Apple Watch 'collapsing sales' report actually shows Apple is crushing smartwatch sector

Widely publicized study data reported by clickbait sites as evidence that Apple Watch sales have "plunged" and "are tanking" actually shows something completely different: that Apple has launched the most successful smartwatch product by a vast margin.

Apple hasn't yet given any figures on Apple Watch sales (after noting last year that it would not be publishing unit sales of the new device in its quarterly earnings reports), but Slice Intelligence compiled some questionable figures from "e-receipt" data it gleaned from a large group of consumers who volunteer to share their purchasing information.
Slice obtains much of its consumer data from an shopping assistance iOS app (which includes support for Apple Watch).
The Slice app allows users to track their online orders, visualize their own spending habits and even get alerts when prices change, assisting users to ask for refunds. The apps has garnered enthusiastic reviews, with the prospect of obtaining refunds on previous purchases being a particularly popular feature.

There's no way to precisely fact-check how accurate Slice figures are, but we do know that Apple Watch is an entirely new product that has gone on sale in very unique circumstances.
Professional financial analysts trying to track sales of more mature and better understood market segments, such as Macs and iPhones, are routinely off by millions of units despite the much easier task of counting conventional channel sales of PCs and phones, most of which are sold by third party retailers.
The first three months of Apple Watch sales were almost entirely sold online, direct from Apple's website. Slice's own data on FitBit wearables indicates that the majority of its sales data was gleaned from Amazon, Best Buy, Target and other third party retailers, none of whom are selling Apple Watch.

[Clarification: a representative from Slice Intelligence detailed to AppleInsider that the company's data for Apple Watch, FitBit and other wearables in the report only includes online sales tracked through the firm's app, email-scanning and partner services; the report also examined FitBit's retail sales channels because unlike Jawbone, Samsung and other wearable vendors, FitBit sells a large percentage of its products through its own online site. This parallel analysis was done to avoid over-represenenting FitBit market share in online sales. While Slice does include online sales from Amazon and other retailers, it did not include in store sales in this report.]
Given that most Slice volunteer data streams from discount online sales and big box retail, there may be poor representation of the very different demographic of buyers who are early adopters of Apple's new, much more expensive, sophisticated and personal product, a device that's closer being high-end jewelry than a conventional tech gadget. [Slice maintains that it does not under-represent sales of Apple products, noting that online U.S. shoppers are more likely to be more informed and affluent than other retail store buyers.]

The Slice data being cited is also U.S. only. We know that international sales, particularly in China, have for some time represented the majority of Apple's sales overall, so the Slice data can only possibly represent a portion of total Apple Watch sales.

[Slice reaffirmed that the figures it presented were U.S. only and limited to purchases made online. The firm also noted that it excluded sales data from Ebay, noting that it sought to eliminate secondary sales from its data. Given the constrained supplies of Apple Watch over the entire quarter, it is possible that significant volumes that were sold early at launch were bought by speculators and resold later, contributing to the steep decline of first party sales that Slice observed.

Additionally, Slice itself reported in mid May that only 48 percent of Apple Watch orders had been delivered, indicating that its steep drop in sales reflected orders, not sales where buyers had taken possession of their new Apple Watch. This directly contradicts the idea that demand for Apple Watch has collapsed, as the data Slice published is not a measure of supply reaching demand, but rather of an initial demand peak that supplies have only recently grown to meet.]

We also know that Apple product categories have different cyclical patterns in specific regions (iPads are rapidly growing in China, but appear to have plateaued in the U.S., for example) and that holiday sales peak in the West during Christmas and surge in China during the Lunar New Year.

Apple Watch wasn't available during either holiday season, and sales have remained strictly constrained by short supplies, a well established reality that doesn't seem to fit into the Slice data as reported at all.

Slice blazing a new data trail with daily sales estimates

Slice data appears to show (below) that Apple Watch sales have incrementally declined since launch along a falling trend line of daily sales. We don't know how this data might compare with daily iPhone or iPod sales (which are known to surge at launch and then fall off at different rates as time goes on), but we do know that product cycles have shifted dramatically as product categories mature.

We also know that estimating sales is extremely difficult, even after product categories mature. The consensus analyst estimate for the last entire quarter of iPhones was off by 6 million units, or more than 10 percent.

A week before Apple announced sales of 61 million iPhones in April, Pacific Crest's Andy Hargreaves revised his iPhone guess upward to 58.1 million from a previous 56.8 million. He was still off by nearly 3 million. That's more than a week's worth of iPhones. Imagine the worthless data he could generate if he'd been trying to estimate daily sales, the way Slice has.

However, even if you ignore the potential problems with Slice data and simply take it as reported, it actually shows something far different than what was reported by virtually every tech news site today.

