The Apple Computer Company

DM: I've got a couple of questions I'd like to ask you about specifically about your experience at Apple. Looking back at the years you were there, what were the accomplishments you are most proud of? Are there a couple of Apple stories you really like to tell?

SJ: Apple was this incredible journey. I mean we did some amazing things there. The thing that bound us together at Apple was the ability to make things that were going to change the world. That was very important. We were all pretty young. The average age in the company was mid-to-late twenties. Hardly anybody had families at the beginning and we all worked like maniacs and the greatest joy was that we felt we were fashioning collective works of art much like twentieth century physics. Something important that would last, that people contributed to and then could give to more people; the amplification factor was very large.

In doing the Macintosh, for example, there was a core group of less than a hundred people, and yet Apple shipped over ten million of them. Of course everybody's copied it and it's hundreds of millions now. That's pretty large amplification, a million to one. It's not often in your life that you get that opportunity to amplify your values a hundred to one, let alone a million to one. That's really what we were doing. If you look at what we tried to do, it was to say "Computation and how it relates to people is really in its infancy here. We are in the right place at the right time to change the course of that vector a little bit." What's interesting is that if you change the course of a vector near its origin, by time it gets a few miles out its course is radically different. We were very cognizant of this fact. From almost the beginning at Apple we were, for some incredibly lucky reason, fortunate enough to be at the right place at the right time. The contributions we tried to make embodied values not only of technical excellence and innovation--which I think we did our share of--but innovation of a more humanistic kind.

The things I'm most proud about at Apple is where the technical and the humanistic came together, as it did in publishing for example. The Macintosh basically revolutionized publishing and printing. The typographic artistry coupled with the technical understanding and excellence to implement that electronically--those two things came together and empowered people to use the computer without having to understand arcane computer commands. It was the combination of those two things that I'm the most proud of. It happened on the Apple II and it happened on the Lisa, although there were other problems with the Lisa that caused it to be a market failure; and then it happened again big time on the Macintosh.

DM: You used an interesting word in describing what you were doing. You were talking about art not engineering, not science. Tell me about that.

SJ: I actually think there's actually very little distinction between an artist and a scientist or engineer of the highest calibre. I've never had a distinction in my mind between those two types of people. They've just been to me people who pursue different paths but basically kind of headed to the same goal which is to express something of what they perceive to be the truth around them so that others can benefit by it.

DM: And the artistry is in the elegance of the solution, like chess playing or mathematics?

SJ: No. I think the artistry is in having an insight into what one sees around them. Generally putting things together in a way no one else has before and finding a way to express that to other people who don't have that insight so they can get some of the advantage of that insight that makes them feel a certain way or allows them to do a certain thing. I think that a lot of the folks on the Macintosh team were capable of doing that and did exactly that. If you study these people a little bit more what you'll find is that in this particular time, in the 70's and the 80's the best people in computers would have normally been poets and writers and musicians. Almost all of them were musicians. Alot of them were poets on the side. They went into computers because it was so compelling. It was fresh and new. It was a new medium of expression for their creative talents. The feelings and the passion that people put into it were completely indistinguishable from a poet or a painter. Many of the people were introspective, inward people who expressed how they felt about other people or the rest of humanity in general into their work, work that other people would use. People put a lot of love into these products, and a lot of expression of their appreciation came to these things. It's hard to explain.

DM: It's passion in the truest sense of the word.

SJ: The computer industry is at a very critical juncture where those people are clearly leaving the field.

DM: What are they doing?

SJ: Hard to say. They're not being attracted by something else. They're being driven out of the computer business. They're being driven out because the computer business is becoming a monopoly with Microsoft. Without getting into whether Microsoft gained its position legally or not--who cares? The end product of the position is that the ability to innovate in the industry is being sucked dry. I think the smartest people have already seen the writing on the wall. I think some of the smartest young people are questioning whether they'll really get in it. Hopefully things will change. It's kind of a dark period right now or about to enter.

DM: Apple had a reputation as a company that absolutely broke the mold and set its own course. Looking back from where you are today with NeXT, do you think that, as Apple grew larger, it could have sustained that original approach? Or was it destined to become a big standard American company?

SJ: That's a funny question. Apple did grow big and sustain that approach. 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.

DM: There's obviously a lot of emotional attachment to Apple.

SJ: Oh sure. Apple could have lived forever and kept shipping great products forever. Apple was for a while like Sony. It was the place that made the coolest stuff.

The Kids Can't Wait

DM: Is there a user of Apple or a story that you could tell that in your mind exemplifies what the company stood for and its values at its best? What customers were using the Apple when you were there?

