Return to the Little Kingdom (50 page)

Inevitably, Apple’s progress was marred by blemishes. There were the occasional product miscues: a Macintosh housed in a clear plastic cube that developed hairline surface cracks, lame versions of the iPod introduced with Motorola and Hewlett-Packard, battery packs in laptop machines that over-heated and an occasional product, like the first version of Apple TV, that fell far short of expectations. Later a contretemps erupted over stock options, in particular, two large grants made to Steve Jobs in 2000 and 2001 and which he surrendered in 2003. These, and some more made to other executives, attracted the attention of the SEC, stirred up the whiff of impropriety and occupied the business press. But nothing came to threaten Apple as much as Steve Jobs’ health when it was disclosed in 2004 that he had been operated on for pancreatic cancer.

Rumors about Apple’s encore to the iPod had been in the air long before Steve Jobs used one of his hallmark solo shows in San Francisco in 2007 to introduce the company’s riff on hand-held computing. Though it was dubbed the iPhone, the device Jobs introduced was not a conventional cell phone or mp3 player, was far removed from a personal digital assistant and did not bear too many resemblances to a portable game device. The same day the iPhone was introduced, the word “computer” was dropped from the company’s name, which was shortened to Apple, Inc.—a sign of how far the company had traveled in the previous years.

The iPhone was a glorious expression of Apple’s approach to product design. It did not start with laborious research, focus groups or the acquisition of another company with a hot product. It began with a few people trying to design a product they would want to use and be proud to own. Like many previous products conceived under Jobs’ leadership, this required taking a close look at the short-comings of existing products, adapting ideas from others and melding them into something that, by 2007, could only have come from Apple. Such was the allure and romance of being associated with Apple that AT&T management signed up, on draconian terms, to be the exclusive U.S. distributor for the iPhone with barely a glimpse of the product. While the advertisements, commercials or press reports would frequently employ the term “revolutionary” to describe the iPhone and other Apple products, they were
evolutionary
—exquisite refinements of the half-baked ideas and products full of compromises and shortcomings that other companies had prematurely rushed onto store shelves.

The iPhone appeared simple. It fired up immediately. It was housed in a case less than 12 millimeters thick and could connect to any machine—from a supercomputer to a smoke detector—that was hooked up to the internet. But simplicity, especially elegant simplicity, is deceptively difficult. Jobs’ magisterial achievement, one that has few, if any, precedents, was to ensure that a technology company employing tens of thousands of people could make and sell millions of immensely complicated yet exquisite products that were powerful and reliable and while also containing a lightness of being. This is Apple’s triumph. It is one thing for an individual—Matisse with a line, Henry Moore with a shape, W.H. Auden with a phrase, Copland with a bar, Chanel with a cut—to express themselves. It is another matter entirely for the germ of an idea to be developed, refined, reshaped, molded, tuned, altered and rejected again and again before it is considered perfect enough to be reproduced in the millions. It is another matter too to steer, coax, nudge, prod, cajole, inspire, berate, organize and praise—on weekdays and weekends—the thousands of people all around the world required to produce something that drops into pockets and handbags, or in the case of a computer, rests on a lap or sits on a desk.

The iPhone, in some respects, came to be a throwback to the beginning of Apple and the way in which software developers all over the world had been encouraged to write programs for the Apple II. In a fashion that had not occurred since Microsoft had developed an army of software mercenaries trooping after its DOS and Windows operating systems, the iPhone ignited an explosion of interest from programmers around the world so that now tens of thousands of applications, from the life-saving to frivolous, can be bought with the tap of a finger from Apple’s AppStore.