Apple Watch crushed sales of far less expensive smart bands

In a rather desperate bid to establish some aspect of failure for Apple Watch, journalists appear to have completely overlooked the majority of the data Slice actually presented. Even if the Slice data is only moderately reliable, it clearly shows that Apple's first attempt to sell a "smart band" has trounced everything else on the market, and continues to far outsell everything else even after supposedly "collapsing."

This reality was not readily apparent in the data Slice presented, which primarily compared Apple Watch sales (at $350 to $1,000 and up) against FitBit fitness trackers, a family of products that range from $60 to $250. Amazon indicates that its top FitBit product is a discounted model that it sells for $90.

Unlike Apple Watch, which has one set of features whether users opt for the $350 Sport, the $500-$100 stainless steel, or the $10,000 and up solid gold Edition, most FitBit models are a basic watch with a step counter; only two models (at $150 and $250) add a heart rate monitor, and the more expensive one includes features like text notifications and music playback control. Comparing low cost FitBit activity trackers to Apple Watch is like comparing $50 to $250 iPods to high end smartphones.

Slice details its sales data down the week or even day, but bundles together all FitBit models to compare against Apple Watch, reminiscent of the tactic IDC used to denigrate iPad sales in comparison with huge volumes of cheap tablets including "kids toys."

The firm emphasized in a report subheading that "Apple Watch Launch Did Not Take a Bite from Fitbit Sales," and pointed out that in May, "850,000 Fitbit devices sold versus 777,000 Apple Watches," as if Apple's launch was intended to instantly obliterate the market for anything else one might wear, and had therefore failed.

Of particular interest is the fact that Slice's tweeted chart (above) didn't include first day sales. Adding in that surge of launch day orders, the chart looks very different: the respectable volumes of popular FitBit devices are crushed down into the x axis.

Only five times has FitBit sales (according to Slice data) ever reached above 200,000 sales per week, and across 2014 the company's sales only reached above 100,000 sales per week during the Christmas holiday season. However, in its launch week Apple Watch U.S. sales opened at over 1,300,000 units (according to Slice): essentially a year's worth of FitBit sales in one week.

FitBit is a successful company that investors expect to be worth billions. Despite being hard to buy over its launch quarter, Apple Watch immediately achieved a large installed base starting at a price point much higher than the most expensive FitBit; it is clearly appealing to a very different customer.

If you clear away the distraction of cheap FitBit fitness trackers and look at actual smartwatch competitors to Apple Watch, you'll see even in Slice data that Samsung — the primary smartwatch vendor, with several models that are all cheaper than Apple Watch and years of experience in trying to sell them — is barely a blip on the sales chart.

Even the supposed June "collapse" of U.S. Apple Watch sales as reported by Slice (which itself never referred to as a "collapse") remains at a rate far higher than Samsung Gear products achieved even over the last holiday season. In fact, every other smartwatch vendor has seen their already anemic sales actually collapse, without ever having achieved a strong launch to start with.

Apple's iPods, iPhone and even iPad didn't hit their sales stride in the first three months of sales. Each took some time to build an audience of millions, and saw sales develop particularly during holiday seasons.

Pulling it out of the analysts

Many news sites covering the Slice data (including, of course, BusinessInsider) also made reference to Pacific Crest's Hargreaves, suggesting that his recent note harmonized with the idea of "tanking" or "collapsing" Apple Watch sales.

Hargreaves' note stated that "store visits, Google search volume, third-party data and recent supply checks all suggest demand for Apple Watch has fallen sharply from initial levels."

Citations of his note in conjunction with Slice data didn't also point out Hargreaves' past record of accuracy in forecasting, or the inherent problems with relying upon "supply checks," or conducting "store visits" related to a product that hasn't even been available in retail stores throughout most of its launch quarter, outside of a select few fashion boutiques worldwide.

Additionally, his pessimistic "Google sales volume" comment was based on the fact that more people search PCs about "iPod" than "Apple Watch," as if it doesn't matter that over 400 million iPods have been sold over the past 15 years, while Apple Watch has only been on sale for three months.

Even so, Hargreaves himself also estimated the next quarter of Apple Watch sales to "meet or exceed" 5.5 million internationally, accounting for fiscal year sales (launch through September) of 10.5 million units. Those figures are too large to even fit on the Slice chart, and directly contradict the idea that Apple Watch sales are collapsing into obscurity, rather than supporting the notion.

China Labor Watch has been shown to have faked videos of FoxConn, using videos taken at other companies, claiming they were at FoxConn. They have been shown to have shown to have faked interviews with supposed FoxConn employees, who turned out to be China Labor Watch ringers. China Labor Watch was the organization that assisted Michael Daisey in making his "documentary," The Agony and the Ecstasy of Steve Jobs, that wound up being pulled from NPR for misrepresentation of interviews that turned out to include numerous mis-translations made by China Labor Watch, that when re-translated by other Chinese speakers, showed that China Labor Watch lied about what the workers actually said. . . and that in reality the actual answer was often the exact opposite of China Labor Watch's translation.