SJ: There were two kinds of customers. There were the educational aspects of Apple and then there were sort of the non-educational. On the non-educational side, Apple was two things. One, it was the first "lifestyle" computer and, secondly, it's hard to remember how bad it was in the early 1980's. With IBM taking over the world with the PC, with DOS out there; it was far worse than the Apple II. They tried to copy the Apple II and they had done a pretty bad job. You needed to know a lot. Things were kind of slipping backwards. You saw the 1984 commercial. Macintosh was basically this relatively small company in Cupertino, California, taking on the goliath, IBM, and saying "Wait a minute, your way is wrong. This is not the way we want computers to go. This is not the legacy we want to leave. This is not what we want our kids to be learning. This is wrong and we are going to show you the right way to do it and here it is. It's called Macintosh and it is so much better. It's going to beat you and you're going to do it."

And that's what Apple stood for. That was one of the things. The other thing was a little bit further back in time. One of the things that built Apple II's was schools buying Apple II's; but even so there was about only 10% of the schools that even had one computer in them in 1979 I think it was. When I grew up I was lucky because I was in Silicon Valley. When I was ten or eleven I saw my first computer. It was down at NASA Ames (Research Center). I didn't see the computer, I saw a terminal and it was theoretically a computer on the other end of the wire. I fell in love with it. I saw my first desktop computer at Hewlett-Packard which was called the 9100A. It was the first desktop in the world. It ran BASIC and APL I think. I fell in love with it. And I thought, looking at these statistics in 1979, I thought if there was just one computer in every school, some of the kids would find it. It will change their life.

We saw the rate at which this was happening and the rate at which the school bureaucracies were deciding to buy a computer for the school and it was real slow. We realized that a whole generation of kids was going to go through the school before they even got their first computer so we thought the kids can't wait. We wanted to donate a computer to every school in America. It turns out that there are about a hundred thousand schools in America, about ten thousand high schools, about ninety thousand K through 8. We couldn't afford that as a company. But we studied the law and it turned out that there was a law already on the books, a national law that said that if you donated a piece of scientific instrumentation or computer to a university for educational and research purposes you can take an extra tax deduction. That basically means you don't make any money, you loose some but you don't loose too much. You loose about ten percent. We thought that if we could apply that law, enhance it a little bit to extend it down to Kthrough 8 and remove the research requirements so it was just educational, then we could give a hundred thousand computers away, one to each school in America and it would cost our company ten million dollars which was a lot of money to us at that time but it was less than a hundred million dollars if we didn't have that. We decided that we were willing to do that.

It was one of the most incredible things I've ever done. We found our local representative, Pete Stark over in East Bay and Pete and a few of us sat down an we wrote a bill. We literally drafted a bill to make these changes. We said "If this law changes we will donate a hundred thousand computers at a cost of ten million dollars to us." We called it "the kids can't wait bill". Pete Stark introduced it in the House and Senator Danforth introduced it in the Senate and I refused to hire any lobbyists and I went back to Washington myself and I actually walked the halls of Congress for about two weeks, which was the most incredible thing. I met probably two-thirds of the House and over half of the Senate myself and sat down and talked with them.

It was very interesting. I found that the House Members are routinely less intelligent than the Senate and they were much more kneejerk to their constituencies--which I found initially quite offensive but came to understand later to be a really good idea. Maybe that's what the framers wanted. They weren't supposed to think too much, they were supposed to represent. The Senators are supposed to think a little more. The Bill passed the House with the largest favorable majority of any tax bill in the history of this country. What happened was it was in during Carter's lame duck session and Bob Dole who was then Speaker of the House killed it. He would not bring it to the floor and we ran out of time. We would have had to have started the process over in the next year and I gave up.

However, fortunately something unique happened. California thought this was such a good idea they came to us and said "You don't have to do a thing. We're going to pass a bill that says 'Since you operate in the State of California and pay California Tax, we're going to pass this bill that says that if the federal bill doesn't pass, then you get the tax break in California'. You can do it in California, which is ten thousand schools". So we did. We gave away ten thousand computers in the State of California. We got a whole bunch of the software companies to give away software. We trained teachers for free and monitored this thing over the next few years. It was phenomenal. One of my great experiences and one of my biggest regrets was that really tried to do this on a national level and got so close. I don't think Bob Dole even knew what he was doing but he really unfortunately screwed up here.

DM: That's a great story.

SJ: That's part of what Apple was about.

DM: On the business side, I was at the Washington Post when the Macintosh was introduced. The Post was an IBM Big Blue Shop and nobody was going to play with it and then the Macintosh infiltrated. There was almost a guerilla movement. It started with ad artists and now the whole front end of the newspaper is being done on Apple machines. Was that fairly common, this guerilla movement?

SJ: Actually we had no concept of how to sell to corporate America because none of us had come from there. It was like another planet to us. Unfortunately I had to learn all that stuff. If I only knew now what I know now we could have done a lot better. Our attempts to sell to corporate America were just bungled and we ended up just selling to people who just sort of buying a product for its merit not because of the company it came from. I mean everybody was very hooked on Big Blue back then and they bought IBM. There was that famous phrase "You never get fired for buying IBM." We fortunately were able to change a lot of that. And Apple as you know, I believe, is a bigger supplier of personal computers than IBM.