Return to the Little Kingdom (3 page)

“There is one disaster scenario,” Murray admitted. “We could say Lisa was a great exercise for Apple. We can put it down to experience and sell ten.”

“Lisa is going to be incredibly great,” Jobs interjected firmly. “It will sell twelve thousand units in the first six months and fifty thousand in the first year.”

The marketing sorts talked of ploys to boost sales. They discussed the importance of trying to sell or donate hundreds of Macs to universities with gilded reputations.

“Why not sell Mac to secretaries?” asked Joanna Hoffman, a perky woman with a faint foreign accent.

“We don’t want companies to think the machine is a word processor,” Murray retorted.

“There’s a way to solve that problem,” Hoffman countered. “We could say to the secretaries: ‘Here’s your chance to grow into an area associate.’”

There was a discussion of improving sales overseas. “We have the kind of hi-tech magnetism that can attract the Japanese,” Hoffman mentioned. “But there’s no way they can succeed here while we’re here and we’re going to succeed there regardless.”

“We were very big in Japan until recently,” Bill Fernandez, a beanstalk-thin technician, observed in a pinched staccato.

Chris Espinosa, manager of the writers who prepared the computer’s instruction manuals, slopped in his sandals to the front of the group. He had just turned twenty-one, and as he pulled some notes from a small red backpack he announced, “You all missed a great party.”

“I heard there was free acid,” somebody piped up.

“It was for sale outside,” Espinosa chortled.

“Can we ship your party?” Jobs asked sharply.

Espinosa blanched and settled down to business. He told his colleagues that he was having difficulties hiring qualified writers, that his staff needed more Mac prototypes to work with, and that Apple’s graphics department wasn’t geared to cope with some of his demands. “We want to make books that are gorgeous,” he said, “that you read once and then keep on your shelf because they look so great.”

The work sessions were broken up by coffee breaks and by walks along the beach, some Frisbee games on the grass, a few scattered poker games, and a fuchsia sunset. Though dinner was served at long canteen tables, it bore no hint of the mess hall. Clutches of Zinfandels, Cabernets, and Chardonnays stood on every table but the breadsticks disappeared more quickly. After dinner someone who looked like a demure orthodontist, with thinning silver hair and owl-eyed spectacles, performed what, in computer circles, amounted to a cabaret act. The figure wearing a Mac T-shirt over a long-sleeved dress shirt was Ben Rosen. He had turned a reputation gained as a Wall Street electronics analyst, the industrious publisher of an informative, sprightly newsletter, and host of annual personal-computer conferences into a career as a venture capitalist. Before he started investing in computer companies his comments had been sought as much as his ear.

For the Mac group Rosen worked from a casual script of observations, wisecracks, tips, and industry gossip. He gave a brief survey of some of Apple’s competitors and dismissed Texas Instruments as “a company for the case studies of business schools,” though by way of an afterthought he added: “They are supposed to announce their IBM almost-compatible computer in three weeks.”

“What price?” Jobs asked.

“Twenty percent under the comparable price,” Rosen replied.

He talked about low-priced home computers and mentioned Commodore: “I have a few notes about Commodore that I can tell in polite company. The more you know about the company the more difficult it is to be sanguine.”

Some of the frivolous rustle disappeared when Rosen started to talk about IBM whose personal computer had been providing severe competition for Apple. “One of the fears about Apple,” Rosen noted, “is IBM’s future.” He admitted to being impressed by a recent visit to IBM’s Personal Computer Division in Boca Raton and described what he thought were its plans for three new personal computers. Then he looked around the room and said: “This is the most important part of Apple Computer. Mac is your most offensive and defensive weapon. I haven’t seen anything that compares to it.” He quizzically mentioned another industry rumor: “One of the things going around Wall Street is an IBM-Apple merger.”

“IBM already said they weren’t for sale,” Randy Wigginton, a young blond programmer, shot back.