Many of your claims from China Labor Watch do not even apply to the Apple Assembly Lines.

Sorry, China Labor Watch is just not credible, and they did it to themselves.

Finally, on this issue, China Labor Watch is not based in China. Wikipedia — "China Labor Watch (CLW) is a New York City, New York-based non-government organization" Catch you in one lie, nothing you or they say is credible from then on.

The report that mad_as_he$$ linked reported that yearly audits performed by a legitimate labor organization found only 349 underage workers among 1.5 million workers in Apple's contractors in 11 countries over a period of seven years. Those are workers from 16 to 18 years of age. They found no one younger and all of those they found were using faked IDs or borrowed IDs from relatives. When they were found, they were all offered full ride scholarships to age 25 with continuing pay for living expenses, as required by Apple's contract. . . at the expense of the contractor. The purpose is to discourage deliberate hiring of underage workers.

There is no incentive to hire underage workers because there are literally thousands of adult workers vying for positions for jobs working in Apple lines for every opening. You can find numerous reports of the lines when openings occur. . . and the pay is the same regardless of the age of the workers. You have a logical failure if you think that any of these companies would take a chance on hiring underage workers deliberately to save money. . . because there are no savings to be made. . . or any need to do so.

The only ones who have any motive to seek jobs at these factories are the underage workers themselves. . . and the do what underage workers do everywhere in the world to get the jobs: they cheat, they lie, and the forge documents to get the jobs.

Do you seriously think that there's a conspiracy by Apple to hire 0.0000023% of 1.5 million workers? Or that you can seriously say that Apple's products are manufactured by child labor with that percentage of workers? If so, you are really completely delusional.

Only Apple is monitoring the conditions on their assembly lines seriously. . . and you choose to attack Apple. Here is a partial list of 52 of the over 500 Consumer Electronic companies that contract with FoxConn for their work. . .

Acer Inc. (Taiwan)
Alcatel (France)
Amazon (United States)
Apple Inc. (United States)
Archos (France)
ASRock (Taiwan)
Asus (Taiwan)
Barnes & Noble (United States)
BenQ (South Korea)
Blackberry (Canada)
Cisco (United States)
Dell Inc.(United States)
EVGA Corporation (United States)
Fujitsu (Japan)
GE Thomson
Google (United States)
Griffin Technologies (United States)
Gründig Mobile (Germany)
Hewlett-Packard (United States)
HTC (Taiwan)
Huawei (China)
Intel (United States)
IBM (United States)
Kyocera Communications (Japan)
Lenovo (China)
Lenovo/Motorola Mobility (China)
LG Lucky GoldStar (South Korea)
Microsoft (United States)
Microsoft MSI (Taiwan)
Motorola Communications (United States)
NCR (United States)
NEC Casio Communication (Japan)
Netgear (United States)
Nintendo (Japan)
Nokia Oyj (Finland)
PackardBell (Netherlands)
Panasonic (Japan)
Philips (Netherlands)
Pioneer Electronics (Japan)
Samsung (South Korea)
Sanyo (Japan)
Sharp (Japan)
Siemens (Germany)
Sony (Japan)
TCL Communication Technology (China)
Telefunken (Germany)
Thomson (France)
Toshiba (Japan)
Vizio (United States)
Xiaomi (China)
Zoostorm (New Zealand)
ZTE (China)

Now, why do you only blame Apple for all of this labor problem? Are your electronics as clean as Apple is trying to be? Frankly not one of them is even trying as Apple is. They join organizations to give them selves lip cover. Only Apple is attempting to directly do anything about it.

You guys will stop at nothing, will you? Now you enjoy as well, Rina.

