Buzz Out Loud
Apple and the Foxconn problemIn this excerpt from Buzz Out Loud, Brian Tong and Molly Wood discuss the growing concerns over working conditions at consumer electronics factories in China. Is it time for Apple to step in?
Not as upset though. As the New York Times. Like six page article seven page article this is huge on conditions inside Foxconn. And that and basically a larger story about the conditions around building -- electronics which has been a -- bubbling up -- for on time but this is. This is an upsetting read and yeah -- really important. I think you guys should all take this out it addresses. More specifically in this article it talks about Apple's dealings with manufacturers like Foxconn and suppliers and how they've dealt with. The conditions inside of -- now they do point out and we all know that Foxconn does supply. Product's final goods for a variety of companies like PL Lenovo IBM. But this is kind of the focus on this specifically with Apple as we've heard about you know how there is -- explosion. I think maybe somewhere around four to five months ago and one of their factories on where four people died. But also just the overall trend. Of how much are they really do lean. To change and make improvements because you have -- -- side Apple just reported their earnings and we if you know or read those. They were off the charts -- 43 billion dollars in revenue thirteen billion net revenue record sales for ipads. Macs and iphones. Right. -- see these numbers and Wall Street is just blown away by them but there's a cost that's involved in this in this is they human costs. In these products how hard are they working these people what are their living conditions really -- In this article the New York Times goes on -- like we said it's a long six page article they talk about how. Apple was once it was brought to their attention. Apple was one of the first companies that's it okay we're gonna do audits of these suppliers and factories. And talk about and point out where they have violations whether underage workers people working in over sixty hours a week. Six or seven days in a row how long -- their shifts so Apple has tried to send out reports of suppliers and companies that are -- these policies. The problem even then even at that Delray -- the problem -- although they are marked you know mentioning these they have. In their contract Apple says they have the right to terminate their contract agreement with any supplier -- -- these policies. -- the ratio of actual suppliers -- terminated -- the violations across the board. It's terrorists is there there's no parity that is has an internal. Hated me B seventeen people. All of the contracts remain in place and these are audits by the way that have been happening in some form since 2005 they got a lot more serious in 2007. But. A lot you know this article quotes several former Apple executives are saying -- if we wanted the stuff to stop. It would stop their finding violations every single year in the audits including. Dozens as many as seventy in one case what -- -- core violations which are violations that involve hiring underage workers. And improperly disposing of toxic waste forcing people to work in patently unsafe conditions. And it's sort of like they just read a story about it here but the problems don't go away and it's really. I mean certainly. The times takes care to point out that this is that an industry -- issue but it does sound like other supply other companies HP Dell Lenovo. Do a better job in some cases of terminating those contracts but Apple. Has created such a cycle of constant releases. And they've created such a consumer expectation. And they squeezed and squeezed their margin so intensely that's always been there away that right that's always been their ways and knowing and so there. I mean there are several experts quoted in this article saying let's be realistic there's no way that Apple's can terminate a contract with fox doubt that is not gonna happen. And there's no way that Foxconn or any other Apple supplier. Has incentive to treat their consumers well because they have to cut costs at every single -- And here's another thing we talk about Apple's secrecy as a company and one of the issues at these reports. Have shown is that Apple name these factories. And suppliers but not where they're located. Because of global secrecy when these suppliers sign agreements if you're if -- supplier in China and also -- like while we're making parts for Apple and have this huge contract. And you sign a confidentiality agreement that says you can't reveal that Apple's when your partners in the reports Apple doesn't reveal where you're located because the secrecy. You you that -- culture of secrecy is going to permeate this and also we wall we don't know. Everything naturally happening these factories you can even find all these factories and know who's doing what. And because of that culture of secrecy that's that's another that's another reason why it's very hard to shed light on this and that's not a good thing that's a horrible thing. And honestly it wouldn't. I think the most in raging