By Christoph Dernbach

Steve Jobs (March 2011)

Steve Jobs' highschool photo

Steve Jobs must already have been charismatic as a twelve year old school boy. Or was it just cockiness with which he would later take his business partners by surprise time and again? As an eighth grade student, he wanted to build a frequency counter for his school project and needed some parts. He contacted non other than Bill Hewlett, who was the legendary co-founder of computer group Hewlett-Packard (HP).

In the 60s, the Silicon-Valley pioneer’s contact information could still be found in the phone book. The lanky boy did not just coax the needed parts free of charge from the group boss. “He answered and chatted with me for twenty minutes. He got me the parts, but he also got me a job in the plant where they made frequency counters,” Jobs told book author Walter Isaacson for his biography.

Steve Jobs worked there the summer after his freshman year at Homestead High. obs worked there the summer after his freshman year at Homestead High. “My dad would drive me in the morning and pick me up in the evening.” He found himself at the right place at the right time. Still, Steve Jobs’ fate as the most successful entrepreneur of America was not handed to him at birth.

“He was a boy who had no money,” recalls his friend and Apple co-founder Steve Wozniak. “He had nothing except his intellect. But he brought us things that became a challenge for all of us.” Paul Otellini, CEO of chip giant Intel, said: “True genius is measured by the ability to touch every person on the planet. Steve did that, not just once, but many, many times over his amazing life.” In contrast to industry titans like Bill Gates, Steve Jobs came not from a wealthy home, but from a lower-class background.

Steve Jobs with his father Paul Jobs (1958)

His biological parents, the Syrian student Abdulfattah John Jandali and his American girlfriend Joanne Simpson, gave him up for adoption after his birth. In 1955, the still unmarried couple, both 23, was studying at the University of Wisconsin and found themselves unable to care for the child without a proper income. Actually, his parents insisted on giving him away to an academic family, which could guarantee that he could one day attend university. But the desired family got cold feet and cancelled the adoption in the last minute.

Finally, the child ended up in the house of Paul and Clara Jobs. Steve’s adoptive parents were simple people. His father worked as a car mechanic and his mother as an office employee. When Steve was five years old, his parents moved with him from San Francisco to Mountain View, in the middle of booming Silicon Valley. Author Walter Isaacson relates in his biography of Steve Jobs that in the new neighborhood Jobs told a girl that he was an adopted child. “So does that mean your real parents didn’t want you?” the girl asked. “Lightning bolts went off in my head,” according to Jobs. “I remember running into the house, crying. And my parents said, ‘No, you have to understand. We specifically picked you out.” This key scene described the tension between the terms “abandoned”, “chosen”, and “special” at a very early age for Steve Jobs.

Steve gets it

Who knows where Steve Jobs’ journey through life would have brought him if he had not met electronics enthusiast Steve Wozniak, who was four classes above him in school. Despite the age difference, the two Steves got along very well. “It seemed as if we had a lot in common,” recalled Woz later in his autobiography. “Typically, it was really hard for me to explain to people the kind of design stuff worked on, but Steve got it right away. And I liked him. He was kind of skinny and wiry and full of energy.”

Steve Jobs (circled) at Homestead High School Electronics Club (1969)

Jobs, like Wozniak before him, attended Homestead High School in Cupertino, California, a solidly middle-class school in the suburbs of Silicon Valley. Homestead was progressive, with an innovative electronics program that shaped Wozniak’s life. Jobs and Wozniak had been friends for some time. They met in 1971 when their mutual friend, Bill Fernandez, introduced then 21-year-old Wozniak to 16-year-old Jobs. After hours, the two Steves would often meet at Hewlett-Packard lectures in Palo Alto.

As a teenager, Jobs and his older friend “Woz” cavorted in the “phone-phreaking” scene. Hackers such as “Captain Crunch” found out how one could manipulate the systems of telecommunications giant AT&T in order to make free calls with the help of a plastic whistle from a cornflakes package. Both Steves were electrified.

Wozniak and Jobs Blue Box (1972)

Woz constructed a crammed box from inexpensive electronic parts and a small speaker, which enabled them to produce tone sequences in a more precise and delicate way than with the toy whistle. “There used to be a way to fool the entire telephone system – they were thinking you were a telephone-computer,” recalled Steve Jobs later. “You could call anyone in the world for free. In matter of fact, you could call from a pay phone, go to White Plains, New York, take a satellite to Europe, take a cable to Turkey, come back to Los Angeles. You could go around the world – three, four times and call the pay phone next door. If you shouted into the phone, about 30 seconds later it came out the other end of the other phone.”

The manipulation of the telephone system was of course illegal. That did not stop Woz and Jobs from building and selling blue boxes within their circle of friends. “It was the magic of the fact, that two teenagers could build this box for a hundred dollars worth of parts and control hundred of billions of dollars of infrastructure in the entire telephone network of the whole world from Los Altos and Cupertino, California. That was magical,” said Jobs.

His friend “Woz” had even mor fun:

So we’re sitting in the payphone trying to make a blue box call. And the operator comes back on the line. And we’re all scared and we’d try it again. … And she comes back on the line; we’re all scared so we put in money. And then a cop car pulls up. And Steve was shaking, you know, and he got the blue box back into my pocket. I got it– he got it to me because the cop turned to look in the bushes for drugs or something, you know? So I put the box in my pocket. The cop pats me down and says, “What’s this?” I said, “It’s an electronic music synthesizer.” Wasn’t too musical. Second cop says, “What’s the orange button for?” “It’s for calibration,” says Steve.
— Steve Wozniak, lecture at Computer History Museum, 2002

With the “Blue Box” episode the business savvy of Steve Jobs began to sparkle for the first time. While Woz wanted to impress especially his geek pals, for his younger friend it was also about earning money and understanding that one can win big bets with small investment.

“Experiences like that taught us the power of ideas, the power of understanding that you could build this box, you could control hundreds of millions dollars worth of telephone infrastructure around the world. This is a powerful thing,” Jobs told many years later to Santa Clara Valley Historical Association.

If it hadn’t been for the Blue Boxes, there would have been no Apple. I’m 100% sure of that. Woz and I learned how to work together, and we gained the confidence that we could solve technical problems and actually put something into production.

In 1972 Jobs wanted to study at Reed College in the neighboring state of Oregon, although it was clear that his parents could not afford the university fees. “All savings of my working-class parents went for my college fees,” recalled Steve Jobs in June 2005 during his legendary commencement address at Stanford University.” After six months, I couldn’t see the value in it. I had no idea what I wanted to do with my life and no idea how college was going to help me figure it out.”

Search for the meaning of life

Jobs broke off his studies and made his way as a person making the best of things. Now and then he would get a hot meal at the local Hare Krishna temple. He sneaked into the calligraphy course, which was offered at Reed College. ” I learned about serif and I learned about serif and sans serif typefaces, about varying the amount of space between different letter combinations, about what makes great typography great. It was beautiful, historical, artistically subtle in a way that science can’t capture, and I found it fascinating.” This episode as well would later influence computer history:

Ten years later, when we were designing the first Macintosh computer, it all came back to me. And we designed it all into the Mac. It was the first computer with beautiful typography. If I had never dropped in on that single course in college, the Mac would have never had multiple typefaces or proportionally spaced fonts. And since Windows just copied the Mac, it’s likely that no personal computer would have them.

Steve Jobs was looking for the meaning of life. He experimented with mind-expanding drugs. At the time when he worked for Atari in 1975, he profited from a business trip to Europe to go to India on his own. At that time, Jobs was studying extensively the teachings of the Harvard professor Richard Alpert, who had converted to Hinduism and taught in India as Guru Ram Dass (“servant of God”). In India, however, Jobs found no enlightenment, but ended up with a scammer who was just playing the role of a guru. Disillusioned, he returned to California.

The Homebrew Computer Club newsletter

Meanwhile, his friend Steve Wozniak tried to impress a “strange, geeky group of people” who called themselves “Homebrew Computer Club.” “This was a group fascinated with technology and the things it could do. Most of these people were young, a few were old, we all looked like engineers; no on was actually good looking. Ha. Well, we’re talking about engineers, remember?”, Wozniak wrote in his book “iWoz”. Steve Wozniak developed a kit for the geeks from the club that would later be known as the Apple I. At that time, Steve Jobs was forging much bigger plans, as he had observed that very few people from Homebrew had the time or skills to build computers on their own. “Why don’t we build and then sell the printed circuit boards to them?”, he asked Woz. (iWoz, Page 172)

Homebrew Computer Club meeting (1978)

With a sense of humor, Jobs and Wozniak founded Apple Computer on “April Fools Day”, the 1st of April, 1976. For the necessary initial investment of $1,000 Wozniak sold his programmable HP 65 calculator for $500. “The guy who bought it only paid the half, though, and never paid the rest”, wrote Steve Woziak in his book “iWoz”. “I didn’t feel to bad because I knew HP’s next generation calculator, the HP 67, was coming out in a month and would cost me only $370 with the employee discount. And Steve sold his VW van for another few hundred dollars. He figured he could ride around on his bicycle if he had to. That was it. We were in business.”

