Information vacuum on Apple CEO seen fueling speculation
By Gabriel Madway
(Reuters) - Get ready for the Apple rumor machine to crank into high gear again.
Apple Inc's tight-lipped approach to disclosure is seen stoking the fires of speculation over Steve Jobs' condition -- and the fortunes of the most valuable technology company on the planet -- following news about the visionary co-founder's third medical leave of absence.
Apple revealed virtually no information about its CEO's condition in announcing on Monday his decision to step away. Jobs said only that he will take a leave of absence, "so I can focus on my health."
"I love Apple so much and hope to be back as soon as I can," said Jobs, a pancreatic cancer survivor who had a liver transplant in 2009.
"In the meantime, my family and I would deeply appreciate respect for our privacy," he said in a statement.
Even in the cloak-and-dagger world of Silicon Valley, where meetings are often preceded by the customary signing of nondisclosure agreements, Apple stands out. Renowned for its obsession with secrecy, its policy begins with Jobs and trickles all the way down to employees in its retail stores.
Investors have come to deal with Apple's penchant for mystery so long as the profits, and agenda-setting gadgets, roll in. Apple's shares have been surging for the better part of a decade, and it is now the second-largest U.S. company by market valuation.
But the information vacuum left in the wake of Jobs' decision could end up serving as an echo chamber for rumors and supposition in Silicon Valley and beyond.
The Jobs health gossip mill first cranked into overdrive in the summer of 2008, when the CEO showed up at a company event looking gaunt.
Well before Apple acknowledged the severity of Jobs' health issues, bloggers and the mainstream press remarked on his appearance. At the time, the company said he was fighting a "common bug" and later called Jobs' health a private matter.
Apple-focused message boards on Monday were buzzing with activity from the company's dedicated but worried fans, speculating about Jobs' condition and wishing him a speedy recovery, even as they wondered whether he would ever return as CEO.
Roger Kay of Endpoint Technologies argued that the health of Apple's CEO is material to investors, and said he wondered how the company had managed to placate the U.S. Securities and Exchange Commission with its previous disclosures.
"Arguably there's no CEO that's more valuable to their company than Steve Jobs. In exactly the situation when it's most material, we have no information," he said.
Corporate governance experts have said Apple is not necessarily required to disclose his medical condition. But some also have noted that Jobs' case represents something of a gray area because of his importance to the company. He is widely viewed as one of the best CEOs of modern times.
When Jobs took medical leave in 2009 the situation was somewhat different. Jobs first disclosed that he had a "hormone imbalance," then roughly a week later elected to take a six-month leave, after saying that his health issues were "more complex" than he had originally thought.
This time around, Apple did not say when Jobs would return.
"Apple is Steve and Steve is Apple," said Rodman & Renshaw analyst Ashok Kumar. "It's a fine balance, you have to respect his privacy, but clearly from an investor perspective, it's a negative."
"But for him to step away from Apple like this, it must take something of magnitude," he said.
(Reporting by Gabriel Madway; editing by Carol Bishopric)
Credit: Reuters (www.reuters.com)
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