Sales of Apple’s Macintosh computers are now outstripped by products that were not even imagined, let alone conceived, at the turn of this century. The popularity of the iPod and iPhone and the accessibility of Apple’s retail store have rejuvenated sales of Macintosh computers, which were also helped by a shift to Intel microprocessors and the constant refinement of its operating system, which has developed a reputation for being more stable and secure than Windows. The overall results are extraordinary, testament to perhaps the most creative industrial turnaround in the history of America. At the end of Jobs’ decade running Apple, an era during which the growth of the personal computer industry had slowed to a pedestrian pace, its sales had risen from $6 billion to $32.5 billion and the price of its stock had, at its peak, multiplied forty-fold.

During a period when so much was fictitious, when there were so many empires built on air and when frauds were uncloaked, Apple stands is an emblem for daring, ingenuity and enterprise. When so much was piled atop mountains of debt, it is reassuring to know that real earnings and tangible profits can be used to invest in the future. When weak companies scurry to Washington to bleat for Federal bailout money, it is a tonic to realize that nothing is more effective than the spirit of a restless company threatened with extinction. When so many mathematicians and scientists caught the scent of Wall Street and used their skills to construct futile risk models, it was delightful to know that some of their contemporaries had spurned the lure of Manhattan high-rises and, instead, had chosen to write code or program chips, without which Apple’s devices would never have materialized. When entry visas and work permits were being refused to the brightest from overseas, it was all the more meaningful to see that Apple’s engineering ranks were teeming with immigrants and first-generation Americans. When other companies had rushed new products into the market with scarcely a nod to design and finish, it was a relief to see a demonstration that aesthetics and attention to detail really make a difference. If ever there was a company that demonstrated an application of the exhortation “Yes we can,” it was the Apple of the last ten years.

As with all books about business, this has been a tale of yesterday and today. And, as with all stories of success, this has been a triumph of human will. Now lies tomorrow. No technology company has ever been able to consistently produce great consumer products for half a century. So for Apple there is the inevitable question,
what comes next?
Can it continue to produce encore performances? Will the corpus always think and act differently? At a time of fears and concerns for Steve Jobs’ health following the disclosure of his liver transplant, it’s natural to wonder who might someday succeed the man whose identity and fate is so closely tied to the company? How will Apple avoid the fate of SONY following the retirement of Akio Morita? Will Apple’s next chief possess enough of an owner’s instincts not to keep stopping in his tracks and wondering, “What would Steve do?” Finally, there is the ultimate barometer reading for any technology company—whether it can stay youthful in spirit. This means answering the most testing question of all. What will keep the scintillating twenty-three year old engineers in the world’s greatest colleges and universities yearning to hear word that they have been offered a job at the company formerly known as Apple Computer, Inc.?

Advertising

Albrecht, Robert

Alcorn, Al

All One Farm

Alpert, Richard

Altair

Alto Computer

American Telephone and Telegraph, phone phreaks and

Apple computer, first: built at Jobs’ family home; conflicts over; and contract between Jobs, Wozniak, and Wayne; efforts to find power supply for; first prices for; first reactions to ; first sale to Byte Shops of ; Holt and; introduced at Homebrew Club in 1976, ; modifications made to ; pricing of; and Wozniak’s early designs for microprocessor .
See also
Apple II; Apple IIe

Apple Computer Company: first management of; at First West Coast Computer Faire; logo for; official formation of .
See also
Apple Computer, Inc.

Apple Computer, Inc.: advertising meetings at ; Apple culture and ; Apple IIe and; arrogance of; attitude toward technical writers; beginnings of; Black Wednesday firings at; bureaucracy at ; competition and ; competition with IBM ; and completion of Macintosh; corporate culture of; dealers and ; early growth of ; early marketing strategy of; employee turnover at; fan clubs for; finances in 1977, ; financing of ,