Foxconn: The Fire That Wasn't
BY Brad Hall| 03/15/12 - 09:41 AM EDT
NEW YORK (TheStreet) -- Over the past month, media reports have made Foxconn (FXCNY.PK:OTC) the icon of Chinese labor suffering. Headlines from The Telegraph (March 7) read "iPhone Workers Beg Apple for Better Working Conditions." Daily Tech wrote, "Employees at Apple's Hellish Foxconn Factory Feel Life is 'Meaningless'." Sounds like a scary place.
My office building shares a property line with Foxconn's largest plant in Shenzhen. Every night I see Foxconn employees at restaurants. They seem happy, but after reading many articles, I've come to view them with pity. Yet, friends who work as consultants to Foxconn tell me that working conditions are quite good.
There are thousands of factories in the Pearl River Valley and a there is free flow of employees between the factories. I wondered how could a company be so abusive and yet so successful? It seemed to defy logic.
I began to wonder, "What does Foxconn look like through the eyes of its employees?"
Foxconn is a Taiwanese-owned company that produces about 40% of the world's consumer electronic products and is Apple's (AAPL_) largest supplier. Its largest factory in Shenzhen employs approximately 300,000 young adults. It's beyond huge. As a personal disclosure, I am neither related to, nor friends with any FoxConn employee and I do not own Foxconn stock. I do own AAPL.
Most FoxConn employees come from the countryside where their hardworking families have farmed the same land for many generations. They dutifully send home part of their paycheck each month.
From 1988 until 2009, four Foxconn employees attempted suicide on-site (0.18 per year). In 2010, that number increased almost one hundred times to eighteen. In 2011, it fell again to four. What happened in 2010?
In 2010, embarrassed by bad publicity, the company offered condolence pay packages equivalent to 10 years' salary to families of the deceased. This was widely reported in China and company officials say the incentive served as a call for depressed individuals to join Foxconn and leave life with honor. Foxconn CEO, Terry Gou read this letter to shareholders: "...now I'm going to jump off Foxconn, really leaving now, but you don't have to be sad, because Foxconn will pay a bit of money, this is all your son can repay you now."
In the second half of 2010, Foxconn publically stopped the condolence payments. In 2011, the suicide rate dropped by almost 80%. It is important to note that even at its peak, Foxconn's suicide rate was 1.5 per 100,000 vs. 3.1 per 100,000 in China -- half the suicide rate of society at large.
Maybe the suicides were not about labor conditions.
Last week, my colleague Jiangying, a 23-year-old Chinese woman, and I randomly interviewed 22 Foxconn employees to see their world through their eyes. We assiduously adhered to behavioral science protocols for unbiased questioning, but you can judge for yourself. Here are our questions and here's what we heard.
"Tell us about your day at work. What do you like and not like about your job?"
Most told us that their job was "OK." No one brought up the topic that work was too demanding. So we asked about their work demands. Almost all said they were reasonable. Surprisingly, one third said their workload was "light or "easy," but none of these worked on the production line. We asked them if their friends were satisfied with their jobs. All but two either said "yes" or "I don't know."
We asked if their work area was clean and safe. All said that it was.
Because we did not hear unsolicited complaints about their work, we asked a leading question, "Do your friends often complain about their work?" A strong majority said that they know people who complain about their work. However, the nature and intensity of the complaints did not seem unusual from what one might expect in any work place.
"Tell us about your pay."
Only a few brought up pay without this question. One said, "The pay is too low." We asked, "Is the pay lower than other factories?" She said, "The pay is the same, but other factories give more overtime. I am losing 1,000 RMB per month!" She went on to tell us that she stays because there is so much career opportunity at Foxconn when compared to a typical Shenzhen factory.
In our first day of interviews, we asked about the infamous 12-hour (7 a.m. to 7 p.m.) days, but no one knew about these work hours. We returned on the second day determined to find the answer. We asked equipment supply people who serve many production lines. They insisted that no one works 12-hour days. We even stopped a female janitor. She didn't know either.
Ironically, the biggest dissatisfaction by far, was lack of overtime. Most of those we interviewed work the 8:00 a.m. to 5:30 p.m. shift with a 90-minute lunch break. With one exception, all said they wanted more overtime -- especially Saturday work. Saturday pays double time. Saturday work is competitive and, at best, employees are limited to one Saturday per month. Additionally, some told us that the maximum allowable overtime for their group is 16 hours per month while others said that their maximum is 36 overtime hours per month.
"What do you do after work and on the weekends?"
The vast majority of Foxconn employees are between 18 and 25 years old. Three hundred thousand, mostly single, young adults who did not go to college and leave work at 5:30 p.m. Their interests are the same as any young adult. They play pool, soccer, surf the internet, eat with friends and date. But, like new college students, most were homesick and said they want to go home.
"Tell us about your manager."
Only two said they did not like their manager. A small group had no opinion, but the majority smiled and when we asked this question. They said they liked their manager.
After all the interviews, we wondered, "Where's the fire?"
Last month ABC News aired an "exclusive inside look" of Foxconn. It was 15 minutes of sensational build-up about sweatshops - smoke, with no fire at all.
The ABC crew was given permission by Apple to talk to anyone about anything. Their gotcha moment was a chat with one young lady edited down to one leading question, "If there was one thing you could change, what would it be?" The young lady said the dorms are too crowded and the trees block the sunlight. That's their best shot?
Last week, the Fair Labor Association began a formal Apple-sponsored investigation of Foxconn. After his first visit to Foxconn, the gray pony-tailed president of the FLA, Auret van Heerden said, "The facilities are first-class; the physical conditions are way, way above average of the norm." Being "way, way" above average is not what one might expect from the "hellish Foxconn factory."
In today's highly connected, blog-filled world, what is the probability that, in a random sample of 22 Internet-savvy employees, no one has either personally experienced or heard of the oft repeated stories of abuse?
These are two fundamentally different representations of reality. Maybe the fault lies with media members who want to believe in Chinese labor abuse, maybe it's that sensationalism sells or maybe it's simply lazy writers forming opinions from others' opinions. The root cause is unclear. (Emphasis mine — Swordmaker)
But one thing is certain -- the media is not telling you the truth.
At the time of publication, the author was long AAPL, although positions may change at any time.
Hall is managing director of Human Capital Systems
(www.humancapitalsystems.com), a firm that designs systems for improving workforce performance. He is also an instructor in Duke Corporate Education's teaching network and author of The New Human Capital Strategy. Hall was formerly a senior vice president at ABN AMRO Bank in Amsterdam and IBM Asia-Pacific's executive in charge of executive leadership and organization effectiveness. During his tenure, IBM was twice ranked No. 1 in the world in Hewitt/Chief Executive magazine's "Top Company for Leaders." Hall completed his Ph.D in industrial-organizational psychology at Tulane University, with a dissertation on people management practices of Japanese corporations.

