Linked by Thom Holwerda on Wed 21st Jun 2017 12:07 UTC
Apple

In what is surely the greatest bit of irony in the tech industry this week, a recording of an internal Apple briefing on countering leaking has leaked. Tons of interesting insight in the article covering the recording, but this bit jumped out at me, because I never put two and two together in this regard:

Apple's Chinese workers have plenty of incentive to leak or smuggle parts. "A lot, like 99.9 percent, of these folks are good people who are coming to a place that has a job, they're gonna make money, and they're gonna go back and start a business in their province or they're gonna do something else with it, support their family," Rice says. "But there's a whole slew of folks that can be tempted because what happens if I offer you, say, three months' salary?' In some cases we've seen up to a year's worth of salary being rewarded for stealing product out of the factory." Apple workers on the production line make approximately $350 a month, not including overtime, according to a 2016 report from China Labor Watch.

It never dawned on me that leaks could be the result of underpaid factory workers.

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Cost of living
by darknexus on Wed 21st Jun 2017 13:06 UTC
darknexus
Member since:
2008-07-15

I'm genuinely curious about what $350 is worth in China. Is that a high pay for workers or is it low? It sounds low by our standards, however it's all relative to the cost of living and the Chinese economy. I'll have to do a bit of research.

Reply Score: 2

RE: Cost of living
by Messere on Wed 21st Jun 2017 13:19 UTC in reply to "Cost of living"
Messere Member since:
2006-10-12

There's a site that compares cost of living in different cities all over the world.

And it says that 350 USD in Shanghai is like having ~750 USD in New York, USA.

https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=Ch...

Reply Score: 1

RE[2]: Cost of living
by viton on Thu 22nd Jun 2017 15:47 UTC in reply to "RE: Cost of living"
viton Member since:
2005-08-09

Foxconn workers are living in dorms ($20 per month).
Food in factory food court is likely cheaper than in NY.

Reply Score: 2

RE: Cost of living
by Sidux on Wed 21st Jun 2017 14:06 UTC in reply to "Cost of living"
Sidux Member since:
2015-03-10

It's different perspective.
Foreign currency for chinese is more important than local one because a high percentage of local one it's counterfeit.
They also have a well known market for selling replicas and pricing it accordingly.

Edited 2017-06-21 14:07 UTC

Reply Score: 1

RE: Cost of living
by Alfman on Wed 21st Jun 2017 14:27 UTC in reply to "Cost of living"
Alfman Member since:
2011-01-28

darknexus,

I'm genuinely curious about what $350 is worth in China. Is that a high pay for workers or is it low? It sounds low by our standards, however it's all relative to the cost of living and the Chinese economy. I'll have to do a bit of research.



"But there's a whole slew of folks that can be tempted because what happens if I offer you, say, three months' salary?' In some cases we've seen up to a year's worth of salary being rewarded for stealing product out of the factory."

Regardless of one's income, I think the above ratio would be mostly hold true in western countries too. According to glassdoor an apple "service specialist" makes $29k-$41k and "senior manager" makes $83k-$133k. If the black market paid those amounts for leaks I suspect there would be takers especially if they are paid in cash to lower the risk of getting caught.

Physical components that are manufactured in china are probably less accessible to US employees, but information/toolchains might still be leaked. It probably wouldn't be worth it for news purposes. Presumably it could be very useful for government agencies like the FBI, but I'm not sure whether they'd be consumers of black market operations like this. Rivals might have a use. Ironically it's conceivable that China would pay US workers to leak technical information. You never really know, the leakers themselves probably don't know who the buyers are.

Edited 2017-06-21 14:38 UTC

Reply Score: 2

RE[2]: Cost of living
by Delgarde on Wed 21st Jun 2017 22:20 UTC in reply to "RE: Cost of living"
Delgarde Member since:
2008-08-19

Regardless of one's income, I think the above ratio would be mostly hold true in western countries too.