Apple Computer, Inc. (cont’d.) ; first headquarters of; first marketing campaign of; first staff of; formation of divisions by; future of; gifts of computers to educational institutions from; hiring binge in fall of 1980, ; imitators of; impact of rapid growth on; impact of wealth on; introduction of Macintosh by; Japanese market and; Jobs’ hesitancies over forming ; Mac division weekly lunch meeting; meeting with bank managers; meeting on publicizing Mac; meetings at; moves to larger headquarters; near failure in 1977, ; new products research at; overseas sales of; personnel recruitment by; press relations of; and problems with Apple III, ; professionalization of; public relations problems of ; public stock offering by ; reasons for studying; rise to top position ; rumored merger with IBM; Sculley’s role at ; staff relations in 1977, stock distributions or options to buy of; success of; tensions between newcomers to; Terrell and; use of Pascal by; users groups and; Visicalc and ; Wayne and; work retreat for Macintosh Division; workers’ benefits at; worth of; Xerox Corporation and

Apple II personal computer; case design for; contributors to; development of; discussion on pricing of; disk drive added to; introduced at First West Coast Computer Faire; manuals for; rankings; software for

Apple III

Apple Writer

ARPANET

Artificial Intelligence Laboratory, Stanford

Atari; history of; Jobs works for

Atkinson, Bill

Auricchio, Rick

AUTOVON

Baba, Neem Karolie

Baez, Joan

BASIC, used for Wozniak’s microcomputer

Baum, Allen; builds computers with Wozniak; and Homebrew Computer Club ; lends Jobs and Wozniak money for Apple Computer, Inc. ; Wozniak and

Baum, Elmer; Apple stocks and ; hired by Apple Computer; lends Jobs and Wozniak money for Apple Computer, Inc.

Belleville, Bob

Biggs, Barton

Blue boxes

Boich, Michael

Bowers, Ann

Breakout (video game)

Bricklin, Daniel

Bruener, Don

Budge, William

Buffet, Jimmy

Burge, Frank

Bushnell, Nolan

Byte Shops

Caen, Herb

Call Computer

Cantin, Howard

Capps, Steve

Carson, Johnny

Carter, Gene

Carter, Matt

Cavett, Dick

Charlie Board, The

Chaudhari, Wasu

Chiat-Day advertising agency, and advertising for Apple Computer, Inc.

Chino, Kobin

Clark, Candi

Clow, Lee

Coleman, Debi

Commodore Business Machines

Community Memory Project

Compucolor

Computer Conversor Corporation

Computer Space (video game)

Computerland

Consumer Electronics Show

Continental Illinois Bank, Chicago

Cornfeld, Bernie

Couch, John

Cream Soda Computer

Crocker Bank

Cromemco

Crunch, Captain.
See also
Draper, John

Cummings, Burt

Dali, Paul

Data General

Davidow, William

Davis, Tommy

Dazzler

DEC LSl-11

Di Franco, Salvatore

Digital Electronics Corporation

Digital Equipment Corporation

Disk drives, Apple II and.
See also
Twiggy

Dr. Pong (video game)

Draper, John; Charlie Board and; Easywriter and; Wozniak and Jobs and

Dudman, Jack

Dylan, Bob

Easywriter (word-processing program)

Eddy, Jonathan

Ehret, Arnold

Elliot, Jay

Elzig, Hal

Engelbart, Douglas

Engressia, Joe

Espinosa, Chris ; Apple II and; on distribution of Apple stocks and options; professionalization of Apple and; on Wozniak

Faber, Ed

Family Computer, The

Felsenstein, Lee on Apple II, ; attitude toward microprocessors

Fernandez, Bill ; Apple stocks and; helps Wozniak and Baum build their first computer; hired by Jobs; relationship with Wozniak and Jobs; role at Apple Computer in 1977,

Fial, Ron

Finley, Charlie

Folkedal, Tor

Folley, Clyde

Folon, Jean-Michel

Franklin Computer Corporation

Free University of Palo Alto

French, Gordon.
See also
Homebrew Computer Club

Friedland, Robert; Jobs and

Fylstra, Daniel

Gates, William

Genentech

Ghiringelli, Paola

Gibbons, Fred

Ginsberg, Allen

Goffen, Linda

Goldberg, Fred

Goldman, Maurice

Good, Timothy