Members of the Mac group started to ask questions. One wanted to know how Rosen thought Apple’s stock would perform. Another was eager to find out when a personal-computer software company would turn a $100 million in sales, while one with a strategic inclination wondered how Apple could ensure that computer dealers would make room on their increasingly crowded shelves for Mac.

“We have a crisis looming,” Jobs told Rosen, from the back of the room. “We’ve got to decide what to call Mac. We could call it Mac, Apple IV, Rosen I. How’s Mac strike you?”

“Throw thirty million dollars of advertising at it,” Rosen said, “and it will sound great.”

Rosen was the one interlude in a string of presentations by every manager of a department at Mac. They provided an abbreviated tour of a computer company and numbed everyone with a welter of facts. The snappy presentations were interrupted every now and again by applause at some piece of good, or unexpected, news. The engineering manager, Bob Belleville, a soft-spoken engineer who had just come to Apple from Xerox, said, “At Xerox we used to say it was important to get a little done every day; at Mac it’s important to get a lot done every day.” The main hardware engineer, Burrell Smith, blushed fiercely, said he didn’t have enough material to last ten minutes, and played his guitar. The designer of the computer case lit some candles, sat in a chair with his back to the others, and played his remarks from a cassette tape. Others told about problems meeting the standards for electronic devices set by the FCC.

The programmers relayed their progress on the software. Matt Carter, a burly man with a beleaguered look, who was responsible for part of the manufacturing, rattled through a quick course in factory layout and showed a film of what Apple’s new production line for Mac would look like. He talked about carousels and bins, automatic inserters and linear belts, prototype builds and pricing commitments. Another manufacturing man told about defect rates, improvements in output per person per day, and material handling. The last prompted Jobs to promise: “We’re going to come down real hard on our vendors. We’re going to come down on ’em like never before.” Debi Coleman, the financial controller, gave her version of Accounting 101, explaining differences between direct and indirect labor costs, inventory control, fixed-asset tracking systems, tooling analysis, inventory valuation, purchase price variance, and break-even levels.

 

At the tag end of the retreat, Jay Elliot, a tall man from Apple’s human resources department, introduced himself. “I’m a human-resources manager,” he said. “I really appreciate being here. Thank you for being here. At human resources we try to leverage top performers—”

“What does that mean in English?” Jobs snapped.

“Human resources,” Elliot stumbled, “is typically viewed as a bureaucratic, bullshit organization . . .”

Once Elliot recovered, he suggested ways of coping with the need for recruitment. The projected organization chart for the Mac Division was dotted with little boxes filled with the initials TBH. These stood for “To Be Hired.” Elliot said his department was swamped with fifteen hundred résumés a month and suggested panning recruits from the names of Apple’s owner-warranty cards.

“Nobody any good sends in their warranty card,” Jobs said. He leaned over the back of his chair and addressed Andy Hertzfeld, one of the programmers. “Andy, did you send in your warranty card?”

“The dealer filled it in,” Hertzfeld said.

“See?” said Jobs, swiveling around in his seat.

“We could put ads on ARPANET,” Hertzfeld suggested, referring to the government-funded computer network that links universities, research establishments, and military bases. “There would be legal problems with that but we could ignore them.”

“We could put ads in newspapers but the catch factor is kind of low,” volunteered Vicki Milledge who also worked in the human resources department.

“What we should do,” Jobs said, “is send Andy out to the universities, let him hang out in the labs and find the red-hot students.”