Yeah, the difference is that globalisation applies to corruption too - if the lower absolute incomes mean it's cheaper to bribe Chinese workers than US ones, why wouldn't you save money by going with the lowest bidder? ;)

Reply Score: 2

RE[3]: Cost of living
by Alfman on Wed 21st Jun 2017 23:16 UTC in reply to "RE[2]: Cost of living"
Alfman Member since:
2011-01-28

Delgarde,

Yeah, the difference is that globalisation applies to corruption too - if the lower absolute incomes mean it's cheaper to bribe Chinese workers than US ones, why wouldn't you save money by going with the lowest bidder?



Yes of course! The black market follows the same laws of supply and demand. Although I'm inclined to assume the nature of work (and therefor leaks) would be quite different around the world.

Reply Score: 2

RE[4]: Cost of living
by Lennie on Thu 22nd Jun 2017 17:10 UTC in reply to "RE[3]: Cost of living"
Lennie Member since:
2007-09-22

Yes of course! The black market follows the same laws of supply and demand.


More so than any (?) other market.

Because there are no laws/rules, it's more 'pure' economics (obviously laws/rules still have influence on price, because bigger punishment when getting caught has some influence on price)

Reply Score: 2

RE: Cost of living
by Soulbender on Thu 22nd Jun 2017 03:33 UTC in reply to "Cost of living"
Soulbender Member since:
2005-08-18

Is that a high pay for workers or is it low?


It seems to be rather low, from what I can gather. Average hourly salary for a factory worker in China right now seems to be ~$3.6 which adds up to about ~$570. If that is correct then Apple (or Foxconn or whatever) is not paying a very competitive salary.

Reply Score: 2

hre should be href .. typo
by kragil on Wed 21st Jun 2017 14:53 UTC
kragil
Member since:
2006-01-04
Ya think?
by aliver on Wed 21st Jun 2017 16:43 UTC
aliver
Member since:
2011-03-19

Fatcats never cease to amaze me. These guys offshore to some 3rd world hellhole (Yes, China, I'm talking about you) to folks who are once step above slaves or indentured servants and they wonder how their products and designs leak out? Unbelievable. These people actually expect faithful employees as they race to the bottom. Pure genius.

I would say this is chickens coming home to roost for the suit-weasels, but it's nowhere near enough payback. It's merely just a minor problem compared to the heaps of profits they make.

Apple runs quite a few sweatshops in China. That's a well known and well documented fact. I quit buying Apple products when they quit making them in America. Good riddance.

Reply Score: 5

RE: Ya think?
by unclefester on Thu 22nd Jun 2017 09:39 UTC in reply to "Ya think?"
unclefester Member since:
2007-01-13

Fatcats never cease to amaze me. These guys offshore to some 3rd world hellhole (Yes, China, I'm talking about you) to folks who are once step above slaves or indentured servants and they wonder how their products and designs leak out? Unbelievable. These people actually expect faithful employees as they race to the bottom. Pure genius.


China's standard of living has improved immeasurably in the past 30 years. These workers would easily earn 10x as much (adjusted for infaltion) as their parents did 30 years ago.

In 1982 my university politics professor told us that there were more private cars and telephones in Soweto (a South African apartheid era slum) than in the whole of China.

Edited 2017-06-22 09:40 UTC

Reply Score: 3

RE[2]: Ya think?
by Lennie on Thu 22nd Jun 2017 17:17 UTC in reply to "RE: Ya think?"
Lennie Member since:
2007-09-22

I would think even more than 10x, growth in wages was 12% per year. That would work like compound interest.

China became to expensive and some labor got moved to countries like Bangladesh.

The way automation/robots, etc. is improving and how well economies are functioning now (aka not so good) in the coming decades Bangladesh will not reach the same level China is now and other countries will not be able to reach the same level Bangladesh is now in the same way China did and the path Bangladesh has started on.

Reply Score: 2

RE: Ya think?
by viton on Thu 22nd Jun 2017 18:06 UTC in reply to "Ya think?"
viton Member since:
2005-08-09

These guys offshore to some 3rd world hellhole (Yes, China, I'm talking about you) to folks who are once step above slaves or indentured servants


'Muricans are so exceptional.
Do you know this 3rd world hellhole company Foxconn will invest 10 billions in rusty ex-democracy paradise to build several factories and create 10 000 jobs? =)

Edited 2017-06-22 18:07 UTC

Reply Score: 2

RE[2]: Ya think?
by weckart on Fri 23rd Jun 2017 08:17 UTC in reply to "RE: Ya think?"
weckart Member since:
2006-01-11

Foxconn is Taiwanese. Not Chinese.