Steve Jobs and Steve Wozniak using Apple 1 computer system, ca. 1976

The third founder, Ron Wayne, who was an adult with experience, was to provide a proper accounting. He received a 10 percent share of the company, while the two Steves had their shares of 45 percent each. But Wayne dropped out after a few weeks, because the family man was not comfortable with the unclear liability risk as he had much more to lose than the two Steves.

Later on, the millionaire Mike Markkula took over the role of the adult supervisor. He invested a quarter million dollars in the start-up to finance the production and marketing of the Apple II.

Steve and I get a lot of credit, but Mike Markkula was probably more responsible for our early success, and you never hear about him.

— Steve Wozniak, Failure Magazine, July 2000

Breakthrough with Apple II

Steve Wozniak was the hardware genius. The driving force of the marketing was Woz’s dynamic companion, Steve Jobs. He was fascinated by Woz’s technical skills, partly because he would never have been able to construct a computer like the Apple II himself. But he viewed his friend also with a critical eye: “Woz is very bright in some areas, but he’s almost like a savant, since he was so stunted when it came to dealing with people he didn’t know,” said Jobs and conceded in his biographer Isaacson’s account: “We were a good pair.” Wozniak was however impressed with the business sense of his friend: “I never wanted to deal with people and step on toes, but Steve could call up people he didn’t know and make them do things,” said Wozniak. “He could be rough on people he didn’t think were smart, but he never treated me rudely, even in later years when maybe I couldn’t answer a question as well as he wanted.”

Woz would have been happy to market the Apple II as a kit. But Jobs demanded a complete product in a smooth bright plastic body, similar to a Cuisinart food processor. Jobs also asked for an expensive switching power supply, which made a fan unnecessary, He bothered Wozinak by demanding that the lines on the board of the Apple II should run straight. The huge effort paid off: The Apple II developed by Woz was the first personal computer, which found a mass audience.

The sales success has been driven by VisiCalc, the first spreadsheet software for a microcomputer. “From 1,000 units a month we went to 10,000 a month,” remembers Woz. “Good god, it happened so. Through 1978 and 1979, we just got more and more successful. In 1980, we were the first company to sell one million computers.” (iWoz, page 220)

A screenshot of Visicalc

On 12 December 1980, Apple Computer Inc. went public. With Apple going public, Steve Jobs became a multi-millionaire as the company was now valued at $1.8 billion. Forgotten were the difficult times in which Jobs had taken advantage of his friend Woz and denied him the fair share of the royalties for a programming job for Atari.

Jobs now had 7.5 million Apple shares worth 217 million dollars. Woz could also forget all economic problems as he received four million shares (116 million dollars). Markkula’s cut of seven million shares were worth $203 million. “I was worth about over a million dollars when I was twenty-three and over ten million dollars when I was twenty-four, and over a hundred million dollars when I was twenty-five,” Jobs said in an interview in 1995. “It wasn’t that important because I never did it for the money.”

Steve Jobs celebrating Apple's IPO (1980)

Going public had bitter consequences as well for Steve Jobs. Unlike Microsoft founder Bill Gates, the co-founder of Apple was no longer the leading decision-maker in “his” company. On the one hand he had an enormous amount of money, but on the other hand he no longer held the majority of company shares. Now Apple was lead by a management defined by investors. At that time, the main character of the top management of Apple was the “angel investor” Mike Markkula, who took over the job of managing director from Mike Scott in the summer of 1981. However Markkula and Jobs agreed, that the new Apple management director should be a charismatic figure who was familiar with the methods of modern marketing in the field of consumer goods and could apply it to Apple. Jobs and Markkula’s search paid off. On the east coast of the United States they found someone at the management level of Coca-Cola’s rival PepsiCo.

Dynamic Duo

Apple's Dynamic Duo (1984)

“Do you want to sell sugared water for the rest of your life or do you want to come with me and change the world?” With this famous sentence Steve Jobs convinced the Pepsi manager John Sculley in 1983 to enter the computer industry and move to California. But the “Dynamic Duo” did not last long. It quickly became obvious that the Apple co-founder Jobs and the new manager Sculley did not come to an agreement in key issues such as the marketing strategy for the Macintosh. It began in the time before Apple went public: In 1979, Markkula and Scott had hired the talented engineer Jef Raskin to construct a “people’s computer.”

The new model should reduce the company’s dependence on mega-seller Apple II. However the project progressed very slowly, partly because Steve Wozniak did not play an active role in its development anymore. After a plane crash with his Beechcraft Bonanza in February 1981, Woz had largely withdrawn from Apple. Therefore, it was Steve Jobs who at this stage provided strategic directions in Apple’s technology. He was neither an inventor, nor an engineer or programmer. But Jobs was able to estimate the implications of new technology concepts much better then anyone else.

The Enlightenment in Xerox PARC

Steve Jobs’ masterpiece in technology scouting took off during the event of Xerox PARC. As early as 1979 he had visited with a small team of Apple developers the legendary California research center in nearby Palo Alto. He had the chance to look into the future. “They showed me really three things,” Jobs said in 1995 in a TV interview. “But I was so blinded by the first one I didn’t even really see the other two. One of the things they showed me was object orienting programming they showed me that but I didn’t even see that. The other one they showed me was a networked computer system…they had over a hundred Alto computers all networked using email etc., etc., I didn’t even see that. I was so blinded by the first thing they showed me which was the graphical user interface. I thought it was the best thing I’d ever seen in my life, ” Jobs said in an TV interview in 1995.

At Xerox PARC Steve Jobs had seen the light. Now, he also wanted to build an Apple computer that was easy to operate. Apple had bought admission to the Xerox Research Center PARC through a stock deal that appeared to be very lucrative to the narrow-minded Xerox managers on the East Coast. Xerox was allowed to buy 100,000 shares of the Apple start-up company stock before the public offering for a million dollars. In the short term, this deal was worth it: By the time Apple went public a year later, Xerox’s $1 million worth of shares were already worth $17.6 million. But in the long term, Xerox lost the chance to become an industry giant like Microsoft or IBM because the work of their researchers in California had been ignored internally.

Larry Tesler, who was then a Xerox employee at the presentation of the GUI to the colorful Apple group, was fascinated by the visitors who looked like hippies, “After an hour looking at demos they understood our technology, and what it meant more than any Xerox executive understood after years of showing it to them.” Steve Jobs took a similar view: “Remember, it was very flawed, what we saw was incomplete, they’d done a bunch of things wrong. But we didn’t know that at the time but still though they had the germ of the idea was there and they’d done it very well. Within ten minutes it was obvious to me that all computers would work like this some day.” He was right. Ten years later, when it dawned on the Xerox managers that they had served the intellectual property of their researchers at PARC to Apple on a silver plate for such a small sum of money, they went to court. In December 1989, Xerox sued Apple Computer and demanded $150 million in damages. The case never went to court as potential claims from Xerox were now time-barred. In 1983 Apple made the first attempt to introduce the graphical user interface to the mass market by launching the model Lisa. In ads the new computer was promoted with remarkable software such as “Maserati for your brain”. However, it never came to be a financial success. The price of $10,000 was far too high to convince the many prospective buyers to purchase the computer.

Pirates of Macintosh

Steve Jobs was quick to distance himself from the failure of the Apple Lisa, since in 1980 the then managing director Mike Scott denied him the management of the Lisa team. In an internal competition with the Lisa team, Jobs subsequently acquired the fledgling Macintosh project from Jef Raskin and bet $5,000 that he would bring the Mac to the market before Lisa. Initially, Jobs hounded Raskin out of the group. Then he positioned his team within Apple as rebel troop. They wanted to prove the Lisa team, which enjoyed the confidence of the management, that they could do it.

