Sun, Oct 03, 2010 - Page 12 News List

Apple wouldn’t be Apple without Jobs’ ‘lost years’

By Randall Stross  /  NY Times NEWS SERVICE

The saga of Steven Jobs is so well known that it has entered the US’ mythology: He’s the prodigal who returned to Apple in 1997, righted a listing ship and built it into one of the most valuable companies in the world.

But the Jobs of the mid-1980s probably never could have made Apple what it is today if he hadn’t embarked on a torment-filled business odyssey.

Lawrence Ellison, the chief executive of Oracle, overlooks this. In August, after the ouster of Mark Hurd as the chief executive of Hewlett-Packard, Ellison said in an e-mail to the NY Times that the HP board had made “the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago.”

Actually, the Apple co-founder wasn’t fired. Jobs was relieved of operating responsibilities in a company reorganization in May 1985, but he was still the company’s chairman. Apple was ailing: Sales of the Macintosh were falling well below expectations; inventory was piling up; and the company seemed headed for its first-ever loss. In September 1985, Jobs resigned to start a new computer company he called NeXT.

Suppose Jobs had not left in 1985. Suppose he had convinced the Apple board to oust his nemesis, John Sculley, then chief executive and president. Under Jobs’ uninterrupted direction, would Apple have arrived at the pinnacle it has reached today, but 12 years earlier?

It’s hard to see how anything like that would have transpired. The Steve Jobs who returned to Apple was a much more capable leader — precisely because he had been badly banged up.

“I am convinced that he would not have been as successful after his return at Apple if he hadn’t gone through his wilderness experience at NeXT,” said Tim Bajarin, president of Creative Strategies, a technology consulting company.

Jobs began NeXT, with the intention of building a high-powered computer expressly for customers in higher education, giving students and scholars what he called “a personal mainframe.”

Advisers from universities told him that he should keep the price under US$2,000, but the price of the NeXT machine when finally unveiled in 1988 was US$6,500. When colleges and universities, not surprisingly, demurred, Jobs tried to sell to corporate customers by enlisting Businessland, then a big computer retailer, but fared no better in that market.

Jobs’ lieutenants tried to warn him away from certain disaster, but he was not receptive. In 1992 to 93, seven of nine Next vice presidents were shown the door or left on their own.

In this period, Jobs did not do much delegating. Almost every aspect of the machine — including the finish on interior screws — was his domain. The interior furnishings of Next’s offices, a stunning design showplace, were Jobs’ concern, too.

Next’s computer hardware and software were filled with innovations that drew a small, but devoted, following. Jobs had created the first easy-to-use Unix machine, but the mainstream marketplace shrugged. He had already helped bring to market an easy-to-use machine, the Mac, so the Next couldn’t differentiate itself enough — and certainly not at the price the company charged.

After selling only 50,000 computers in seven years, he finally pulled the plug on manufacturing hardware, laid off more than half his 500 employees and tried to make a go of selling Next’s software. His company would end up serving as Apple’s R&D laboratory. Apple acquired the company in 1997 and used Next’s software as the basis for the new operating system, Mac OS X.

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