Apple CEO Tim Cook vigorously defended his company today from charges that it has enabled the Chinese companies that produce iPhones, iPads and other products to mistreat workers with low pay, long hours, and unsafe conditions. “No one in our industry is doing more to improve working conditions than Apple,” he told the Goldman Sachs Technology and Internet Conference. “We care about every worker.” Although he says “the supply chain is complex” he adds that every worker has a right to competitive wages as well as fair and safe working conditions. “Apple suppliers must live up to this in order to do business with Apple,” he says. He added that hiring of children is “extremely rare in our supply chain, but our objective is to eliminate it totally.” He called use of child labor “a firing offense.” Apple also says it has found violations to its rule capping work at 60 hours a week but has begun to “manage working hours on a very micro basis….We can do better and we’re taking the unprecedented step of reporting this monthly on our website so its transparent.”
Cook declined to provide details about Apple’s television plans. He says, though, that the company’s experience with Apple TV — a box that integrates Web delivered content with conventional programming — showed execs that “there was something there and if we kept pulling the string we might find something that’s larger.” He says that the company sold nearly 3M Apple TVs last year, including 1.4M in the last quarter. If the company decides to offer a more ambitious product then “we need something that can go more main market.”
The CEO says he’s unfazed by companies — including Amazon –that are offering low-priced tablets to compete with the iPad, “Price is rarely the most important thing” for buyers, Cook says. “The joy is gone every day they use it. You don’t keep remembering that you got a good deal, because you hate it…..People at the end of the day want a great product.” He says that Amazon will “sell a lot of units” — but Apple customers “won’t be satisfied with a limited function product.”
As for the iPhone, Cook says that he sees a huge opportunity to boost sales overseas. For example, purchases in China increased 100% last year to $13B. And it could create a halo effect for other products. “The iPhone began to introduce Apple to hundreds of millions of people who had never met Apple before,” he says.
Cook also tantalized investors with the possibility that Apple will return some of its $98B in cash and liquid investments to them either by paying a dividend or repurchasing its stock. “I’m not religious about holding it, or not holding it,” he says adding that “We have more cash than we need to run the company on a daily basis.” He says that the board is discussing the issue “more now and in greater detail….I only ask for a bit of patience so we can do this in a deliberate way.”
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