The pirate flog on building Bandley III

Above the building of the Mac developers “Bandley III”, a skull and crossbones flag fluttered. “It is better to be a pirate than to go to the Navy,” Jobs said to his developers. Apple investor Arthur Rock became really agitated by this action, “Flying that flag was really stupid. It was telling the rest of the company they were no good.” But Jobs loved it, and he made sure it waved proudly all the way through to the completion of the Mac project. “We were the renegades, and we wanted people to know it,” he recalled. (Isaacson, page 186)

Jobs had assembled a dream team of genius programmers and engineers, whom he urged like a cult leader with flattery and verbal attacks to continually new heights. But the ever-changing demands of Jobs delayed the Mac project, so that the Apple co-founder finally lost his bet against the Lisa team. It was not until the 24th of January 1984, that the Mac was finally ready.

At the public presentation of the new computer model, Jobs recited the song “The Times They Are A-Changin” by Bob Dylan:

Come writers and critics

Who prophesize with your pen

And keep your eyes wide

The chance won’t come again

And don’t speak too soon

For the wheel’s still in spin

And there’s no tellin’ who

That it’s namin’

For the loser now

Will be later to win

For the times they are a-changin’

At this performance, it played a minor role that the launch party of the Mac was officially a shareholder meeting. The 29-year-old entrepreneur was able to take the liberty of doing so. His concept of the enemy was IBM. The East Coast group wanted to conquer the personal computer market by launching the IBM-PC personal computer, which was first developed by companies such as Atari, Commodore, and of course Apple. The Apple co-founder compared IBM to “Big Brother” from George Orwell’s novel “1984”, who by all means wanted to retain his former dominance of the mainframe era in the initially fully underestimated age of the personal computer.

In their most famous television commercials of all time, director Ridley Scott evoked this vision of enslaved IBM users who would be released through the Mac. The Mac would make clear in the clip, why Big Brother IBM would not dominate the world; why “1984 would not be 1984″. Jobs was visibly proud of the achievements they made, and attributes this to his broadly talented employees. “I think part of what made the Macintosh great was that the people working on it were musicians and poets and artists and zoologists and historians who also happened to be the best computer scientists in the world,” Jobs said in a 1995 documentary on the U.S. television network PBS.

Difficult start for the Mac

With the Macintosh, Steve Jobs had set a new milestone in computer development. But Apple had to first overcome a long dry spell in order to make a commercial breakthrough. This was also due to the fact that the first Mac model was only equipped with 128 kilobytes of main memory which was far too little. At that time, Apple Fellow Alan Kay described the Mac as a “Honda with a one-gallon gas tank.”

Furthermore, applications such as Aldus Pagemaker or peripheral devices such as laser printers, which could use the advantages of Mac GUI in desktop publishing, did not exist yet.

“The original 128K Mac had too many problems to list,” wrote Jack Schofield from the Guardian 20 years later in an article about the 20th anniversary of the apple Macintosh. “It had too little software, you couldn’t expand it (no hard drive, no SCSI port, no ADB port, no expansion slots), it was horribly underpowered and absurdly overpriced. The way MacWrite and MacPaint worked together was brilliant, but producing anything more than a short essay was a huge struggle. Just copying a floppy was a nightmare.”

In the fall of 1984, Apple CEO John Sculley accused Jobs of ignoring Mac sales problems, which also had technical causes. Poor features of the first Mac model caused it to be slow. In addition, users had to constantly change between the system and program disks, because the Mac did not have a second floppy drive or hard disk. “I had given greater power than he had ever had and I created a monster,” Sculley later wrote in his book “Odyssey.” In April 1985 the conflict escalated.

In a two-day marathon meeting, Sculley demanded that Jobs should give up his position as Apple vice president and general manager of the Macintosh team. Sculley wanted Steve Jobs to become Apple’s new chairman and represent the company on the outside, without having influence on the core business. When Jobs got wind of Sculley’s plan to disempower him, he attempted to organize a coup in the Apple board. Sculley defended himself and told the board: “I said look, it’s Steve’s company, I was brought in here to help you know, if you want him to run it that’s fine with me but you know we’ve at least got to decide what we’re going to do and everyone has got to get behind it.” The majority of the board stood behind the former Pepsi manager and turned away from Steve Jobs.

Jobs loses the showdown

In the end of May 1985, Job lost his responsibilities and was demoted to the post of the chairman. In September 1985, the Apple co-founder, left with a handful of people in order to found NeXT Computer. Jobs “I’m only 30 years old and I want to have the chance to continue creating things.” Jobs wrote in his farewell to Mike Markkula:

Dear Mike,

This morning’s papers carried suggestions that Apple is considering removing me as Chairman. I don’t know the source of these reports, but they are both misleading to the public and unfair to me.

You will recall that at last Thursday’s board meeting I stated that I had decided to start a new venture, and tendered my resignation as Chairman.

The board declined to accept my resignation and asked me to defer it for a week. I agreed to do so in light of the encouragement the Board offered with regard to the proposed new venture and the indications that Apple would invest in it. On Friday, after I told John Sculley who would be joining me, he confirmed Apple’s willingness to discuss areas of possible collaboration between Apple and my new venture.

Subsequently the Company appears to be adopting a hostile posture toward me and the new venture. Accordingly, I must insist upon the immediate acceptance of resignation. I would hope that in any statement it feels it must issue, the Company will make it clear the decision to resign as Chairman was mine.

I find myself both saddened and perplexed by the management’s conduct in this matter which seems to me contrary to Apple’s best interests. Those interests remain a matter of deep concern to me, both because of my past association with Apple and the substantial investment I retain in it.

I continue to hope that calmer voices within the Company may yet be heard. Some Company representatives have said they fear I will use proprietary Apple technology in my new venture. There is no basis for any such concern. If that concern is the real source of Apple’s hostility to the venture, I can allay it. As you know, the company’s recent reorganization left me with no work to do and no access even to regular management reports. I am but 30 and want still to contribute and achieve.

After what we have accomplished together, I would wish our parting to be both amicable and dignified.

Yours sincerely,

Steven P. Jobs

The reactions of the Apple employees on the de facto sacking of Jobs revealed both sides of him. Andy Hertzfeld, one of the founders of Macintosh, mourned Jobs although he as well had been driven by his crude methods. “Apple never recovered from losing Steve. Steve was the heart and soul and driving force. It would be quite a different place today. They lost their soul.,” said the software developer, who left Apple after Job’s departure and recently grabbed the headlines by designing Google+.

Larry Tesler, who came to Apple from Xerox also openly brought up the dark side of the co-founder: “People in the company had very mixed feelings about it. Everyone had been terrorized by Steve Jobs at some point or another and so there was a certain relief that the terrorist had gone but on the other hand I think there was an incredible respect for Steve Jobs by the very same people and we were all very worried – what would happen to this company without the visionary, without the founder without the charisma… ”

In 1985 Jobs sold all but one of his Apple shares, and had around 70 million dollars on his account. By chance he became aware of the sale of the animation department of George Lucas. The Star Wars director had divorced his wife in 1983 and was broke. At least Lucas could no longer afford to put millions of dollars into the innovative but economically not very successful “Graphics Group” of Lucasfilm year after year.

Jobs bought the department from Lucas for five million dollars and invested another five million more into the company, which was now named Pixar. While developing the Macintosh, Jobs had taken care of even the smallest detail, and his unwillingness to compromise had repeatedly gotten on the nerves of his employees. At Pixar, however, he gave much freedom to his management department. But initially this freedom did not pay off. Sales of the core product, the Pixar Image Computer used for the animation of film sequences, were slow. But the short films of genius Pixar employee, John Lasseter, received one award after the other, even though th film strips were only meant to demonstrate the performance of Pixar’s hardware. For that reason, in the early nineties Pixar focused on the movies themselves and no longer on the hardware.

Becoming a billionaire with ”Toy Story”

The breakthrough was made by Lasseter’s team with the computer-animated cartoon “Toy Story”, which Pixar got produced for Disney. With a production budget of $30 million, the cartoon brought over 360 million dollars at the box office and in the secondary market. On 29th of November 1995, shortly after the release of “Toy Story”, Pixar went public.

Steve Jobs, who had by now nearly exhausted his fortune from the first Apple era through ongoing donations to NeXT and Pixar, became a billionaire. “The magic of Steve was that while others simply accepted the status quo, he saw the true potential in everything he touched and never compromised on that vision,” said George Lucas after the death of Jobs.

Jobs’ new computer company NeXT had a very different structure than Pixar, as it was fully focused on the boss. Here Jobs wanted to create a computer he was not allowed to build at Apple. When the cash reserves ran low and still no product was in sight, he coaxed 20 million dollars out of multi-millionaire Ross Perot to build a modern factory for the production of NeXT. He commissioned the legendary designer Paul Rand, who had previously designed the IBM logo, to design a NeXT logo, and the German designer Hartmut Esslinger created the legendaryblack cube housing. Steve Jobs took care of details that could hardly be communicated to his employees.