And the link that, Mac_as_He$$ provided when he made the same claim in another thread. . .

What happens when Apple finds a child making your iPhone

Quartz — by Tim Fernholz
March 07, 2014

There are more than 1.5 million workers making products for Apple, and some of them are children.
The company knows this, and it will tell you: In 2013, it audited 451 different facilities in 16 countries, and found 23 people who had been hired when they were younger than 16. Eleven were still underage at the time of the audit. In all of its publicly available audits, from 2006 to 2013, the company has found 349 child laborers.
What happens after they are found?
The dark crevices of the supply chain

There could be as many as a dozen different suppliers between raw materials and the finished iPhone, iPad or Macbook you hold in your hand. The most responsible companies look perhaps two or three steps down, supply-chain responsibility experts say.

In 2010, Apple’s reliance on this mostly-foreign supply chain led to the worst public-relations scandal in its history: A spate of worker suicides highlighted the conditions at Chinese factories run by Foxconn (a.k.a. Hon Hai), the Taiwanese manufacturing giant. No matter that Apple wasn’t the only company that hired Foxconn to build its products—HP and Dell do too, among others—success made it a target, as customers began to ask where their magical devices came from.
This forced Apple to begin a long process of improving how it monitors its supply chain. In 2006, the first year it began auditing suppliers, Apple looked at 11 factories and didn’t have a program to train suppliers in its labor standards; in 2011 it visited 229 and had trained 1.5 million managers and workers. By 2012, Foxconn pledged to end the 100-hour work-week and adopt some minor wage hikes.
The same year that Foxconn’s suicides became news, Apple discovered 91 underage workers in the factories making its products. Forty-two of them were found at a single facility in China that had partnered with a vocational school which forged hiring papers. You can see how it drove up the numbers in the chart above. Apple promptly stopped doing business with the company and reported it to the government. A similar incident contributed to an even bigger spike in 2012 (more on that in a bit).
Think of the children

But firing the supplier was clearly not enough, given the questions the company was facing. Its executives decided to adopt a program designed in 2008 by Impactt, a social-responsibility consultancy based in the UK that operates in China, India, and Bangladesh. The plan calls for Apple to make any transgressing supplier pay not only for the education of any child laborers it is found using, but also keep paying them wages until they graduate (thus removing their incentive to stay out of school). Apple follows up with the former workers to ensure they are still in school.
The idea is to deter suppliers from hiring children, while making sure any they do hire end up back in school. Dionne Harrison, who manages these programs for Impactt, says her local staff go to the factory to meet the workers, figure out their actual age and, eventually, meet their families, in an effort to convince them to go back to school.
It sounds like a good deal. Yet most of the time, the young workers don’t take it.
A 34% participation rate

Apple executives declined to discuss their child labor policies with us or say how many underage workers have entered the remediation program, which a spokesperson confirmed began in 2010. Impactt manages Apple’s program along with those of two other companies; in its most recent report (pdf), the consultancy said only 34% of the child workers offered the chance to participate in the program in 2011 went back to school. Harrison says the participation rate is about the same today. Before 2011, it was even lower; from 2006 to 2010, only 60 of 330 children found working in factories in China, India, Turkey, Vietnam and Bangladesh returned to education.
Why not take the stipend and the schooling? Sometimes, by the time auditors discover a worker was hired as a child, she is already of working age. Other times, the underage laborers don’t like school and prefer to work. But there’s also the rising pressure to earn more money. In China, as the economy grows with more and more foreign production, the cost of living has in the last decade started rising faster than wages. “In terms of workers feeling the pinch, they feel it much more now than they’ve ever done before in China,” Harrison says.
The problem of child labor

