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City of San Francisco stops buying Macs without EPEAT certification
Yesterday TUAW reported on Apple's withdrawal from the EPEAT green electronics registry, along with a note that federal, state, and local governments might balk at buying Macs as a result. The City of San Francisco, CA has announced that letters will be sent to all 50 city agencies over the next two weeks notifying them that Apple desktops and laptops will no longer qualify for procurement. Will this have an impact on Apple's bottom line? Well, in 2012 the City purchased a total of $3.8 million on desktops and laptops -- only $45,579 of that amount was for Apple products including iPads. iPads don't fall under the EPEAT certification and wouldn't be subject to the purchasing ban. Gartner analyst Michael Gartenberg was quoted by the Wall Street Journal as saying "Given the relatively small percentage [of organizations] that require 100% EPEAT-compliance, it's not going to make a whole lot of difference to Apple." Despite Apple's withdrawal from the EPEAT standards (which it helped create in 2006), the company's green record is better than that of many other electronics manufacturers. Apple publishes annual environmental reports online showing both successes and areas that need improvement, and the company sponsors recycling programs both online and through the retail outlets.
Exploring Apple's supply chain secrets
One of the unsung heroes in the success of Apple over the past ten years or so has been the ability for the company to take control of manufacturing, procurement, and logistics of its products in ways that are completely innovative. In a Bloomberg Businessweek post yesterday, writers Adam Satariano and Peter Burrows did a deep dive into what makes Apple so successful in terms of operations -- an area where Apple CEO Tim Cook excels. According to the article, Apple has "built a closed ecosystem where it exerts control over nearly every piece of the supply chain, from design to retail store. Because of its volume -- and occasional ruthlessness -- Apple gets big discounts on parts, manufacturing capacity, and air freight." The supply-chain management success story apparently began when Steve Jobs returned to Apple in 1997. At that time, most computer manufacturers shipped their products by sea, which was much less expensive but also slower. Jobs wanted to ensure that the translucent blue iMacs that had just been introduced would be available for Christmas 1998, so he had the company pay $50 million to buy up all available holiday air freight space. Companies such as Compaq later tried to book air transport for holiday shipments, only to find that Apple had monopolized the space. Apple's ability to manufacture a product and ship it right to a customer's door began with the iPod era, and an ex-Hewlett Packard exec recalls that an HP staffer bought one and received it a few days later, watching its progress from factory to home on Apple's website. Mike Fawkes, who was the supply-chain chief at HP, recalls that "it was an 'Oh s---' moment." By doing this, Apple was able to avoid keeping large inventories of product on hand Apple also buys up speciality equipment, including customized lasers that are used to poke the almost-invisible holes that are used to emit a green dot of light on many of the company's products, including the MacBook Pro and MacBook Air, as well as the Wireless Keyboard and Magic Trackpad. Those machines cost about $250,000 each, and Apple has bought literally hundreds of them to add a touch to its products that few people may notice. The Bloomberg Businessweek article is a good read, and fascinating for anyone who has an interest in what goes on behind the scenes at Apple.
Google drops cloud computing lawsuit against US Department of the Interior
Last year, Google filed a lawsuit against the US Department of the Interior, on allegations that the government unfairly awarded a $59 million cloud computing contract to Microsoft without conducting a sufficiently competitive auction. Big G won an injunction against the department in January, effectively putting the contract on hold, and it looked as if the company would prevail, with Judge Susan Braden recently declaring that there was a "justifiable basis" for dispute. Last week, however, Google decided to drop the suit altogether, after filing a motion in the US Court of Federal Claims. "Based on the defendant's agreement to update its market research and then conduct a procurement in a manner that will not preclude plaintiffs from fairly competing, plaintiffs respectfully move for dismissal of this action without prejudice," the company's attorney wrote in the motion, filed on Thursday. Federal lawyers, however, responded by claiming that the two sides have not reached an agreement, while confirming that it had no problem with Google's decision to cease litigation. It remains to be seen whether the two sides have truly reached an agreement, or whether the litigation may wear on, but we'll keep you abreast of any future developments.
HP agrees to pay $55 million to settle investigation into illegal kickbacks
The company that kicked Mark Hurd to the curb for financial impropriety has today reported it'll pay $55 million in a settlement with the US Department of Justice relating to some fiscal delinquency of its own. HP was accused of greasing up the wheels of business, as it were, by throwing cash around to companies who would recommend its services to state procurement agencies. This particular set of allegations related to a federal contract obtained by HP in 2002, and the settlement also extinguishes investigation into whether or not the computer vendor had provided incomplete information to the US government. That's all well and good, but we have to question the size of these levies. Today's also the day that HP's announced a new $800 million supply contract with the US Air Force -- would a fine that's less than a tenth of the contract's value really deter HP's entrepreneurial spirit?
