I don’t envy Tim Cook right now. His Chinese supply chain, the one-time envy off the tech world and backbone of Apple’s amazing growth over the last 15 years, is still moving slowly as SE Asia recovers from COVID-19’s initial round of effects. However, even as things gradually return to some kind of normalcy on the other side of the world, the pace of production will be slowed for months to come. Now Apple also has the potential impact of this new threat here at home to deal with, as well.
First off on the list of potential hangover effects comes from a new Digitimes report. According to them, it is possible that Apple may have to defer the launch of the iPhone 9/SE 2 to the second quarter of this year. Digitimes said that Apple’s new device has reached the verification stage, which means that it is pretty much ready to go for what was rumored to be a March/April launch. However, it seems that component shortages due to COVID-19 may have thrown a wrench in Apple’s plans. Maybe Digitimes is wrong, but this definitely seems plausible considering how long many plants have been shut down or slowed. If the iPhone 9 is delayed, it will definitely be a blow to Apple’s numbers, at least for the current quarter.
Speaking of the iPhone 9, it was likely to be announced at a rumored Apple event. However, based on the cancellation of other recent and future Silicon Valley events, there is a strong possibility that a media launch event late this month won’t happen. Add to this the fact that Santa Clara County, home to Apple and several other tech giants, has issued guidance for companies that include limiting events and work travel. If nothing else, I don’t think Apple goes against these recommendations.
Apple not holding an event wouldn’t be the end of the world, as they have launched secondary products via press releases on several occasions. However, Apple cancelling a launch event when they would prefer to hold one would be new territory indeed. More evidence of the wide reach of COVID-19, or at least the fear of it.
Then there is the matter of WWDC. It potentially being cancelled is a MUCH bigger deal and would also be a bigger blow to Apple. While they are now at the point of streaming and recording all of the labs and educational content, it is hard to replace the experience of being able to spend time going hands-on with the same Apple engineers who develop the software and features. That would definitely be a loss for those deverlopers who are planning to go.
The bigger blow to Apple would be the loss the media presence at the opening keynote. That is one of Apple’s two biggest events of the year, along with the yearly iPhone launch event. Having it diminished by being streaming only with little to no audience and with the tech media and press not being able to go hands on or ask questions directly would be yet another tough break for Apple. Then there is also the energizing effect of the camaraderie of the event for developers that would be lost. Losing all of the public aspects of WWDC would be the biggest setback of all.
That said, I don’t see how Apple can go forward with WWDC after Google, Facebook and others have cancelled similar public events. Unless COVID-19 ends up much less severe than currently anticipated, Apple would be at risk of a major public backlash for carelessness if they tried to go forward when their contemporaries didn’t.
I’m not sure Apple will be delaying an iPhone based on one Digitimes report, as they have an up and down track record. However, if I were a betting man, I would put my money on Apple cancelling a potential March event and making WWDC streaming-only. It’s just too risky for them to do otherwise, even if COVID-19 ends up being not much more fuss than the flu. The potential negative PR blowback would be worse than any losses based on device delays or event alterations. And at the end of the day, even if COVID-19 doesn’t become a pandemic, caution is the right approach for Apple and the rest of Silicon Valley.