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Apple: Paranoid

Do you remember the teaser ads for the iPhone 3G? Two uniformed guards carried a locked metal crate through a labyrinth of secure tunnels, keycard points at every door, and monitored by security cameras? Turns out the real Apple isn't too far from that, according to Brad Stone and Ashlee Vance at the New York Times.

They cite former employees and analysts who all agree that Apple, as Gene Munster put it, "a total black box." Apple, in an effort to guard their company's secrets until the day they're launched have instituted a culture of fear among employees: Loose lips sink ships.

Apple's campus is, according to the article, "a maze of security doors" where employees must swipe their badges and enter codes on numeric keypads -- presumably not only to restrict access, but to serve as a record of who was where if any information does leak out. Many work areas are monitored by closed-circuit TV. According to one unnamed employee, "workers in the most critical product-testing rooms must cover up devices with black cloaks when they are working on them, and turn on a red warning light when devices are unmasked so that everyone knows to be extra-careful."

I've worked in high-security areas before for the U.S. military, and the big difference between the military and Apple is fear. Lots of fear. A secure military workspace is comfortable, but formal: If you catch a glimpse of something you shouldn't, it's not a big deal, just forget what you saw. Apple employees on the other hand, according to the article, are petrified of losing their job, being sued, or both.

In Apple's quiver is another piercing arrow: Misinformation. Piper Jaffray's Gene Munster relates a story of how a high-ranking Apple executive lied to his face about having "no interest in developing a cheap iPod with no screen." Cut to a few weeks later, and Apple releases the iPod shuffle. Lying business executives are nothing new, and shouldn't be surprising in the least. But while many companies cultivate productive relationships with the media, Apple's is mostly antagonistic. "They don't communicate," Munster said.

Why bother? The thrill. Sure, they're protecting their intellectual property, but it's all about the thrill. They can create these spectacles where they literally unveil a new product in front of a salivating audience -- including Apple employees -- who have never seen anything like it before. It's thrilling. Apple's business hinges on creating products that excite and creating that excitement surrounding them.

They've found a secret formula that works. In the words of Steve Jobs, "there is no theory of protecting content other than keeping secrets."

"The problem, of course, is that there are many smart people in the world, some with a lot of time on their hands, who love to discover such secrets."

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