Tim Berners-Lee's NeXT cube at CERN

For example, he demanded that the screws for the computer got an expensive coating and that the matt black paint was applied on the inside of the body as well, although the user would never get to see this. “He was not familiar with compromise,” said Esslinger. Anyone who tried a NeXT cube was usually enthusiastic about it. But the price of $6,500 for the NeXT cube was still too much for most of the potential clients. There was also at that time very little software available for this powerful workstation, so that a total of only about 50,000 systems were sold. Therefore, similar to the first Macintosh, Jobs found only few buyers for his expensive hardware. Nevertheless, among the European users of NeXT was the British scientist Tim Berners-Lee, who developed the concept of the World Wide Web and the first browser on a black NeXT cube at the CERN Research Center in Geneva.

During this time, Archibald Horlitz, head of Germany’s largest Apple retailer Gravis, met Steve Jobs. Horlitz had heard about the new project and during a trip to California spontaneously knocked on the door of NeXT, in order to have the system demonstrated by the head of the company himself. “Steve Jobs had several facets. If he wanted something, he could be one of the most charming people in the world,” recalls Horlitz. “I’ve heard from a colleague at NeXT, how typical interviews were carried out. He took the people literally into his arms and went with them for one or two hours around the Stanford campus.

“When they came back, they were enlightened and could imagine nothing better than to work for him.” In this way Jobs could retain a great number of big talents such as Avie Tevanian or Scott Forstall. But there was no sign of NeXT’s economic recovery. The company burned through an alarming amount of money and Jobs financial reserves (before Pixar’s initial public offering) were slowly running out. In 1993 he put on the emergency brake at NeXT, fired many employees, and stopped the hardware production. From that moment on, NeXT focused solely on the software development. And, it sounds like a staircase wit of history: Through this strategic decision, Steve Jobs came back into the game at his first company Apple.

NeXT saves Apple

In the mid-nineties, Apple was in the worst possible condition. In the late eighties and early nineties, John Sculley had indeed been successful in the publishing industry. Products such as the PowerBook family boosted sales for some time, but with the Macintosh, Apple never managed to approach the sales figures of Microsoft, the manufacturer of IBM-compatible PCs with the DOS operating system. When the Mac was launched in 1984, Bill Gates had publicly praised Apple computers as an innovative PC platform.

But behind the back of Steve Jobs, the founder of Microsoft went about stealing the ideas of Macintosh for his Windows system. Jobs got wind of it and put Gates angrily to task: “You’re ripping us off!” he shouted. “I trusted you, and now you’re stealing from us!” The Microsoft boss just sat there coolly, looking Steve in the eye, before hurling back, in his squeaky voice. “Well, Steve, I think there’s more than one way of looking at it. I think it’s more like we both had this rich neighbor named Xerox and I broke into his house to steal the TV set and found out that you had already stolen it.”

After the departure of Jobs, even Sculley was not able to prevent Microsoft from constantly developing the Windows system and step by step adopting details from the Mac’s graphical user interface in to their software. Apple was vulnerable to blackmail, as Microsoft made important applications for the Mac. After Bill Gates had threatened to discontinue the development of Microsoft Office for Mac if Apple acted against Windows, Apple’s CEO licensed certain elements of the Mac GUI to the competitor from Redmond in 1986. Sculley had to look on helplessly as the Microsoft Company shamelessly shifted agreement limits in their favor with each new version of Windows.

Even Apple’s lawsuit in 1988 could not stop the software giant. In 1992, the court ruled that Apple could not claim any copyright on the graphical user interface or protect the idea of the virtual desktop as a patent. Apple ultimately failed in stopping Windows from copying at the US Supreme Court in 1994. Declining revenues and increased difficulties in the development department of aggravated the sense of crisis at Apple. In June 1993, the management board of Apple lost patience.

Around this time Steve Jobs was asked in an oral history interview about the shape of Apple. Jobs didn’t blame Microsoft for the crisis but only John Sculley and his team:

When I left Apple it was a two billion dollar company. We were Fortune 300 and something. We were 350. When the Mac was introduced we were a billion dollar corporation; so Apple grew from nothing to two billion dollars while I was there. That’s a pretty high growth rate. It grew five times since I left basically on the back of the Macintosh. I think what’s happened since I left in terms of growth rate has been trivial compared with what it was like when I was there. What ruined Apple wasn’t growth. What ruined Apple was values. John Sculley ruined Apple and he ruined it by bringing a set of values to the top of Apple which were corrupt and corrupted some of the top people who were there, drove out some of the ones who were not corruptible, and brought in more corrupt ones and paid themselves collectively tens of millions of dollars and cared more about their own glory and wealth than they did about what built Apple in the first place–which was making great computers for people to use.
They didn’t care about that anymore. They didn’t have a clue about how to do it and they didn’t take any time to find out because that’s not what they cared about. They cared about making a lot of money so they had this wonderful thing that a lot of brilliant people made called the Macintosh and they got very greedy and instead of following the original trajectory of the original vision–which was to make this thing an appliance, to get this out there to as many people as possible–they went for profits and they made outlandish profits for about four years. Apple was one of the most profitable companies in America for about four years.

What that cost them was the future. What they should have been doing was making reasonable profits and going for market share, which was what we always tried to do. Macintosh would have had a thirty- three percent market share right now, maybe even higher, maybe it would have even been Microsoft but we’ll never know. Now its got a single digit market share and falling. There’s no way to ever get that moment in time back. The Macintosh will die in another few years and its really sad. The problem is this: no one at Apple has a clue as to how to create the next Macintosh because no one running any part of Apple was there when the Macintosh was made–or any other product at Apple. They’ve just been living off that one thing now for over a decade and the last attempt was the Newton and you know what happened to that. It’s kind of tragic, but as unemotionally as I can be, that’s what’s happening. Unless somebody pulls a rabbit out of a hat, companies tend to have long glide slopes because of the installed bases. But Apple is just gliding down this slope and they’re loosing market share every year. Things start to spiral down once you get under a certain threshold. And when developers no longer write applications for your computer, that’s when it really starts to fall apart.

"The Diesel" - Michael Spindler

BeOS finally lost the race. In February 1997, Apple paid just under 430 million dollars for NeXT and the know-how of the company. Bill Gates only had to spare scorn and ridicule for the change in direction at Apple. “Do you really think Steve Jobs has anything there?” Gates asked the still reigning Apple CEO Amelio. “I know his technology, it’s nothing but a warmed-over UNIX, and you’ll never be able to make it work on your machines.” (…) “What the hell are you buying that garbage for?” Gates did not take NextStep for a serious rival. He suspected already that it was not just about a new operating system, but a coup that would bring Steve Jobs back in charge at Apple. Five months later, Amelio was actually fired from the board of directors. And in September 1997, Jobs took over the post of an interim CEO. At that time, Apple was about 90 days away from bankruptcy.

Help from the archenemy

"Bill, thank you" - Steve Jobs on the cover of Time Magazine

The change induced by Steve Jobs had radical impacts. He brutally cleaned up the Apple management, dramatically reduced the product range, killed John Sculley’s ambitious Newton project, cancelled the agreements with producers of Macintosh clones, and brought non other than his adversary Bill Gates as savior on board. At the 1997 MacWorld Expo in Boston, the Microsoft CEO proclaimed on a giant video screen that the world’s largest software maker would buy Apple shares worth 150 million dollars, and would continue to develop the Office suite for the Mac.

The Apple fan community was shocked and there were loud choruses of boos against Jobs and Gates, but Jobs remained on his course: “If we want to move forward and see Apple healthy again, we have to let go of a few things here,” Jobs told the audience. “We have to let go of this notion that for Apple to win, Microsoft has to lose.” . . . I think if we want Microsoft Office on the Mac, we better treat the company that puts it out with a little bit of gratitude.”

After he regained power at Apple Jobs then fired those whom he considered as losers and rip-off artists who had brought the company to the edge of bankruptcy. However, not everyone suffered from the rage of the iCEO: “Apple was about 90 days away from going bankrupt – back then in the early days,” the Apple CEO said 13 years later in retrospect at the conference D8 AllThingsD.

It was much worse than I thought when I went back initially. But there were people there who — I expected all the good people would’ve left. I found these miraculous people, this great people. And I said: ‘What? – I tried to ask this as tactful as possible – Why are you still here? And you know, a lot of them had this phrase: They said, because I bleed in colors – which was the old six color apple logo.