quote of all to me in the story with someone who said consumers demand new products every year that was such. Or -- Like no they don't write. Marketing and a constant release cycle has convinced consumers that they can expect these products every year. But lets it that is solely so that companies can make money it's not like I'm senior -- -- I don't have an iPhone every year -- -- I -- does not make it. I mean that's you know that is. It was something that has been conditioned -- and that's a cart before the horse kind of argument. And the fact that. Apple is sitting on an unbelievable cache of money that they made thirteen billion dollars world tour brought revenue my friend that was the pure. Profit part of their -- the fact that they can't spend my end and by many accounts in the story. They have been warned. Very specifically. About. Aging issues and violations and not respond in fact they say two weeks before the Foxconn explosion. A report was sent to Apple. Warning of unsafe conditions and according to almost all of these reports Apple just did not -- And so the did take away of this is that. A as you as a consumer -- how much do you really care about the vice because we've seen how in the past. Sweat -- with that you know. Nineteen gap and other clothing -- people have made noise and protested against these companies for their practices. Are we as a collective group we need to do the same thing with these tech companies and hold them accountable because. I'm sorry I don't want to know that someone died potentially died at the hands of treating my phone that's ridiculous. It's -- it's it's ridiculous so. It's really up to us to start realizing that hey this thing now we have isn't as important as these conditions that we care about and you'll Foxconn has some factories here in the US but one -- the other challenges that obviously the laws and what's morally acceptable in one country for workers' rights. Is different than what's here in the US but it doesn't mean that we have to we should overlook it. -- -- And to my current has asked in the chatroom eyes and why -- -- only talking about Apple we mentioned earlier that HP Lenovo many other electronic companies do business -- and none of them. You business on the scale Apple. And none of them make as much money. Off of -- off of these business practices mean somebody -- -- pointed out. On Krispy it was the fourth best profit report -- fourth quarter thing of all time if they're if there are basically up there with oil companies in terms of pure profit. They have done. Muscle. And the market. Power to make a huge difference here they've known about these problems for years and haven't done anything like the McDonald's right -- when McDonald says okay we're gonna stop. At they MacDonald had huge impact on the beef industry. And the way that cows were being treated basically because they said okay due to market pressure we don't want -- you know be -- have things be as inhumane as they have been. Apple's McDonald's and the situation and they need to be the once -- -- Here's the way to look at this realistically effect if let's say thirty to 40% of all iphones -- that came out these factories were defective. Apple would do something yet to stop them from being defective. Whatever those procedures or conditions are so. Apple should -- like. If that's what's happening with their phones and how they -- need to react the same way but the conditions for these workers at you know when the first on the issues are brought up about -- been underpaid and overworked. Remember Apple went and did an -- and they gave a raise a general raise a -- workers but that doesn't address the conditions. Right the systematic. Problems that are happening over in this factories so really if Apple wants to stand tall and look like the good guy. Within the next six months to yeah I mean I don't know I hope they address this because Tim Cook. His history see his genius or his one of his -- was dealing with the supply chain -- the efficiencies of it at the margins so he knows what's gonna. It's a really I find that really passing too because in some ways Tim -- is coming out as the good guy brightly key he. Restored charitable giving matching Apple or entries at for the first time something -- -- -- resisted. Key is now giving Apple plays big discount on on buying their own products like you know heat in some -- seems like that's really great guy but he is the guy who set up these manufacturing arrangement -- it's on him. It's actually on him personal. -- in a lot of cases to take care of this to deal with it. And I think that it's and that's why we're talking spending so much time talking about it because it is really important like -- pointed out. The consumer can have a big difference -- -- had their past and their N and meet their needs to be outcry about -- it's not acceptable for people to die for your -- just not. Some -- IE I've got imagine with this long. Article that's going to get a lot of play. The we're gonna hear something you know in the near future from Apple -- they're not gonna just like. That sweet this one -- it's totally and we're not either.