Reuters has posted a report profiling the secrecy Apple demands of their Asian manufacturing partners, specifically a Foxconn facility in Longhua, China where employees live and work. Inside the walled city — one of several compounds run by Foxconn International, a major supplier for Apple Inc — employees are provided with most of their daily […]
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The Secrecy at Apple's Manufacturing Partner's Facilities

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Reuters has posted a report profiling the secrecy Apple demands of their Asian manufacturing partners, specifically a Foxconn facility in Longhua, China where employees live and work.

Inside the walled city — one of several compounds run by Foxconn International, a major supplier for Apple Inc — employees are provided with most of their daily needs. There are dormitories, canteens, recreation facilities, even banks, post offices and bakeries.

The rank-and-file within the compound have little reason to venture outside. That reduces the likelihood of leaks, which in turn lessens the risk of incurring the wrath of Apple and its chief executive, Steve Jobs, whose product launches have turned into long-running, tightly controlled media spectacles.

The report claims that workers pass through metal detectors and are searched when leaving the compound, while the security personnel take their jobs too seriously. In fact, one Reuters reporter was attacked by Foxconn security while taking photos of the facility from a nearby public road. Police intervention was needed quell the situation.

“You’re free to do what you want,” the policeman explained, “But this is Foxconn and they have a special status here. Please understand.”

Apple’s manufacturing partners sign standard confidentiality agreements but Apple will also perform random security checks at the facilities to test security. Apple has even threatened to terminate contracts with some manufacturers if alleged leaks continued. There is no evidence that Apple has actually backed up this threat.

Apple uses custom parts with short lead times for parts manufacturers, which cuts the amount of time the manufactures are aware of Apple’s plans. Apple also uses several manufacturers for different components for a single device so as no one firm knows entirely about the product until only weeks before the launch when manufacturing is in full swing. Lastly, Apple occasionally tests potential manufacturing partners by contracting them to manufacture different parts and keeping an eye out for any potential leaks.

This reminds me of older reports describing Apple’s secrecy at their corporate headquarters in Cupertino, California. Both accounts suggest Apple goes to amazing distances to combat leaks and corporate espionage. To be perfectly honest, they sound paranoid.

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