The young designer Jony Ive was one of these frustrated and undiscovered geniuses of Apple at that time. “He was sick of the company’s focus on profit maximization rather than product design,” writes Walter Isaacson in Steve Jobs’ official biography. The Briton, who was then 30-years old, said: “I remember very clearly Steve announcing that our goal is not just to make money but to make great products.” Ive worked at Apple since 1992, but had been fully ignored by the Apple bosses Sculley, Spindler, and Amelio.

Less is more

Ive brought to Apple the ideas of the German industrial designer Dieter Rams, who had developed key stylistic elements while working for the electric equipment manufacturer Braun. “Less is more” – Rams’ policy became then the design credo of Jony Ive and Steve Jobs. With the first iMac G3, Ive converted the typical beige PC box into a semitransparent, candy-like design-statement. With the PowerBook made of Titanium and Aluminum, Ive paid homage to his role model Dieter Rams, who had designed a similar-looking aluminum case for the legendary World Receiver T1000 as early as in 1963. In 2007, the first iPhone was created, and the calculator app on the first iPhone was nothing else than a copy of the ET44 calculator body, which Rams had designed for Braun 20 years ago.

Apple borrowed from the Braun design

1998, Steve Jobs summarized the spiritual foundation of Apple’s new design basic law as follows: “Simplicity is the ultimate sophistication,” Jobs had aimed for the simplicity that comes from conquering complexities, not ignoring them. “It takes a lot of hard work,” he said, “to make something simple, to truly understand the underlying challenges and come up with elegant solutions.” (Isaacson, Page 387) For Jobs it was not about cheap fashion effects. “Fashion is what seems beautiful now but looks ugly later,” Jobs said to his biological sister Mona. “Art can be ugly at first but it becomes beautiful later.” Now Apple computers were not only physically different, but the software of the Mac now had a new foundation as well.

In September 2000 Apple released the first public beta version of the new operating system Mac OS X, which was based on the NeXTStep software. The Apple designers put the new Aqua user interface over the UNIX core. This user interface was inspired by the design of the iMac G3 and was characterized by transparent menus, bright pinstripe patterns, and large icons. In the past eleven years, Mac OS X has been constantly developed and improved, and is now available as version 10.7 “Lion”. The mobile system iOS for iPhone, iPod Touch, and iPad was also derived from Mac OS X. Apple probably would not have turned things around with a new Apple operating system alone.

There lacked a suite of carefully coordinated multimedia programs. Steve Jobs received aid from Germany, and in April 2000 took over the small software company named Astarte in Karlsruhe. The group led by Freddie Geier also made sure that Apple came out with no major damage from a class action lawsuit by disappointed customers of OS9, which lacked a functioning DVD player. Years later, members from the Astarte team reported how both fascinating and exhausting it was to work for Jobs. “He knew about every detail. Almost each time when he had taken apart our suggestions and then presented his own brilliant ideas, I thought to myself ‘Damn, I could have come up with this myself”,” said Geier.

The iPod-Revolution

With the founding and rescuing of Apple and the Macintosh alone, Steve Jobs would have already earned himself a prominent place in computer history. But his pioneering developments went far beyond the world of personal computers. Mid-October 2001, a selected group of technology journalists in the United States received an invitation to an event on the corporate campus in Cupertino where a “breakthrough digital device” should be unveiled. “Note: It is not a Mac.” Jobs had summoned to present the first iPod, which he had developed with his team for over a year. Six weeks after the attacks of September 11, 2001, people in the US were still in a state of shock.

No wonder that the presentation of the first iPod initially attracted little public attention. Only few had the power to imagine that a device smaller than a cigarette package with a built-in hard drive, a click wheel, and the associated iTunes software, could turn the entire music industry upside down. Some time later, when the iPod started to work with Windows computers, one could see the white Apple headphones in public more and more often. For Jobs it was not just about a portable device on which one could play one’s music collection on the go. To the music lover and Bob Dylan fan it was clear that illegal file-sharing services like Napster and Kazaa were ruining the music industry, particularly because there were few legal alternatives to easily download the songs.

Steve Jobs and iPod on the cover of Newsweek

Therefore, he went on a pilgrimage to stars such as Bono from U2, and spoke to leaders in the music industry such as Paul Vidich, head of AOL Time Warner. He asked them for a license for the digital music distribution and demanded to apply a rather simple pricing model (“99 cents per song”). After long hesitation, the record company executives gave in. Many managers in the music and film industries have still not understood that Jobs was the savior and not the gravedigger for the music industry, even though proceeds through iTunes could not compensate for all the losses of record, CD, or DVD sales.

With iPod and iTunes, Steve Jobs changed the laws of the music industry and Hollywood for good and significantly improved the foundation of Apple’s revenue. He was particularly pleased with the fact that he was able to solve the legal conflict with the music label Apple Records during his lifetime and could include his beloved Beatles in the iTunes catalog.

Secret project “Purple 2″

Even more serious consequences for Apple and the industry came with the next major project, which was developed under the code name “Purple 2″. Shortly after the presentation of the first iPod, the Apple leadership dealt with the question of whether Apple should launch a (mobile) phone. In a secret operation, a development group was founded, which remained largely unknown within the company. As part of secret work on a predecessor of the iPad, the engineers in Cupertino had built up a considerable knowledge of touch-screen technology that could be transferred to a smaller screen.

Moreover, a microprocessor ARM11 chip, which could provide sufficient power for complex smart phone applications, finally came on the market. As of 2005, the Apple smartphone designed by Jony Ive gradually materialized. At the MacWorld Expo in January 2007, Steve Jobs boasted, “Today, we’re introducing three revolutionary products of this class. The first one is a widescreen iPod with touch controls. The second is a revolutionary mobile phone. And the third is a breakthrough Internet communications device.” Jobs repeated this list many times until it began to dawn on even the last visitor at the Moscone Center what he meant: “These are not three separate devices – this is one device… and we are calling it iPhone!” The old archrivals from Microsoft attempted to ridicule Apple’s advance. “It’s the most expensive mobile phone in the world,” barked Microsoft CEO Steve Ballmer in a TV interview. “The business customer will reject it because it has no keyboard.” Ballmer was very much mistaken. By the end of the first fiscal quarter 2012 (end of December 2011), Apple had sold 183 million iPhones.

Sales figures Apple iPhone

Only Google could keep up with the iPhone, thanks to its Google Android mobile operating system. Until his death Steve Jobs was convinced that the success of Android was only possible because of a betrayal of the long-standing Google boss Eric Schmidt. Between 2006 and 2009, Schmidt was on the Apple Board, where he had seen the development of the iPad and iPhone. His obligations to Apple did not prevent him from pushing Google to develop a competing system. Only when his conflict of interest became very obvious, Schmidt resigned from the Apple board. In January 2010, when the Taiwanese company HTC introduced a new Android-powered smartphone, which dominated many of iPhone’s features, Jobs became furious. “Our lawsuit is saying, “Google, you fucking ripped off the iPhone, wholesale ripped us off. Grand theft. I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion in the bank, to right this wrong,” said Jobs to book author Isaacson. “I’m going to destroy Android, because it’s a stolen product. I’m willing to go to thermonuclear war on this. They are scared to death, because they know they are guilty.” Apple and many Android OEMs like Samsung and HTC have been fighting for months in court. Despite victories in some points, Apple was not able to stop the winning run of Android. Jobs could take comfort in the fact that two-thirds of the profits of the entire smartphone industry are noted in the books of Apple, and other manufacturers excluding Samsung, are financially getting nowhere.

Steve Jobs had put the first stages of his personal suffering already behind him when he presented the first iPhone in January 2007. In October 2003 he was diagnosed with cancer, which for months he initially wanted to combat without methods of conventional medicine. Finally end of July 2004, he underwent an operation to have a tumor removed from his pancreas. While in the summer of 2007, at the sales launch of the first iPhone, Jobs again seemed quite well, one year later he appeared at the developer conference WWDC 2008, looking decidedly thinner. In early 2009 he retired from public life and underwent a liver transplant.

He returned to the stage two more times, to present both the first and second iPad. It must have been a big victory for Jobs that under his leadership Apple brought a digital tablet to the market, which at the same time established a new device category. His old adversary Bill Gates had presented tablet PCs on shows such as CES over the past ten years, but the devices were too complicated to use, too expensive and flawed, so nobody bought them. At his last public appearance, Steve Jobs fought for a building permit before Cupertino City council for the futuristic new Apple Campus 2, which was designed by British architect Norman Foster.

