Commentary on the Steve Jobs rumor mill

The Macworld keynote is tomorrow morning and as everyone knows by now, it will be without Steve Jobs. Tomorrow the world will learn that Apple CAN announce exciting new products without Steve giving the presentation. It might not be AS exciting as hearing it from Steve, but the stock can and will go up when exciting things are announced. Overall this is a good thing for Apple, stockholders, and the Apple community. Apple needed to make this change – my reasons follow…  UPDATED…

First off, I feel bad for SJ and for his family that his health has become a public spectacle. On one hand it is a private matter and should be no one’s business. However, on the other hand it unfortunately comes with the territory of being a public figure. It’s just like Travota is surely suffering at the loss of a child and the last thing they need is to see themselves plastered all over the media. But it is part of being a celebrity.

But with Jobs it is a little different. There is a strong perception that his involvement very much effects the business. And it certainly does effect the stock price. Both Steve Jobs and Apple needed to change this tie. And I believe that this recent move is a conscious step to do that. Look at these events:

Dec 16 - Apple announces no Steve at Macworld, last macworld – Stock drops 6 points from 95.43 down to 89.16

Dec 30 – 11:08 AM – Worried about Steve’s health, Kevin Rose, owner of Digg, sells his Apple stock.

Dec 30 – 12:15 AM - Gizmodo.com quotes an anonymous tipster who claims the Macworld cancellation is because of Steve’s “rapidly declining health”. Is quoted as saying “no Steve means no hype.” – Stock dropped about 1 point over the next 2 days but mid-day the stock dropped from 87.33 moments before the blog post, down to 85.89 right after the post.

Jan 1-2 – After reports of new product rumors the stock rallies back up to 90.75

Jan 5 – Steve Jobs posts an open letter sort-of explaining his weight loss – The stock hits a mid-day high of 96.18 and closes at 94.58.

Jan 6 – If Phil Shiller announces anything even slightly exciting the stock will rise even further. This is the smartest move Apple can make right now. Proving that Apple can be exciting with or without Steve is a strategic move to take control back.

A couple of things.  First, I find it interesting that Kevin Rose and Gizmodo had enough power and influence to make the stock move 2 points. You have to wonder if it was done on purpose to make a quick buck. Did anyone at Gizmodo say “Wait! Give me a minute to sell my stock before you publish that story”?  Or did Kevin Rose know about the pending story before he sold his stock? Or worse, was it all done with the intention of manipulating the stock? Of course I’m not making an accusation. Surely the SEC would investigate it if they felt it was shady. The trick would be to know if he bought it all back when it hit the bottom that day.

The fact is that almost a quarter of a million people read the Gizmodo story, not to mention how many people read Kevin’s twitter, or heard of it indirectly or read it on another site that quoted Gizmodo. And those stories directly influenced the stock price by around 2 percent. Whether or not Gizmodo is a news agency or just a bunch of guys writing a blog about technology, their word is taken seriously – even when they preface it with the word “rumor”.

The second thing I want to say is that I disagree with the tipster who said “no Steve means no hype.”  The truth is that no new good products means no hype. And recently Apple has been a little short on cool new products. Once you come out with the iPhone where do you go from there? For my taste, if Apple could put together a slick tablet mac with full Leopard, a touch screen, bluetooth mouse and keyboards, and built in 3G – they’d have another iPhone on their hands.

Next is that there are many other reasons to stop doing Macworld. Just like they stopped doing NAB a year earlier. These days Gizmodo and Engadget do a great job of covering new technology and gadgets all year round. Companies don’t need to wait for an annual electronics show to release products.

Last is that it’s getting more and more impossible to keep secrets. Steve or no Steve, there haven’t been any surprises lately. It really has nothing to do with Steve’s health. I think this new Apple-at-macworld-less world could be a better one.

I for one hope that Apple announces some good things in the morning that people get excited, and that the market responds with a rally in the stock. Hopefully they can put an end to the connection between Steve Job’s health, these trade shows, and their stock price, and get back to innovating exciting new products.

UPDATE: Jan 7, 2009

Apple DID NOT release anything new and exciting and the market responded with a drop from around $96 early in the day yesterday (before Phil’s keynote) to down around $90 today.  I think the drop is stock is not due to Phil giving the presentation but more likely is because they didn’t release any thing new or exciting. A new iLife and iWork and a new 17″ Mac Book that everyone knew was coming isn’t good enough. I still feel that they made the right decision. Had Steve given the presentation it wouldn’t have made things any better. There wasn’t anything new to report. And this is why they need to get away from this model of releasing products surrounding these kinds of events.

While my hopeful prediction that the stock would rebound quickly didn’t come to fruition, I stand by the rest of my analysis. In the long run this is where Apple needs to go.