Did Apple's Apology Scare Off iPhone 5 Buyers?

Friday, 28 Sep 2012 | 12:49 PM ET
iPhone Google Map (L) and Apple's new mapping app (R).
Getty Images
iPhone Google Map (L) and Apple's new mapping app (R).

Apple owned up to its messy map problem Friday, apologizing for the frustration it has caused users since its launch last week.

But by admitting the company's maps system is faulty, did Apple ward off potential buyers?

Probably not, said Scott Sutherland, an analyst for Wedbush Securities.

While Apple's apology for its maps system may make consumers think twice before buying the iPhone 5, the map issue is not going to drive buyers away in droves because there are other map applications available, Sutherland said on CNBC's Squawk on the Street Friday

"I think for anyone who got use to the Google Maps and anything on those maps, clearly this could be a bit of a reason not to go out and buy the next iPhone," Sutherland said. "But as Tim Cook said, there are many other applications out there. Some great crowd sourcing applications...And most of these can be downloaded on the current iPhone, so you're really not missing too much."

In a letter posted onApple's website Friday, CEO Tim Cook formally apologized for the frustration the new mapping system has caused users. Cook said that he was "extremely sorry" and assured Apple users that the company is doing everything it can to make their system better.

Apple's Map App Apology
CNBC's Jon Fortt reports the tech giant's CEO made a rare apology for its map application. Also, the impact on the company's stock and customer loyalty, with Scott Sutherland, Wedbush Securities.

Cook also encouraged users of the new operating system, which features Apple's mapping system, to download other map apps from Apple's app store, including Microsoft's Bing, MapQuest and Waze.

While Cook's apology may discourage some iPhone owners who are afraid of losing Google Maps to upgrade to the iPhone 5, the map app isn't really a deciding factor for most consumers looking to but the latest iPhone, Sutherland said.

"When I look at the maps application, I think it's something really on the fringe. It's not going to be a reason why I'm going to go out and buy the phone or not buy the phone," Sutherland said. "It's the larger screen size, the faster speeds. I think that's why I'm buying the next iPhone here and not for maps."

Apple's stock was down over one percent on Friday at about $672. Sutherland said he sees this as a buying opportunity for the stock and expects it to rise after earnings are released for both the September quarter and December quarter.

"I don't think Maps is having too much of an impact on the sales. We are seeing great demand," Sutherland said.

email: tech@cnbc.com

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  • Matt Hunter is the senior technology editor at CNBC.com.

  • Cadie Thompson is a tech reporter for the Enterprise Team for CNBC.com.

  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.

  • Jon Fortt is an on-air editor. He covers the companies, start-ups, and trends that are driving innovation in the industry.

  • Lipton is CNBC's technology correspondent, working from CNBC's Silicon Valley bureau.

  • Mark is CNBC's Silicon Valley/San Francisco Bureau Chief covering technology and digital media.