Legacy

Over the next few years, a monument of a giant circular building will emerge, as Silicon Valley has not yet seen. For Steve Jobs it was not only about converting his legacy into glass, steel and concrete and making it visible for future generations. The most important “product” on which he worked during the past few years, was Apple itself. For Freddie Geier, who worked for Apple in California and managed the operations of Apple Germany and Central Europe for almost two years, Steve Jobs was an “infinite source of inspiration, a visionary and a genius.” “He was the God of style who could make things beautiful and simple and provide products with emotion at the same time”

Jony Ive at WWDC 2010

At the end, the products always benefited from Jobs’ perfectionism. Under the motto “think different”, he succeeded in finding new ways and celebrating the presentation of secret developments in a masterly manner. It was clear to Jobs that there was nobody in the company who was able to take over all these challenges alone. During the past years, he therefore set up a management team and distributed the heavy burden on the shoulders of several successors. Apple CEO Tim Cook is responsible for ensuring that the company works logistically and is making money. During the memorial service for Steve Jobs at the Apple campus in Cupertino, Cook radiated sovereignty and authority, which is now expected from him by the Apple employees, customers and shareholders.

Tim Cook said Jobs had told him that Apple employees, should not ask what he would have done. “Just do what’s right.” He had seen Disney going into crisis after the death of founder Walt Disney, where “everyone spent all their time thinking and talking about what Walt would do.” In the future, the soul of Apple will probably be represented by Jony Ive. The chief designer has to guarantee that Apple will continue to bring products to market, which are desirable solely because of their elegant appearance.

Meanwhile, rumors have also vanished that the Briton was homesick for the UK, – among others because he saw his twin sons in better hands there. His poised presence at the funeral service, with which he freed himself from his (superior) father Steve Jobs, has not only moved the people on the campus. Jony Ive is also trusted to preserve the high level of Apple’s designs without yelling and strong criticism of the employees.

Scott Forstall

The software expert Scott Forstall will also take a key role in the management team of Apple. Steve Jobs took him in 1992 from Stanford University to NeXT. In 1997 Forstall followed his boss to Apple. He is now responsible for the iOS platform.

“Scott is a gifted genius like Steve. He is in love with every detail, too,” says a former Apple manager. But like Jobs, Forstall is also often difficult and maintained a catastrophic communication culture. The Bloomberg Business Week called Forstall the ” Sorcerer’s Apprentice at Apple” and quoted former Apple software developer Mike Lee: “I once referred to Scott as Apple’s chief a–hole. And I didn’t mean it as a criticism. I meant it as a compliment. You could say the same thing about Steve Jobs.” In such an area of tension, Tim Cook will have the task of softening Forstall’s emotional outbursts and call his younger fellow board member to reason.

In the fine adjustment of the tasks on the management level, Cook, Ive, Forstall, as well as marketing chiefs Phil Schiller and Eddy Cue, who are responsible for the iCloud line at Apple, can count on help: In the end of 2008, seriously ill Steve Jobs lured away the management professor Joel M. Podolny, Dean of the elite Yale School of Management, to found an in-house university at Apple. “Steve was looking to his legacy. The idea was to take what is unique about Apple and create a forum that can impart that DNA to future generations of Apple employees,” said an employee to the “Los Angeles Times”. “No other company has a university charged with probing so deeply into the roots of what makes the company so successful.”

After all, Podolny had almost three years of direct experience with Steve Jobs. Whether and how he will succeed to transfer Steve Jobs’ success formula to future generations of managers from Apple is yet to be seen. ” While there are many great companies, I cannot think of one that has had as tremendous personal meaning for me as Apple.” Podolny wrote in his goodbye to his Yale students. Steve Jobs advised his successors to rely on their own intuition and not on market research.

Steve Jobs quoted Henry Ford, who reportedly said, “If I had asked people what they wanted, they would have said faster horses.” Jobs said, people don’t know what they want until you show it to them. “That’s why I never rely on market research. Our task is to read things that are not yet on the page.”

Steve Jobs family has issued the following statement.

Steve died peacefully today surrounded by his family.

In his public life, Steve was known as a visionary; in his private life, he cherished his family. We are thankful to the many people who have shared their wishes and prayers during the last year of Steve’s illness; a website will be provided for those who wish to offer tributes and memories.

We are grateful for the support and kindness of those who share our feelings for Steve. We know many of you will mourn with us, and we ask that you respect our privacy during our time of grief.

Steve Jobs at WWDC 2008

Steve Jobs has been the most influential inventor and manager in the technology industry. On August 24, 2011, he announced his resignation from his role as Apple’s CEO. Time to look back at the most important marks in his life:

1955: Jobs is born on Feb. 24, in San Francisco and was adopted by Paul and Clara Jobs (née Hagopian) of Mountain View, California, who named him Steven Paul.

1972: Jobs graduated from Homestead High School in Cupertino, California, and enrolled in Reed College in Portland, Oregon. Although he dropped out after only one semester, he continued auditing classes at Reed, such as one in calligraphy.

1974: Jobs returned to California and began attending meetings of the Homebrew Computer Club with Steve Wozniak, a high school friend who was a few years older. He works for video game maker Atari.

1976: Building "Blue Boxes"

1976: Apple Computer is formed on April Fools’ Day, shortly after Wozniak and Jobs create a new computer circuit board in a Silicon Valley garage. The third founder, Ronald Wayne, was serving as the venture’s “adult supervision”. He drew the first Apple logo, wrote the three men’s original partnership agreement, and wrote the Apple I manual. He soon gave up his share of the new company for a total of $2,300 becaus he was afraid of the financial risk. The Apple I computer went on sale by the summer for $666.66.

1977: Apple is incorporated January 3, 1977 by its founders and a group of venture capitalists (Mike Markkula et al.). The company unveils Apple II, the first personal computer to generate color graphics. Sales soar to the rate of $1 million a year.

1978: Jobs’ daughter Lisa is born to girlfriend Chrisann Brennan. She briefly raised their daughter on welfare when Jobs denied paternity, claiming that he was sterile; he later acknowledged paternity. In 1983 he named the “Apple Lisa” after his first daughter.

1979: Jobs and several Apple employees including Jef Raskin visited Xerox PARC in December 1979 to see the Xerox Alto. Xerox granted Apple engineers three days of access to the PARC facilities in return for the option to buy 100,000 shares (800,000 split-adjusted shares) of Apple at the pre-IPO price of $10 a share. Jobs was immediately convinced that all future computers would use a graphical user interface (GUI), and development of a GUI began for the Apple Lisa.

1980: Apple goes public on December 12, raising $110 million in one of the biggest initial public offerings to date. Apple generated more capital than any IPO since Ford Motor Company in 1956 and instantly created more millionaires (about 300) than any company in history.

1982: Annual sales climb to $1 billion.

1983: Steve Jobs began working on the Apple Lisa in 1978 but in 1982 he was pushed from the Lisa team due to infighting, and took over Jef Raskin’s low-cost-computer project, the Macintosh. A turf war broke out between Lisa’s “corporate shirts” and Jobs’ “pirates” over which product would ship first and save Apple. Lisa won the race in 1983 and became the first personal computer sold to the public with a GUI, but was a commercial failure due to its high price tag and limited software titles.

“Do you want to sell sugar water for the rest of your life or do you want to come with me and change the world?” Steve Jobs lures John Sculley away from Pepsico Inc. to serve as Apple’s CEO.

1984: Apple launches the Macintosh on January 22, 1984. Its debut is announced by the now famous $1.5 million television commercial “1984″. It was directed by Ridley Scott, aired during the third quarter of Super Bowl XVIII, and is now considered a watershed event for Apple’s success and a “masterpiece”. The Macintosh initially sells well, but follow-up sales are not strong due to its high price and limited range of software titles. The machine’s fortunes changes with the introduction of the LaserWriter, the first PostScript laser printer to be offered at a reasonable price, and PageMaker, an early desktop publishing package. The Mac is particularly powerful in this market due to its advanced graphics capabilities, which had necessarily been built in to create the intuitive Macintosh GUI.

1985: A power struggle developes between Apple Co-Founder Jobs and Apple CEO John Sculley. The Apple board of directors instruct Sculley to “contain” Jobs and limit his ability to launch expensive forays into untested products. Rather than submit to Sculley’s direction, Jobs attempts to oust him from his leadership role at Apple. Sculley finds out that Jobs had been attempting to organize a putsch and calls a board meeting at which Apple’s board of directors sided with Sculley and removes Jobs from his managerial duties. Jobs resignes from Apple and sells all of his Apple stocks – except for one.

