Is Sarbanes-Oxley Forcing Apple To Charge You To Upgrade Your WiFi?

from the say-what-now? dept

Well, here's a weird one. It's no secret that Sarbanes-Oxley is a law with lots of problems. It's become a huge pain for businesses, forcing all sorts of useless, but expensive, procedures to be put in place that have little (if anything) to do with protecting investors from being taken in by unscrupulous companies. It's been a huge net loss to the economy, and has scared away plenty of companies from the public markets. While that may have held some "bubble euphoria" in check by keeping investment opportunities away from the public, the net result is bad for the overall economy. Last week, there was lots of talk about Jim Clark's decision to quit Shutterfly while blaming Sarbanes-Oxley for limiting what he could do at the company. Now comes the latest odd SOX complaint. Apparently Apple is forcing Mac owners to pay an extra $5 to unlock next generation features of WiFi that were bundled with recent machines. In order to unlock the pre-standard 802.11n features, you have to pay $5, with Apple saying that they cannot be seen as "giving away an unadvertised new feature of an already sold product without enduring some onerous accounting measures." The thinking, basically is that they would be unfairly recognizing the revenue early, since they hadn't completely delivered the product. The alternative would be to not recognize all the revenue ahead of time, but that presents other problems, and could even be more costly. Thus, consumers get the fun of having to pay extra to upgrade. Yet another fun unexpected consequence from excessive meddling from politicians.

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  1. identicon
    Robert K, 17 Jan 2007 @ 12:11pm

    Is Sarbanes-Oxley Forcing Apple To Charge You To U

    Is Sarbanes-Oxley Forcing Apple To Charge You To Upgrade Your WiFi?
    The fact that regulation (like Sarbanes-Oxley ) causes unpredictable negative effects is indisputable, but one has to ask "How much collateral damage are we willing to accept?" Apple'ss puerile fudging with upgrade prices is probably more innocuous than Enron'ss fudging with grandpa's retirement. There are a lot more complaints about SOX from naive enthusiasts and from charlatans, than from people who really have a new product that can meet a market test. SOX has indeed scared away some offerings but many of them deserve to be scared. Apple, for example, spent time and money to design in locks (as is done by virtually every telco). Is that what progress is all about? The crucial point is illuminated in an old economic classic by Gordon Tulloch concerning tariffs, monopoly and thefts. We want more effort devoted to progress, not to locks and subsequently to lock-pickers. Further, SOX is preventing Apple, Shutterfly, and others from pre-booking the entrepreneur's dreamy-eyed projection of revenues. In the tech world we have been drowned by naive forecasts of revenue streams, never mind those spectacular projections from scam artists. If SOX has been a net loss to the economy, the proof will not come from complainants who want to pre-book unverified revenues, nor will it be from agents wasting time and resources designing locks to slow down innovation.

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