Rising wages have put pressure on manufacturers to move inland, automate, or even get out of the country altogether. But for second- and third-tier suppliers who don’t have those options, cheaper labor may be all that’s left. It’s “one of the reasons you see an increasing number of dispatched workers or workers on these so-called internships,” Dan Viederman, the CEO of Verite, a consultancy that works with Apple to resolve problems with migrant laborers trafficked into sub-contracted factories. Child laborers can wind up working far from home, as part of the wave—now gradually receding—of workers heading from the Chinese heartland to coastal factories.
That’s one reason that Asia remains the world leader in child labor—though there as in other regions, the phenomenon is declining, thanks to industrialization. (Of the one in 10 children around the world who work, most are subsistence farmers.)
In Apple’s most public child-labor incident—and the only one to date where it has named and shamed its supplier—auditors discovered in 2012 that a company called Guangdong Real Faith Pingzhou Electronics had hired 74 underage workers after a labor agency, Shenzhen Quanshun Human Resources, helped families forge proof-of-age documents for their children. Apple terminated its contract with the supplier, and made the company return the children to their families, as well as offering them its remediation program.
Apple publicized the case, seeing an opportunity to warn suppliers, improve its public image, and ding competitors. “If they’re not finding [child labor], they’re not looking hard enough,” Apple’s SVP of operations told Bloomberg last year.
One Apple competitor, Samsung, the largest manufacturer of phone handsets in the world, said it found no underage workers (pdf) in its factories in 2012. The company didn’t respond directly to questions about how it addresses child labor, but it said that because 90% of its parts are made at its own facilities and not outsourced, it can “offer world-class working conditions and maintain the facilities in accordance with international labor standards in all regions in which it operates.”
Labor activists dispute that: In 2012, the NGO China Labor Watch found eight facilities (pdf) either directly owned or contracted by Samsung with significant labor violations, including underage workers and exploited student workers.
The price of progress

The same activists say it isn’t true that conditions for most Chinese workers have improved over the last few years. Apple, says Kevin Slaten, who works at China Labor Watch, is better than its rivals at communicating with the media, NGOs, suppliers and their workers, and he has witnessed its work to return child laborers to school. But China Labor Watch says conditions in the factories still have not improved much, and long hours and unpaid overtime dominate. Such conditions, already harsh for adult workers, are even worse for kids. Last year, a 15-year-old used a fake government ID to get work at a Pegatron factory building Apple’s latest iPhone. He died of pneumonia after working 12-hour days, six days a week, well over the legal hour limit for adult workers.
“[Child labor] is relatively low percentage of the labor violations happening in the supply chain, a relatively inexpensive thing to take care of,” Slaten says. “To pay a million workers unpaid overtime wages, it’s going to be a little chunk of their profit margin.”
Apple’s latest responsibility report says it found 71 facilities underpaying its workers in 2013, and forced them to repay $2.1 million in back wages.
“As far as where the multinational companies fit in this, they are not Chinese themselves, probably don’t have Chinese management, but they are taking advantage of the fact that labor enforcement in China has been lax,” Slaten says. “That there’s a governance gap doesn’t mean they can profit off it.”
But multinationals have long profited off loose labor standards in China and other emerging markets, much to the chagrin of manufacturing workers in the wealthy economies. The pressure such companies face after tragedies like the Foxconn suicides or last year’s collapse of a textile factory in Bangladesh means that they sometimes pay a price, but most of the time, the tolerance for systemic labor violations abroad suggests the price isn’t too high.
On the other hand, the work those companies create has helped lift millions in China out of poverty. “Trade is a good thing, a very good way to redistribute wealth, much more effective than aid,” Harrison says. And as people become more prosperous, she says, they’re demanding better conditions. “If you’re comparing like with like, conditions are better now [but] expectations are changing, and what workers want from their jobs is also changing. Their perceived quality of job is probably worse now than it used to be.”

By the way, when some manufacturers tried to cut overtime hours, the workers went on strike demanding they be restored . . and in fact that so-called mass suicide threat that was attributed the Apple workers? Didn't happen with Apple workers at all. Microsoft Xbox workers were taken off of that assembly line which offered lots of optional extra overtime work and moved to an ASUS laptop case assembly line which did not offer extra overtime work. 150-200 of them took over the roof of the factory in protest and as a negotiation ploy, threatened mass suicide if they were not returned to the Xbox assembly line or offered extra overtime. These are FACTS, Rina, not myths. The closes Apple assembly line was 150 miles away in a different city. Sorry if you don't like facts.

Enjoy.

Cross platform consultant. To Apple? With Apple equipment? Depends upon Apple for your livelihood?

WOW! You have trouble reading? Cross platform means exactly what I wrote. Apple OS X is a platform. Microsoft Windows is a platform. Microsoft DOS is a platform. Apple iOS is a platforml Google Android is a platform. Linux is a Platform. Unix is a platform. THEOS is a Platform. There are many platforms. I've supported all of them for clients and am familiar with them all. My business consult me on all of them. I make one hell of a lot more money off of Windows using clients than I do off of Apple OS X using clients, mostly because they have a hell of a lot more problems. . . SHEESH!