Reply Score: 1

RE: Ya think?
by Kochise on Thu 22nd Jun 2017 19:25 UTC in reply to "Ya think?"
Kochise Member since:
2006-03-03

But they produce the greenest non reparable products! And they keep their astronomical profits offshore to also prevent paying back us consumers through taxes.

Reply Score: 2

RE: Ya think?
by tylerdurden on Sat 24th Jun 2017 03:34 UTC in reply to "Ya think?"
tylerdurden Member since:
2009-03-17

China 3rd world? LOL.

It's amusing to me how some terms/words are so misused that at some point they lose all their meaning and they become this weird placeholder for *just something I don't like or agree with*

Reply Score: 2

Unsurprising, really
by dylansmrjones on Wed 21st Jun 2017 17:44 UTC
dylansmrjones
Member since:
2005-10-02

It never dawned on me that leaks could be the result of underpaid factory workers.

This's got to be sarcasm. Being underpaid (and/or unappreciated) is one of the most common causes of leaks.

Reply Score: 4

RE: Unsurprising, really
by ThomasFuhringer on Thu 22nd Jun 2017 10:23 UTC in reply to "Unsurprising, really"
ThomasFuhringer Member since:
2007-01-25

They are stealing so they must be underpaid, is the socialist logic of this.
Actually USD 350 is the average monthly income in a lot of countries in the world, also Eastern European ones, where the cost of living is definitely higher than the South of China.

Reply Score: 2

RE[2]: Unsurprising, really
by Soulbender on Thu 22nd Jun 2017 10:33 UTC in reply to "RE: Unsurprising, really"
Soulbender Member since:
2005-08-18

They are stealing so they must be underpaid, is the socialist logic of this.


Nice try but that's not all what OP said. Simply stating that being underpaid and/or underappreciated is a common cause for theft is not the same as saying that everyone who steal does so because they are underpaid.

Reply Score: 2

RE[3]: Unsurprising, really
by ThomasFuhringer on Thu 22nd Jun 2017 10:52 UTC in reply to "RE[2]: Unsurprising, really"
ThomasFuhringer Member since:
2007-01-25

That is exactly what is stated in the text: "...leaks ... result of underpaid factory workers"
And the fact is that they would steal just as much if they would get paid double. It is all about the opportunity.

Reply Score: 2

RE[2]: Unsurprising, really
by Thom_Holwerda on Thu 22nd Jun 2017 16:00 UTC in reply to "RE: Unsurprising, really"
Thom_Holwerda Member since:
2005-06-29

They are stealing so they must be underpaid, is the socialist logic of this.


What does socialism have to do with any of this?

It's just a simple statement of fact that the method by which leakers get their information - i.e., offering to pay workers for it - is a lot easier to succeed if said workers are underpaid, because the amount offered for the leaked information stays relatively low.

This isn't rocket science, and there's nothing controversial about this at all.

Reply Score: 1

RE[3]: Unsurprising, really
by ThomasFuhringer on Fri 23rd Jun 2017 08:02 UTC in reply to "RE[2]: Unsurprising, really"
ThomasFuhringer Member since:
2007-01-25

It is logically flawed. And it is the typical type of argument brought forward by socialist polemic: Somebody is stealing so it must be the evil employers fault because they 'underpay'.

Ok, lets break it down:
First of all: how do you back up the assertion they are 'undepaid'? Underpaid by what standard? Related to what? Underpaid would mean somebody in the local labor market pays more for the same type of work than another employer. Then workers would simply go and work work there. After all, nobody has ever been forced to work for Foxcon.
Assuming they are 'underpaid' for whatever reason, you would have to establish a cause-effect relationship. Because two things happen in parallel does not necessarily mean one is effected by the other.

Granted, there might be a statistical correlation between poverty and crime, specifically theft. But that would need to be demonstrated by data. And if it is proven you could argue the leaks are somehow related to poverty. Still a different thing than blaming it on somebody for 'underpaying'.

Reply Score: 2