After Elliot finished, Jobs embarked on a soliloquy. He fingered a gray, glossy folder that contained a summary of progress on Mac and warned everyone to carefully guard all company documents. “One of our salespeople in Chicago,” he said, “was offered a complete sales introduction plan on Lisa from somebody at IBM. They get everywhere.” He returned to the easel and a final flip chart that carried the picture of an inverted pyramid. At the bottom a band was labeled MAC and succeeding layers carried the Words FACTORY, DEALERS, SUPPLIERS, SOFTWARE HOUSES, SALES FORCE, and CUSTOMERS. Jobs explained the triangle and pointed to the succession of bands: “We have a major opportunity to influence where Apple is going. As every day passes, the work fifty people are doing here is going to send a giant ripple through the universe. I am really impressed with the quality of our ripple.” He paused. “I know I might be a little hard to get on with, but this is the most fun thing I’ve done in my life. I’m having a blast.” A trace of a smile appeared on his face.

B
ulldozers and steam shovels lurched about the quarry, tearing tawny scars across a cheek of the hillside. The machines sent plumes of dust into the air above the southern end of San Francisco Bay. Large wooden placards declared that the equipment and quarry belonged to the Kaiser Cement Company. The earth in the dumpsters was going to form the substance of the towns that were being built on the plain that spread below the quarry. The trucks rumbled by rolls of barbed wire, coasted past signs that warned of a steep incline, tested their brakes, rolled onto a country lane, and negotiated the thin bends and chuckholes that led toward Cupertino, a village that was trying hard not to become a town. From the quarry gates, on those weekday mornings in the mid-fifties, the position of the crossroads that formed the center of Cupertino was revealed by the cylindrical shapes of some clay-colored feed and grain silos.

In the fifties the Santa Clara Valley was still predominantly rural. In places the greenery was broken by splotches of buildings. From a distance it looked as if someone had spilled small loads of garbage that had then been smeared and raked across parts of the valley floor to form a string of small towns that worked along the plain between San Jose and San Francisco: Los Gatos, Santa Clara, Sunnyvale, Mountain View, Los Altos, Palo Alto, Menlo Park, Redwood City, San Carlos, Hillsborough, Burlingame, and South San Francisco.

Most of the towns still had the manners and style of the thirties. The buildings rarely rose over two stories. The automobiles could park at raked angles on Main Street. Corners were frequently decorated with a State Farm Insurance office, a gas station, a branch of the Bank of America, and an International Harvester franchise, and in towns like Cupertino there had been, not so long before, concerted campaigns to lure a permanent dentist and doctor. The center of the world was immediate: a town hall built with terra-cotta tiles in Spanish mission style and flanked by a library, police department, fire station, courthouse, and stumpy palm trees.

But the towns were separated by all sorts of differences. Each had its own climate which grew warmer the farther away a town was from the San Francisco fog. At the southern end of the Peninsula the summer climate was positively Mediterranean and a little seminary that overlooked Cupertino could easily have been set on a quiet hillside in Tuscany. The towns had their own councils and taxes, their own ordinances and quirks, their newspapers and habits. There were mayoral elections brimming with the rumors and innuendo stirred by a community where people, if they did not know the mayor, at least knew someone who did. And the towns were, of course, separated by jealousy and snobbery.

The lawyers and doctors who built homes in the hills of Los Gatos said to themselves—with not a touch of jest—that the brains of San Jose slept in Los Gatos. The people who lived in Los Altos Hills looked down on the Los Altos folk who lived in the flatlands. Palo Alto with its gracious trees and Stanford University had an airy feel and a few electronic businesses started by former students. Towns like Woodside and Burlingame, set above the plain, had the tony touch of horses, polo games, and rigidly exclusive golf clubs. Burlingame had been home to the first country club on the West Coast. But the people who lived in nearby Hillsborough often gave their addresses as Burlingame for fear of being mistaken as parvenus. And beyond San Carlos, San Bruno, and Redwood City there was windy South San Francisco—an industrial footnote to the city itself—sited below the approach and takeoff paths to the San Francisco airport. Here was a clump of steel mills, foundries, smelters, refineries, machine shops, and lumberyards where the City Fathers had advertised their muscular temperament when they had authorized bulldozers to scrape in giant letters on the hill behind the town the slogan SOUTH SAN FRANCISCO, THE INDUSTRIAL CITY.