Channel Conflict at Apple
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
"Our strategy isn't to put our resellers out of business, but to work side by side with them."
- CEO Steve Jobs, during the launch of Apple's retail stores in May 2001.1
"We love Apple's innovative products! Our case is a matter of business ethics and simply doing the right thing!"
- Opening lines on the website started by Apple resellers to document the channel conflict.2
In May 2001, Apple opened its first retail store in a suburb of Washington D.C., and went on to open several other such stores across the US. In 2003, Tom Santos, an Apple reseller, filed a lawsuit against the company accusing it of showing unfair preference to its own retail and online stores while ignoring reseller stores during the shipment of new goods.
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