However, I am not dependent on any of them for my livelihood. It keeps me busy in semiretirement.

You anti-Apple people keep trying to prove that I am lying because I have some type of connection to Apple. I am interested in the truth. . . so I provide it. I have told you that I maintain the Apple Ping list on FreeRepublic, that is all. The members expect the facts, not myths that FUD peddlers keep bringing up.

I think the CWI stories are true too.

My thesaurus says that a synonym of "stories" is "anecdotes". The same thing you offer about Apple and Steve Jobs. The plural of anecdotes does not equal data, Rina. I provided data with links to the authoritative source.

As I said, you want to believe. . . and what you want to believe has been provided by an agenda driven left wing organization that YOU claimed was "based in China"—which is part of their propaganda—that I showed you, again with facts—was actually based in New York. You prefer their propaganda anecdotes over the data provided by independent, real labor organizations that are really world wide, and not agenda driven. YOU are the true believer in myths, not I, because those myths provide you with confirmation of your bias.

Children are easier to train? BS, Rina. You just claimed they got minimal training.

I provided you with the facts which are easy to check and you prefer to believe your myths. . . and extremely low aberrational numbers of juvenile employment as though they were the normal operations. YOU are delusional.

China has a national interest in an educated workforce just like the US has. . . and wants its young people in school, not on assembly lines. They have a surplus of adults to work on assembly lines, and have strong labor laws against it. I have shown you that Apple has placed STRONG economic dis-incentives for hiring underage workers. So why do you keep harping on ridiculous falsehood?

Here is a partial list of the top 52 of FoxConn's over 500 consumer electronics manufacturer customers I've been able to compile from news articles where their contractural relationships were mentioned over the past seven years, which include the period when the suicides and your claimed underage employment occurred:

Acer Inc. (Taiwan)
Alcatel (France)
Amazon (United States)
Apple Inc. (United States)
Archos (France)
ASRock (Taiwan)
Asus (Taiwan)
Barnes & Noble (United States)
BenQ (South Korea)
Blackberry (Canada)
Cisco (United States)
Dell Inc.(United States)
EVGA Corporation (United States)
Fujitsu (Japan)
GE Thomson
Google (United States)
Griffin Technologies (United States)
Gründig Mobile (Germany)
Hewlett-Packard (United States)
HTC (Taiwan)
Huawei (China)
Intel (United States)
IBM (United States)
Kyocera Communications (Japan)
Lenovo (China)
Lenovo/Motorola Mobility (China)
LG Lucky GoldStar (South Korea)
Microsoft (United States)
Microsoft MSI (Taiwan)
Motorola Communications (United States)
NCR (United States)
NEC Casio Communication (Japan)
Netgear (United States)
Nintendo (Japan)
Nokia Oyj (Finland)
PackardBell (Netherlands)
Panasonic (Japan)
Philips (Netherlands)
Pioneer Electronics (Japan)
Samsung (South Korea)
Sanyo (Japan)
Sharp (Japan)
Siemens (Germany)
Sony (Japan)
TCL Communication Technology (China)
Telefunken (Germany)
Thomson (France)
Toshiba (Japan)
Vizio (United States)
Xiaomi (China)
Zoostorm (New Zealand)
ZTE (China)

If Apple is so evil what are these companies? I am wiling to bet that a lot of your electronics are made by companies on that list. . . including your cell phone, your computer, your TV, radio, routers, etc. Apple is the only one of these that is putting it's own company paid independent monitors into the its supply chain to assure compliance with the required worker treatment and actively seeking violations of the contract. All of these others join labor organizations in other countries and give themselves pats on the back claiming they did something about it. As I said, you are delusional to claim that Apple is evil based on a left wing agenda driven organization's propaganda.

Again, Rina, I presented facts, with links in the previous post that have actual data, not innuendo and unsupported claims from anecdotes.

Read the actual statements in the second article above from workers who were not pressured to say anything by an agenda driven organization who selected the answers they wanted to publish, but were from random workers just chatting with a guy who worked across the street from the plant for the real truth.

There are more articles in the same vein. . . and many more investigative studies that debunk China Labor Watch's false narratives and Michael Daisey's long discredited and documented lies mostly provided by China Labor Watch.

China Labor Watch attacks Apple and FoxConn with their claims of misbehavior for the same reason that Greenpeace and other environmental groups attacked Apple with claims of misbehavior, even though Apple has done far more in the GREEN and environmental area than other electronic firms. . . because they get far more attention by picking on Apple.

Putting Apple in the headline garners more page views and more Internet clicks. It gets attention for their "causes".

By the way, those 90 hour T-shirts at Apple were worn with pride by people who won them for putting in the effort to get a project out on time. . . not "slave" labor.