Steve Wozniak also de facto resigns from Apple. Officially he returned to Apple product development, desiring no more of a role than that of an engineer and a motivational factor for the Apple workforce. Wozniak permanently ended his full-time employment with Apple on February 6, 1987, 12 years after having created the company. He still remains an employee (and receives a paycheck), and is a shareholder.

1986: Steve Jobs invests ten million dollars in the computer graphics division of George Lucas, which became Pixar later. He also founds Next Inc., a new computer company making high-end machines for universities.

1989: First NeXT computer goes on sale with a $6,500 price tag. Like the Apple Lisa, the NeXT workstation was technologically advanced; however, it was largely dismissed by industry as cost-prohibitive. Among those who could afford it, however, the NeXT workstation garnered a strong following because of its technical strengths, chief among them its object-oriented software development system. Jobs marketed NeXT products to the scientific and academic fields because of the innovative, experimental new technologies it incorporated (such as the Mach kernel, the digital signal processor chip, and the built-in Ethernet port).

1991: Apple and IBM Corp. announce an alliance to develop new PC microprocessors and software. Apple introduces the PowerBook, which established the modern form factor and ergonomic layout of the laptop computer.

1993: Apple introduces the Newton, a hand-held, pen-based computer. It was Apple’s first foray into the PDA markets, as well as one of the first in the industry. Despite being a financial flop at the time of its release, it helped pave the way for the Palm Pilot and Apple’s own iPhone and iPad in the future.

Apple reports quarterly loss of $188 million in July, and CEO Sculley is replaced by Apple president Michael Spindler. Apple restructures and Sculley resigns as chairman.

At Next, Jobs decides to focus on software instead of whole computers.

1994: Apple introduces Power Macintosh computers based on the PowerPC chip it developed with IBM and Motorola. Apple decides to license its operating software, allowing other companies to clone the Mac.

1995: The first Mac clones go on sale. Microsoft Corp. releases Windows 95, which is easier to use and more like the Macintosh. Apple struggles with competition, parts shortages and mistakes predicting customer demand. Pixar’s “Toy Story,” the first commercial computer-animated feature, hits theaters and Pixar goes to Wall Street with an IPO that raises $140 million.

1996: Gil Amelio replaces Michael Spindler as CEO on February 2, 1996. Apple announces on December 10, 1996 to buy Next for $430 million, and its NeXTstep operating system Jobs’ team developed. This deal would not only bring Steve Jobs back to Apple’s management, but NeXT technology would become the foundation of the Mac OS X operating system.

1997: Steve Jobs returns to Apple as an adviser, then appointed “interim” CEO after Amelio is pushed out on on September 16, 1997.

At MacWorld Expo in Boston Jobs puts an end to Mac clones. Steve Jobs announced at this Show that Apple would be entering into partnership with Microsoft. Included in this was a five-year commitment from Microsoft to release Microsoft Office for Macintosh as well a US$150 million investment in Apple. It was also announced that Internet Explorer would be shipped as the default browser on the Macintosh. Microsoft chairman Bill Gates appeared at the expo on-screen, further explaining Microsoft’s plans for the software they were developing for Mac, and stating that he was very excited to be helping Apple return to success. Jobs: “We have to let go of this notion that for Apple to win, Microsoft has to lose. We have to embrace a notion that for Apple to win, Apple has to do a really good job.”

1998: Apple returns to profitability and unveils the iMac. This computer integrated a CRT display and CPU into a streamlined, translucent plastic body. The line became a sales smash, moving about one million units a year. It also helped re-introduce Apple to the media and public, and announced the company’s new emphasis on the design and aesthetics of its products.

Apple discontinues the Newton on February 27, 1998.

2000: At the 2000 Macworld Expo, Jobs officially dropped the “interim” modifier from his title at Apple and became permanent CEO.

2001: In October 2001, Apple introduces its first iPod portable digital audio player. The iPod started as a 5 gigabyte player capable of storing around 1000 songs. Since then it has evolved into an array of products including the Mini (now discontinued), the iPod Touch, the Shuffle, the iPod Classic, the Nano, and the iPhone.

Apple introduces Mac OS X, the modern Mac operating system based on NeXT’s NeXTstep and incorporating parts of the FreeBSD kernel. Aimed at consumers and professionals alike, Mac OS X marries the stability, reliability and security of Unix with the ease of a completely overhauled user interface. To aid users in transitioning their applications from Mac OS 9, the new operating system allows the use of Mac OS 9 applications through the Classic environment.

2003: Apple launches the iTunes music store with 200,000 songs, giving people a convenient way to buy music legally online. Unlike other fee-based music services, the iTunes Store charges a flat US$0.99 per song (or US$9.99 per album). Users have more flexibility than on previous on-line music services. For example, they can burn CDs including the purchased songs (although a particular playlist containing purchased music may only be burned seven times), share and play the songs on up to five computers, and, of course, download songs onto an iPod. It sells 2 million downloads in only 16 days.

2004: In mid-2004, Jobs announces to his employees that he had been diagnosed with a cancerous tumor in his pancreas. The prognosis for pancreatic cancer is usually very poor; Jobs, however, says that he had a rare, far less aggressive type known as islet cell neuroendocrine tumor. After initially resisting the idea of conventional medical intervention and embarking on a special diet to thwart the disease, Jobs underwent a pancreaticoduodenectomy (or “Whipple procedure”) in July 2004 that appeared to successfully remove the tumor. During Jobs’ absence, Timothy D. Cook, head of worldwide sales and operations at Apple, ran the company.

Steve Jobs announces the switch to Intel processors

At the Stanford university’s 114th Commencement on June 12, 2005 Steve Jobs urged graduates to pursue their dreams and see the opportunities in life’s setbacks — including death itself.

2006: Disney buys Pixar for $7.4 billion. Jobs becomes Disney’s largest individual shareholder with approximately 7% of the company’s stock, and much of his wealth is derived from this sale.

2007: Delivering his keynote speech at the Macworld Expo on January 9, 2007, Jobs announces Apple’s its first smartphone. The following day, Apple shares hit $97.80, an all-time high at that point. In May, Apple’s share price passed the $100 mark. The iPhone is released on June 29, 2007. Crowds camp overnight at stores to be one of the first to own the new device.

2008: Speculation mounts that Jobs is ill, given his weight loss. Apple officials stated Jobs was victim to a “common bug” and was taking antibiotics, while others surmised his cachectic appearance was due to the Whipple procedure. During a July conference call discussing Apple earnings, participants responded to repeated questions about Steve Jobs’ health by insisting that it was a “private matter.” Others, however, voiced the opinion that shareholders had a right to know more, given Jobs’ hands-on approach to running his company. The New York Times published an article based on an off-the-record phone conversation with Jobs, noting that “while his health issues have amounted to a good deal more than ‘a common bug,’ they weren’t life-threatening and he doesn’t have a recurrence of cancer.” In September he kicks off an Apple event and says, “The reports of my death are greatly exaggerated,” making a play off a famous Mark Twain quote after Bloomberg News accidentally publishes, then retracts, an obituary that it had prepared in advance.

2009: Jobs explains severe weight loss by saying he has a treatable hormone imbalance and that he will continue to run Apple. Days later he backtracks and announces he will be on medical leave. He returns to work in June. Later it is learned that he underwent a liver transplant at Methodist University Hospital Transplant Institute in Memphis, Tennessee.

Forbes names Steve Jobs Fortune has named Apple CEO Steve Jobs its “CEO of the Decade.” “Beyond his eye for innovation and legendary charisma, the iconic CEO was recognized for the indelible marks he’s left on four different industries.”

2010: After years of speculation and multiple rumored “leaks” Apple announces a large screen, tablet-like media device known as the iPad on January 27, 2010. The iPad runs the same touch based operating system that the iPhone uses and many of the same iPhone apps are compatible with the iPad. This gave the iPad a large app catalog on launch even with very little development time before the release. Later that year on April 3, 2010, the iPad was launched in the US and sold more than 300,000 units on that day and reaching 500,000 by the end of the first week, giving rise to a new category of modern touch-screen tablet computers.

In May 2010, Apple’s market cap exceeded that of competitor Microsoft for the first time since 1989.

Jan. 17, 2011: In an internal memo to Apple employees, Jobs announces a second medical leave with no set duration. Chief Operating Officer Tim Cook will fill in to run day-to-day operations. Jobs said he will continue as CEO and will be involved in major decisions.

