't comment on the lawsuits at all, except in a statement asserting that the defendants "stole our trade secrets and posted detailed information about an unannounced Apple product on the Internet. The protection of our trade secrets is crucial to our success."
It's true that any company in a cutthroat business needs to keep a tight lid on product rollout schedules. But Think Secret's scoop about the Mac mini gave rivals a mere week's notice - hardly time to gin up a press release, much less a competing product. What's more, the news wasn't exactly shocking. "We have tons of examples of people speculating about a headless Mac as far back as 2003," says Terry Gross, a San Francisco attorney who's representing Ciarelli. "So I'm not sure how they can say that's a trade secret. This lawsuit is really about intimidation."
That's a word that has become synonymous with Apple, where the urge to clamp down on information sometimes borders on paranoia. Employees must sign nondisclosure agreements; job interviewees aren't allowed to visit the rest room unaccompanied lest they get a glimpse of something unauthorized. In January, when bloggers from an enthusiast site stood outside San Francisco's Moscone Center and photographed Life Is Random posters 48 hours before the phrase was to become the iPod shuffle's ubiquitous tagline, an Apple crew rushed outside and forced them to delete their photos.
This control-freak impulse comes straight from the top. Chief executives of major companies have just so much time for the media, no matter how much they value the power of publicity. But Jobs is unique in the way he manages external communications. He rarely grants interviews or sits for photographs. When he does talk, all discussion leads back to the product he's promoting. And when he grants a photo shoot, it's with the Apple product in hand.
Ever since Jobs returned to Apple in 1997, the company has used the threat of lawsuits to try to stop magazines like MacWeek from publishing tip sheets and product speculation columns. If the control fetish has reached new heights with a war on the company's biggest fans, that's because, from Apple's viewpoint, there is no other option. Computer trade glossies are always weighing the benefits of printing inside information against the threat of losing access to Apple or its ads. "We don't do rumors," says Macworld editor in chief Jason Snell. "There's a benefit to having a good relationship with Apple; they're more open to media outlets that play ball." But the enthusiast sites don't get interviews with company officials or Apple advertising revenue, so they have few disincentives to publish speculation. As a result, Apple has turned to its last resort - the courts.
There's a risk, of course, in taking a swipe at the Apple zealots. "I've done nothing but create community for Apple, and this is what I get," laments Jason O'Grady, who has run PowerPage.org since 1995. "The shine has come off Apple for me."
Running a tightly controlled company has worked well for Jobs. But being a little out of control can pay dividends, too - by fostering creative freedom, not to mention goodwill. Jobs need only look at his own slogans. Life Is Random. Enjoy Uncertainty. At Apple, this is marketing, not a way of life.
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