However, there’s enough smoke from Apple’s camp to satisfy me that they are - singly and as a group - people I don’t with whom I don’t want to do business.

Did you bother to look at the list of companies contracting with FoxConn? Apparently you just ignore that all those other companies who do business with the SAME contractors but you only DAMN Apple for the bad labor conditions, the ones that are actually associated with other manufacturers, and DOCUMENTED to be so associated in the very news articles attributed to Apple every time. . . and yet Apple is the ONLY company who is actually doing anything about those conditions. You are a hypocrite.

There’s enough evidence out there that Apple’s violated child labor laws through their OEMs for reasonable people to disagree with you, despite the arrogance of your assertions that only your sources are valid, and others aren’t.

There is? Where? Audits by qualified international labor organizations have been performed and they cannot find any deliberate conspiracies to employ children at these factories in violation of Chinese Labor Laws. Have they found underage workers? Yes. . . and in almost every case it was the CHILDREN who had violated the law by forging or borrowing documents to be able to get hired.

WOW! You don't believe audited studies done by respected independent agencies who found a total of 349 underage workers in 11 countries in seven years and prefer to believe rumors from an agenda driven left wing organization? I showed you the SEVERE economic PENALTIES that accrue to a contractor being found hiring underage workers or not meeting Apple's stringent standards. . . yet you STILL maintain they accept these bad actions.

Apple actively seeks out violations of its labor standards, unlike the other companies who contract with these assembly contractors. . . and takes action when it finds violations. Yet YOU call Apple unethical!?!?! All of those other contractees join organizations so they can say they care, but don't do diddly-squat, except put out press releases about how bad things are. These are facts, not your feel good twaddle, Rina.

This is more than just the fact that Apple's contractors MUST pay for the education through age 25 of any under age worker found, which is a huge disincentive for any employer to hire anyone under age. IT simply does not pay for them to hire anyone under age and them be on the hook for another eight years of pay plus tuition for their education merely to save a few bucks. If you believe that they ignore those extremely high risks and go ahead and deliberately seek out underage workers, you are really delusional.

Apple has historically CANCELLED contracts worth BILLIONS of dollars with contractors who did not meet these standards. . . and it cost APPLE money because they took that work to another contractor that cost them more! No company is going to risk that kind of money, again for a few bucks in savings.

Are you that deluded you ignore the historical record???? Apparently you are.

Those penalties are reasons why the audits only found 349 underage workers among 1.5 million workers in Apple's supply chain. It simply is not worth it to hire them. Use your common sense that God gave you. The management of these businesses are simply NOT that stupid to risk losing their contracts or incurring the costs associated with hiring underage workers.

Apple's Contracts on the Apple Music service, which I have read, and you obviously have not, did indeed compensate the independents for the use of the music during the trial period. The conflict was just over WHEN they were going to be paid. Apple even gave the a higher percentage to compensate them for not being paid during that period. I also understood WHY they were not going to be paid during that period, reasons that had to do with the Generally Accepted Accounting Principles, (GAAP), which require that such payments be made from the revenues from which they are earned, which again, you obviously don't have a clue about. There were no "royalty violations" just a disagreement about when the royalties would be paid.

We are talking about a few hundred thousand to a couple million dollars here. It was not big bucks for anyone, but especially for Apple. It was all about accounting rules and and the bean counters, and when people were going to be paid.

Again, your anecdotal stories are not the equivalent of data. . . and that's all they are, anecdotes. I provided data. . . and links to that data from qualified sources. NOT from left wing agenda driven organizations that were not what you claimed, "based in China".

If you don't like them, your solution is simple. Don't do business with them. . . but then to be honestly consistent on the labor issues you have to stop doing business with every single other business on that list that does business in China as well.

Will you? I sincerely doubt it. The suicides occurred at a plant working for Microsoft, Sony, Nokia, and HP. . . not Apple. The mass suicide threats occurred at a plant making products for Microsoft, Asus, and HP, not Apple. Are you dropping them from your product lists?

There was only ONE SINGLE suicide associated with Apple products and it occurred two years before the spate of suicides and involved a mid-level engineer at FoxConn who was questioned by Chinese Police for the theft of an iPhone prototype. After being released by the police and told to be available for further questioning, he went home to his apartment in the city, not a dormitory, and jumped from his fifth floor (IIRC) balcony. That is it.

Exactly what are the unethical business practices you claim occur? There are a lot more I can point to from the Microsoft side. . . friends of mine who had their copyright IP stolen by Microsoft, and then bankrupted by the lawsuits. Those are unethical business practices. As far as I can see, Apple has always tried to license any IP it uses, not steal it.

I have lived a lot longer than you and I have been a CEO. . . I think I know a lot more about how the world works than do you. My college days were twenty years before yours. I too have known people who worked at Apple and people in China who do business with them . . . and have become rich because of it. . . and also some who have become NOT POOR because of it.

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