August 24, 2011: Steve Jobs resigns his position as Chief Executive Officer of Apple. He is replaced by longtime Chief Operating Officer Tim Cook, and Jobs is now Apple’s chairman. Prior to this, Apple did not have a chairman and instead had two co-lead directors, Andrea Jung and Arthur D. Levinson, who continue with those titles.

Sources:

Steve Jobs. (2011, August 29). In Wikipedia, The Free Encyclopedia. Retrieved 16:19, August 30, 2011, from http://en.wikipedia.org/w/index.php?title=Steve_Jobs&oldid=447347753

Apple Inc.. (2011, August 30). In Wikipedia, The Free Encyclopedia. Retrieved 16:20, August 30, 2011, from http://en.wikipedia.org/w/index.php?title=Apple_Inc.&oldid=447458710

Steve Wozniak. (2011, August 29). In Wikipedia, The Free Encyclopedia. Retrieved 16:21, August 30, 2011, from http://en.wikipedia.org/w/index.php?title=Steve_Wozniak&oldid=447334477

History of Apple Inc.. (2011, August 28). In Wikipedia, The Free Encyclopedia. Retrieved 16:21, August 30, 2011, from http://en.wikipedia.org/w/index.php?title=History_of_Apple_Inc.&oldid=447178387

This entry is published under the GNU General Public License.

Apple Macintosh (1984)

“Insanely great” – Steve Jobs could hardly put into words his enthusiasm by the launch of the Macintosh. On the legendary annual general meeting of January 24th, 1984, in the Flint Center not far from the Apple Campus in Cupertino, the Apple co-founder initially quoted Bob Dylan’s “The Times They Are A-Changin’” in order to then polemicize against an imminent predominance of the young computer industry by IBM.

The early 1980s. 1981 – Apple II has become the world’s most popular computer, and Apple has grown to a 300 million dollar corporation, becoming the fastest growing company in American business history. With over fifty companies vying for a share, IBM enters the personal computer market in November of 1981, with the IBM PC.

1983. Apple and IBM emerge as the industry’s strongest competitors, with each selling approximately one billion dollars worth of personal computers in 1983. The shakeout is in full swing. The first major personal computer firm goes bankrupt, with others teetering on the brink. Total industry losses for 1983 overshadow even the combined profits of Apple and IBM.

It is now 1984. It appears that IBM wants it all. Apple is perceived to be the only hope to offer IBM a run for its money. Dealers, after initially welcoming IBM with open arms, now fear an IBM dominated and controlled future and are turning back to Apple as the only force who can ensure their future freedom.

IBM wants it all, and is aiming its guns at its last obstacle to industry control, Apple. Will Big Blue dominate the entire computer industry? The entire information age? Was George Orwell right?

The crowd, among them the complete Macintosh developer’s team, shouted back: “Nooooo!”

There had been only two milestone products so far: the Apple II in 1977 and the IBM PC in 1981, Jobs continued. “Today (…) we are introducing the third industry milestone product, the Macintosh. Many of us have been working on Macintosh for over two years now and it has turned out insanely great.”

Taking a look at the history of the personal computer today, Steve Jobs was on the right track with his historical comparison. However, it would not be IBM that became the great dominator of the computer industry over the years, but rather, the alliance of Microsoft and Intel.

Steve Jobs

Previous to the Macintosh developer team, others had already tried to design a computer with a mouse and a graphical user interface – one year before Apple did, with its own business computer Lisa, which retailed for 10,000 dollars.

Advertising spot for the Apple Lisa

However, the Lisa computer proved to be a huge flop. With a price of 10,000 dollars (exclusive of a hard disk drive), it was far too expensive; the graphical user interface devoured the Lisa’s power so that the computer did not work particularly briskly. It lacked the necessary programs to induce the business world to buy the Lisa in large numbers. Moreover, the newly established distribution team could hardly resort to any experience in the handling of Corporate America.

Contrary to its elitist predecessors, the new Macintosh was not only to delight a few experts in the Californian Silicon Valley, but also to conquer the masses – and set the standard for future computer generations. Computer columnist Bob Ryan immediately caught the Mac’s revolutionary core:

The Macintosh is the best hardware value in the history (short though it may be) of the personal computer industry. It is a machine which will appeal to the masses of people who have neither the time nor the inclination to embark upon the long learning process required to master the intricacies of the present generation of personal computers. Barring unforeseen technical glitches and assuming that a reasonable software library is in place by the end of the year, the Macintosh should establish itself as the next standard in personal computers.

[ see also the articles:

It all began with “Annie” – Initial drafts of a computer for the masses

Steve Jobs discovers the Macintosh Project]

Against Big Brother IBM

Given the innovative Macintosh, Apple believed it had discovered a way to reclaim the leadership of the then still young market for personal computers from computer giant IBM.

In 1981, IBM had introduced its first PC and seized the Apple II’s position of the most successful personal computer within a few months. Within three years, “Big Blue” had sold more than two million IBM PCs. Therefore, Apple’s 15 million dollar advertising campaign on the occasion of the launch of the Macintosh directly aimed at IBM. The enormous sales campaign had eventually also been responsible for Apple raising the Mac’s originally planned launch price by 500 dollars to 2,495 dollars.

Lisa Flop Causes Trouble for Apple

The Lisa’s failure put Apple into a precarious situation in 1983. The hitherto existing cash cow, the Apple II, had been eclipsed by newer technology and found itself exposed to intense competition. Now the Macintosh was to save Apple Computers from ruin. In its first business plan of summer 1981, Apple had assumed that 2.2 million Macs could be sold between 1982 and 1985; that is about 47,000 units per month. However, the Mac was not brought to market until the beginning of 1984. After the community of the computer nerds (at least those who could afford the first Mac) had satisfied its buying frenzy, the sales of the Macintosh dropped dramatically to about 5,000 units per month.

Apple boss John Sculley could not change much about this either. In order to professionalize Apple’s management and marketing, Steve Jobs had enticed Sculley away from Pepsi with the sentence: “Do you want to spend the rest of your life selling sugared water or do you want a chance to change the world?“

Despite diverse management methods, Jobs and Sculley initially collaborated harmonically and were celebrated by the public as Apple’s “Dynamic Duo.” However, the Mac’s depressed distribution soon caused serious tensions to arise between Jobs and Sculley.

It didn’t do very much. We had Mac Paint and Mac Write were our only applications and the market started to figure this out, by the end of the year people said well maybe the IBM PC isn’t as easy to use or is not as attractive as the Macintosh but it actually does something which we want to be able to do – spreadsheets, word processing and database and so we started to see the sales of the Mac tail off towards the end of 1984, and that became a problem the following year.
John Sculley

At that time, the Mac simply lacked the applications that dragged the Charlie Chaplin figure across the screen box by box in the IBM’s advertising spot for the PC. Therefore, Guy Kawasaki and other “Software Evangelists” of Apple made an effort to convince the developers of other software companies to write programs for the Mac. The Mac’s ROM, which had been calculated far too tight at 128 kilobytes, did not make this a simple task. The narrow bottleneck was not removed until the launch of the “Fat Mac” with 512 kilobytes, one year after the first Macintosh.

[ see also the article:
Showdown at Apple: John Sculley vs. Steve Jobs]

Success on the Second Attempt

In 1987, Apple sold one million Macs and suddenly played in the IBM league again. More than half of the 2,000 dollars for a Mac constituted profit for Apple, so that Sculley and his colleagues in the Apple management believed that the users would always be willing to pay much more for a better technology. Within these years, Apple missed the gigantic opportunity of establishing the Mac as the general industry standard. At that time, either the prices should have been cut dramatically, or a broad licensing program should have been agreed with other hardware producers. With the introduction of Windows 3.0 in 1990, this “window of opportunity” finally shut.

When Steve Jobs returned to his former company in hard times by the beginning of 1997, first as a counselor and then as a principal, the competition for the industry standard between Apple Computers and Microsoft had long been settled. With new Apple talents such as Jonathan Ive, he not only succeeded in bringing the company back on the course of success, but also in making a mark in the industry.

With the Mac, Jobs also astounded experienced pioneers of the computer industry: Future PCs, Intel co-founder Andy Grove said in 1998 in an interview, wouldn’t be general purpose computers to which networking has been added as an afterthought, but networking machines that also do computing. “The iMac embodies a lot of the things I’m talking about,” Grove said. “Sometimes what Apple does has an electrifying effect on the rest of us.”

Christoph Dernbach

And another: “This is a very complicated world. This is a very noisy world, and we’re not going to get a chance…to get people to remember much about us. No company is. And so we have to be really clear on what we want them to know about us.”

And this is the TV spot: