[SIGCIS-Members] Counterfactual history: Did the Mac cost Apple a shot at market leadership?

[Hansen Hsu]

A really interesting take on Steve Jobs from the early 1990s is Randall Stross’s Steve Jobs and the NeXT Big Thing which chronicles Steve’s founding of NeXT in 1985, and carries through to NeXT’s decision to end production of its hardware and become a software company in 1993.

Given the time it was written and the consensus at the time that Jobs was a has been who didn’t know squat about how to run a successful company, this is a very interesting counterpoint to the current myth that Jobs was a genius who could do no wrong and shouldn’t have been kicked out of Apple. Unfortunately I think it goes too far in the other direction, painting Jobs as a complete failure of a manager. Though in 1993, this might not have been too inaccurate of a statement. Stross is a business historian, and thus treats NeXT as a case study in failure, especially in comparison to its biggest competition at that time, Sun Microsystems. (This comparison looks very different in hindsight.)
It’s very interesting how the choice to end the story in 1993 essentially makes it a narrative of failure. NeXT manages to claw its way to profitability by 1996, mostly by focusing on custom enterprise client-server software development, and with a new web application server technology, could have become a big dot.com player, when the acquisition by Apple occurred, changing both the trajectories of NeXT and Apple.

Brent Schlender and Rick Tetzelli’s book Becoming Steve Jobs argues that Jobs’ management acumen in his second stint at Apple came from observing Ed Catmull and John Lasseter’s management styles at Pixar. 
But I think that the experience of almost failing with NeXT, pivoting it when the reality of the market refused to be distorted and learning the discipline necessary to keep a startup afloat was also critical. With both NeXT and Pixar, Jobs was losing money hand over foot, and was forced to play the long game and build a reliable platform for long-term development, rather than come out with a revolutionary product every few years that was completely incompatible with what went before. This enabled him to do the same at Apple, where NeXT technology was used to deploy first OS X, then iPhone and iPad. Seeds planted in 1997, utilizing work done in 1987, would bear fruit in 2007 and continue into 2017.

> On Apr 26, 2017, at 1:17 PM, Thomas Haigh <thomas.haigh at gmail.com> wrote:
> 
> Back in the early 1990s he had a very different reputation having been fired by Apple, failed at NeXT, and seen Apple slide towards bankruptcy without him. The narrative in books such as Cringley’s Accidental Empires is that Jobs killed the Lisa division out of spite and jealously. Lisa, which shipped in 1983, was a big expensive ($10,000 incl. hard drive) business-oriented computer with GUI, mouse, etc., a hard disk, multitasking, built in networking, etc. Jobs was feverishly devoted to the idea of a small, cheap computer – but tech wasn’t ready to produce a cheap computer with a functional GUI. So the team finished up with a small, fairly expensive ($3,000 with a second floppy drive) computer from which expansion slots, a hard drive interface, networking capabilities, etc. were deliberately omitted. According to Cringely, even the ability to solder new chips to upgrade the RAM from 128K (useless) to 512K (skimpy) only made its way into the product by hiding it from Jobs. The Mac sold badly, only starting to take off after Jobs was fired and engineers could start to add the missing features. In 1986 Apple launched the Mac Plus two years later, which finally had 1MB of RAM and a hard drive interface. In 1987 the Apple II added expansion slots and networking, but cost around $7K for a full system. 
> 

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