Magazine

NOTES FROM THE ROAD

The Confidence Man

Robley Curtice

SAN FRANCISCO--In a dark turtle-neck jumper and slate colored corduroys, sporting a small goatee and thin- rimmed glasses, looking like an art director at high-profile advertising agency, Steve Jobs strode on stage at the recent Macromedia Users Conference. Using similar material to his previous week's speech at Seybold '97, he again evangelized a revitalized Apple in his campaign to make people again confident in Apple . He was there to tell ,"... what we're doing in getting Apple back to where it used to be." In the process he promised some "real cool technology." The first change he outlined was the new board of directors for the seven billion dollar company (he said) that is Apple Computers, Inc. Included were heavyweights like Larry Ellison from Oracle and Bill Campbell from Intuit. The new board brought "scar tissue" (experience) from previous endeavors and would be able, hopefully, to avoid some of the same mistakes they made in the past.

The next move was to include Microsoft in the mix and, believe it or not, accepting 150 million dollars was only the first step. They got Microsoft to promise to rollout their new programs, including MS Office, in the Apple platform. It was a "partnership" to "normalize relations," in Jobs terms. Apple did agree to make Internet Explorer their default browser as part of the deal (which is now probably on hold because of the DOJ action). Jobs said he had decided that it was not really a case of either Apple had to triumph over Microsoft in order to win the PC market, but that they both could cooperate and prosper. There was some success this year, he continued. After only 9 months, Apple has sold 1.6 million copies of its new operating system Mac OS8. Of course, the operating system that everyone is waiting for is Rhapsody, and he had comments about that. He said the company would rollout it out the way that Microsoft rolled out NT: first as a server system, then as a high-end client system. However the operating system now for the personal computer is Mac OS and the investment money will go into it.

"Clone economics"-- as he called the dustup with the companies that were producing Mac copies-- forced the cancellation of licensing contracts. The companies were paying about fifty dollars per machine and then attacking the high end of the market. "The market wasn't being enlarged. Less than one percent of Power Computing's customers were new to the Mac." After many meetings, they told him to "go pan sand" (which has to be the most original quote in a long time). "We did what we had to do," by buying back Power Computing's license to the Mac OS. (This action made Motorola leave the market, and IBM is expected to follow, which would leave only Umax Computing producing Mac clones.) Next technology was discussed. He said that the Newton at 700 dollars per device has a projected sale of a hundred thousand, which certainly would help Apple. Then there was QuickTime. Apple invented quick time some six or seven years ago and Jobs thought it was the "bedrock technology" of the company. "QuickTime is the Rosetta Stone of digital media," Jobs declared. QuickTime enables the movement of content from different applications from one media to another. It has an incredibly rich environment, is very robust, and is format and hardware independent. Right now, Apple has a work group of one-hundred people on it. "QuickTime is a very persuasive technology", he continued, "with almost half of the video on the Web using it. It also can play 80% of the video on the Web. Concurrently, we have a Windows version of QuickTime coming out using the same code base."

Another huge plus for the company was the fact that Apple has one of best half-dozen name recognition in the "universe" (as Jobs put it). It's in a league with Sony, Disney, Nike and Coke. The brand name has suffered from neglect, there was no doubt about that. Then Jobs said, "We mean to nurture this brand, and the way to do that is not to go out and speak mush. The way to do this is to do this is to ask ourselves who are we, and to go after what we care about. What we care about is making tools for the creators of this world. Those who push the world forward in bigger and smaller ways." Using the ad agency Chiatt-Day (who did the famous "1984" commercial), Apple will use images of famous people who changed history. The company will be equated with the tag line, "Think Different." Next followed a screening of the new television spot, which featured people like Ghandi, Amelia Earhart, Picasso, Martin Luther King and Bob Dylan among others.

After quick summation, he brushed aside a question about whether or not he would become CEO by saying that he was going on a Hawaiian vacation to think it all over. All in all it was an impressive performance. Now if the gods of commerce smile on Apple it might march successfully into the next millennium. A week after this speech, the bad news hit: Apple Computer lost $161 million in the third quarter of the year, bringing to a final total of $1.05 billion for the year thus far. With revenues down and layoffs looming, Jobs will have to redouble his confidence campaign to bolster the company.

Robley Curtice (robleyc@well.com), a San Franciscan, is an early-retired teacher who haunts West Coast technical conferences searching for the 21st Century Killer App.

Copyright © 1997 by Robley Curtice. All Rights Reserved.