The NeXT Computer Company

DM: Tell me about what motivated you to establish NeXT and what were the goals you set out to accomplish when you set-up this new company?

SJ: That's complicated. We basically wanted to keep doing what we were doing at Apple, to keep innovating. But we made a mistake which was to try to follow the same formula we did at Apple, to make the whole widget. But the market was changing. The industry was changing. The scale was changing. And in the end we knew we would be either the last company to make it or the first to not make it. We were right on the edge. We thought we would be the last one that made it, but we were wrong. We were the first one that didn't. We put an end to the companies that tried to do that. We certainly made our fair share of mistakes, but in the end I think we should have taken a bit longer to realize the world was changing and just gone on to be a software company right off the bat.

DM: Right off the bat? The machine got great reviews when it came out.

SJ: The machine was the best machine in the world. Believe it or not, they're selling on the used market, in some cases, for more than we sold them for originally. They're hard to find even today. We haven't even made them for two, two and a half years.

DM: What are the features that are on the NeXT machine that are still missing from machines today?

SJ: Well first of all it was a totally 'plug and play' machine. Except for Macintosh, that's hard to find. It's an extremely powerful machine, way beyond the Macintosh. So it sort of nicely combined the power of the workstations with the 'plug and playness' of the Mac. Second of all, the machine had a fit and finish that you don't find today.

DM: It's beautiful.

SJ: I don't just mean in packaging; I mean in terms of operation. Simple things to complex things. Simple things like soft power on and off. A trivial little thing but as you know one of the biggest reasons people lose information on computers is they turn them off at the wrong time. And when you get into a multi-tasking network system that could have much more severe consequences. So we were the first people to do that and some of the only people who do that where you push a button and you request the computer to turn off. It figures out what it needs to do to shut down gracefully and then turns itself off. