The Ethics of Gizmodo’s iPhone 4G Scoop

First off, I want to make it clear that I really enjoyed Gizmodo’s coverage of the next Apple iPhone. For those of you not familiar with how it went down, the site acquired an iPhone prototype that was lost at a Bay Area bar. It pounced on the opportunity to write a story and produce videos on the biggest Apple scoop of the year. That all seems normal, right? Where it gets murky is the fact that Gizmodo paid money for the iPhone prototype.

According to Edible Apple:

Gawker editor Nick Denton said that the company paid $5,000 for the device, with some reports claiming that additional fees were to be paid if certain traffic goals were met.

That’s a pretty hefty sum, but considering the tremendous amount of traffic the story has generated, it’s probably worth it…until California law is considered. The Guardian noted this tidbit of California civil code that can be applied to the situation (the iPhone situation, not Jersey Shore‘s The Situation):

Any person or any public or private entity that finds and takes possession of any money, goods, things in action, or other personal property, or saves any domestic animal from harm, neglect, drowning, or starvation, shall, within a reasonable time, inform the owner, if known, and make restitution without compensation, except a reasonable charge for saving and taking care of the property.

Obviously the person that “found” the iPhone prototype is in the wrong, but is Gizmodo also in the wrong for buying the device? The Guardian cited California Penal Code 496 PC:

This means that even if you weren’t aware at the time that you received the property that it was stolen (but later learned or suspected that fact), you must immediately contact the owner of the property or the police to avoid prosecution.

The bad news (for Gizmodo) is that the law seems to be against them. The good news is that Apple has had a tough time suing bloggers in the past.

I want to know what you think about the whole deal. Was Gizmodo merely doing its job? Or did the site cross a line?

Source

Author: RPadTV

https://rpad.tv

51 thoughts on “The Ethics of Gizmodo’s iPhone 4G Scoop”

  1. Just doing it's job.

    @Ray

    I left a comment about 496 in the other thread. That is the stance I believe will be taken.

  2. I really think its a huge PR stunt. Ok so maybe it isn't but the exposure for both parties has been incredible. This is our society, we have to be the first to have it so I see no wrong in this…I also celebrate 420 everyday so the law isn't my thing lol.

  3. @smartguy The problem is that there were several instances of Gizmodo saying that it was confident that it was a genuine Apple product. At no point did it try to give the product back to Apple.

  4. @Ray

    It felt that it was genuine because it wasn't given to them in a PS pic with metadata to prove a hoax. I'm sure it really is from Apple. It probably is just a dev test unit for software. I don't find what they did unethical at all. Now if Gizmodo turned around and sold this thing to a competitor like Moto or Dell…then that would be bad.

  5. It's wrong.

    If the circumstances of the story are true, then it's stealing. I don't care how you slice it; stealing (and buying stolen goods) is a crime for a reason. Pawn shops can have their goods forfeited if authorities find any reported stolen goods being sold there regardless of what the owner of the shop knew or not. Granted, these may be local laws, but it seems that CA law is very clear on the subject. Gizmodo benefited off of stolen (or suspected stolen) property and they should pay the consequences for that.

    After all, how would you feel if you were an inventor of a greatly anticipated gadget and it got "lost" only to appear days later on a popular tech website? Would you not be clamoring for justice then?

    -M

  6. They are in the wrong for paying for it. That encourages such behaviors. Also, they knew it was lost from the start and shouldn't have paid for it for that reason alone. As soon as that person tried selling the phone to them it became stolen. If the phone had been given to them with no money exchanged, then it would be alright.

    Still think it is wrong for them to take the phone apart though. No loop holes on that one because you don't mess with peoples phones like that.

  7. @Ray

    If it was indeed from Apple. There in lies the loop hole. It wasn't until they took it apart that they learned that they were pretty sure it was the property of Apple, or the guy who lost it.

    Both sides have some shoving to do. Apple can contend that Gizmodo intended to withhold the property. They could try and say that Giz aided the thief by purchasing the device.

    Giz can and most likely will assert that they didn't believe the property was stolen. They will support this by saying they felt good about the deal because they put their name on the story and by offering up the fact they paid for the item there is surely a legitimate legal transaction. If Giz had paid for the device in off the books cash, that would be a sure sign of guilt.

    I know La. law very well, but Cali law and past court decisions would take me more than an hour to go over.

  8. @ topic

    If they haven't returned it by now… then they are in the wrong.

    @ Smartguy

    There are actually iPhone apps that are the CA law codes. I have 4 of them on my phone and review them often actually. I have the Penal Codes, the Civil codes, the vehicle codes, and the Health and Safety codes.

    CA laws start with the businesses here. CA is responsible for like 90% of the nations produce. On top of that, the silicon bay can also be called the pharma bay because of the large businesses that are stationed there. After that, the nation literally uses us as their guinea pigs to try out laws they don't know how they'll work in the national scale. I only assume they use CA for that because of the high, diverse population and the tax revenues that are generated here.

  9. the story gets thicker since Gizmodo also reported on the (soon to be terminated) apple employee who misplaced the device, Gray Powel. his facebook app clearly identified him as the owner and apparently neither the person who found it nor gizmodo decided to return it to him or Apple. Reporting on this news is just business, but that doesn't make it legal.

    I know apple has threatened to sue in the past but this is the only legitimate reason I've seen for Apple to sue.

  10. I feel Gizmodo was just doing their job, but then crossed the line. Not just by purchasing the item though, also by naming the gent that lost it. I haven't read any other articles written on this matter that revealed his name, they all just linked back to Gizmodo. And while it is reporting the news and all, I think a little bit more tact/discretion should have been involved—the guy may get fired for this, I really don't think he needs to be publicly embarrassed as well.

  11. I also think they were just doing their job…they review things like this, and what better scoop can you get right now other than one of the hottest selling phones newest iteration being shown to the public for the first time. Like Big Blak said, we are a "we have to be the first to have it " type culture…and this is just the result.

    Now they probably did cross the line by paying for it, and I understand the law seems like it states that what they did was purchasing a stolen good. They also probably should have tried to use it as leverage more against Apple while at the same time actually giving it back to Apple willingly pretty early on, but it was clever of them to get Apple to admit that it was theirs in order to get it back.

    Either way both sides are getting an enormous amount of press due to this, which I would see as positive on both sides.

  12. Though I enjoyed finding out about this, I think it's wrong. Apple takes EMENSE steps to keep their IP and products behind closed doors until they deem it appropriate. This effects their business model and stock prices. Even if it RAISES stock prices, it still doesn't fit their release schedule and puts things way out of wack for them. Even if they just did a review I think this is highly unethical, especially paying for the stolen iPhone. Just my two cents.

  13. I honestly don't know who would buy a 3GS at thie point. It seems like it would hurt sales. Obviously techie people know a new one is coming every year but the general public isn't as observant.

    I am curious what is going in with sides of the device. Apple prefers unibody so breaks in the aluminum does seem odd. It's likely the final device will be unibody but maybe the breaks will be functional in some way. Maybe a physical keyboard that pops out for the whiners or a changeable battery. Likely it's nothing but I like to speculate

  14. @n8r

    isn't it! They're saying they haven't caught the guys yet but itunes can get all of your information like serial number, firmware, and OS version. why can't they trace the serial number from this guy's receipt; then see who and were it's activated.

  15. @ tokz

    It's plausible that nobody has activated it yet. It's even plausible that it still sitting in the box and dude hid it once he saw the news report.

    What's MOST plausible, is that it's sitting unopened in a pawn shop right now.

  16. @n8r

    I don't see this being in a pawn shop but i can picture it being sold by those thugs. It makes me feel bad for the person who ends up buying it because they'll be associated with this tasteless crime.

  17. @N8R

    the way that device connects to a wifi network must be putting a serious drain on bandwidth. The Iphone used to be as inefficient on 3G. AT&T engineers showed the data to Apple and Apple resolved the issue. I'm guessing battery conservation would play a role in this.

    As far as the universities blocking them, I don't like it. If you pay tuition you should be able to use one. My university blocks all P2P.

  18. @ Smartguy

    P2P I can see… whether or not I agree is different and so is whether or not I'd like it… but I can see it.

    The iPad thing has to be temporary as you suggested.

  19. @n8r

    dude to anyone on the street! My friend works at a warehouse and sometimes things fall off the truck. He doesn't sell them to the pawn shops. He puts feelers out there and sells them to people.

  20. @ tokz

    The guy in the video looked like a junkie to me. Junkies are looking for the quickest sale so they can get their fix as fast as possible. That's why I think a pawn shop because most dealers are smart enough to know about stolen tech and traceability. Especially once it makes the national news.

    Some pawn shops run a tight ship… but there are still alot who don't.

    @ Smartguy

    I agree… but copyrighted content can get the university in trouble. Also, it's almost guaranteeing that artists don't get paid (does not apply to music, because record labels and managers screw us as it is).

  21. @n8r

    wouldn't that make a pawn shop owner less likely to buy it. If he's buying it from the junkie, he should know it's stolen, especially one that he's now probably saw on the news. He knows he probably wont get any money now because he wouldn't want any problems with the police or the person that buys it.

  22. @ tokz

    As I implied before… it depends on where you go.

    Something tells me that junkie thugs aren't tech savvy enough to give a damn about an iPad.

  23. @smartguy – Personally I'm really digging it. I've stopeed taking my laptop around with me which is fantastic. don't tell anyone but I've got a jailbroken iPhone so I can tether my 3G signal which is way better than the 3G solution later this month for iPad. It still doesn't do everything but I also take large jump drives around in case i need to transfer or manage miscellaneous items between work/home

    some of my favorite apps –

    AirVideo – I can watch the movies/tv shows from my home computer anywhere internet is available. love it

    WordPress – excellent for posting stuff to my blog

    iBooks – I love reading books this way, I'm not a big fan of standard books but i can read on a computer all day

    AirSharing HD – love this, It houses a my documents folder where i can put receipts, spreadsheets, pictures, and so on. Also I can edit word docs and xcel spreadsheets stored on there. I just wirelessly sync files through my work/home computer.

    abc – great player for catching up on the latest episodes of TV shows

    pages/numbers – I love being able to view and edit documents on the fly. I'd prefer office versions of these apps though, get going M$

    Desktop – I can log in to my work computer using VPN and this, works fantastically, and at home I can remotely log in to my Mac computer as well. works like a charm if I don't want to go upstairs to do something on my computer.

    @N8R – ya universities are complaining about how the iPad connects. though one of the universities said they don't even allow iPhones. I'm with smartguy in that it's crap they block certain devices, but I heard Apple is working on a fix for the iPad problems for networking

  24. @Shockwave562 The thing the stops me from getting an iPad is that I can't take or edit images on it. Automattic's WordPress app is great, but right now it's more useful on the iPhone than the iPad for me.

  25. @ray – that's certainly understandable, plus I'm sure the next iteration will be far superior. To be honest I'm the type that will just upgrade when the new one comes out anyway.

    Photos are a pain. but I guess I could take them on the phone and then email them to myself. it's an extra step for sure. there's also the connector kit for transferring images from iPhone and digital cameras to iPad. Usually when I post on the blog I just save images from safari.

    I would like to see a nice photo editing software for iPad. the iPhone versions are ok but the screen real estate on iPad would allow for a lot more power when it comes to image editing. I hope someone takes advantage of that.

  26. @tokz – no kidding, weird thing is that's the upscale shopping mall for denver. not exactly a place where you'd expect such a blatant robbery. I'll keep you guys posted on if they catch these guys since I'm local

  27. @ray – very true. one thing that's a little disheartening is that I know Apple is going to announce iphone 4 has the same exact processor. it might be tamed down for heat but still, the new phone might make the ipad a little obsolete, especially since iPad won't even get 4.0 till the fall

  28. @Shockwave562 Yes, it appears Apple will be using the A4 ni the iPhone 4, but it would probably have to be clocked down significantly — not just for heat, but for battery life.

  29. @Shockwave

    Maybe you know the answer to this then…I was messing with an iPad and specifically numbers a weekend ago and I didn't like it because I couldn't cell reference in my sheet. Is there a safe place to drag the cursor so you can cell reference in a big formula? It's a must for me.

  30. @smartguy – that's a good question, most of my excel use is pretty simple, I'm no accounting major but isn't there a formula to cell reference? I'd try putting that in. as far as a touch method I haven't found one for referencing different sheets but I know it's got to be possible.

  31. @shockwave

    Yes, I can input the individual cells in the formula bar, but half the time I can't remember which cell I need to reference especially since it cuts the sheet in half when you go to input mode.

    What I normally do is have a nested IF function and in that function I will reference other functions or arrays, and sometimes individual cells.

    I need to go back to BestBuy and mess with it some more.

  32. @smartguy – you're definitely beyond my knowledge of it. Honestly I don't think it can do everything you need it to. I think pages and excel are much better for editing than creating really. but for $10 each I'm not really complaining.

    When you play with it again check out the 'functions' tab when you're inputting cells. there might be an easy way to reference that way

  33. I just did a simple reference for our softball league stats. I clicked on the cell and went to = (for functions) and then went to my other sheet to reference that. I simply clicked on the cell I wanted to reference and it pulled in my formula Game Stats:: Table 1::E2

    bear in mind this is no complicated formula, I'm just copying a players name from one sheet to the next

  34. @shockwave

    I just read you have a jb iphone. me too. I've been wanting to see how those 3G/Wifi things work, which one are you using. Also, how does the Airvideo app work and how do you like it. Right now i use dropbox but the 2GB cap hinders me a bit.

  35. @bsukenyan

    wow! What a great article you found. Im sure that this is pretty much what happened. Somewhat.

  36. @Tokz_21

    Yeah I'm not too sure how much I really believe them on everything, but it is interesting to see how they are painting the picture from their side.

    Now I just really wanna hear the truth…but I'm sure my wishful thinking is too much to ask.

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