The New Yorker once published an essay with a theory about the real genius of Steve Jobs being he was a "tweaker," but perhaps his real genius was to get everyone (especially many "progressives" and the media) to ignore what is increasingly becoming an Achilles heel for Apple (NASDAQ:AAPL) - the use or alleged "abuse" of "underpaid" Chinese labor at its Taiwanese subcontractor Foxconn (OTC:FXCOF) along with gentlemen's agreements not to poach employees from other Silicon Valley tech firms (to keep engineering salaries low). However and as an American company, Apple is increasingly being forced to take action against both real and imagined labor problems in China to avoid the PR nightmares faced by Nike (NYSE:NKE) some years ago. These actions will not only harm Apple's margins and bottom line, they will also give Samsung (OTC:SSNLF), a company that is not facing the same level of scrutiny or concern because its Korean, a big and growing competitive advantage for the long-term.
Likewise, the growing volume of emails written by Steve Jobs that are being released as part of a lawsuit targeting several tech firms over do not hire gentlemen's agreements further threatens to tarnish his legacy, the image of Apple and cost hundreds of millions of dollars in legal claims. Those emails also make one wonder what other emails may lurk regarding labor conditions in the Chinese factories of Foxconn and other iPhone or iPad suppliers.
Apple Products: Just Betamax Made in Chinese Sweatshops?
To begin, let me explain where my point of view about Apple comes from. When I left the United States about a decade ago to live and work in Asia, Apple was, well, the computer company that gave my elementary...
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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.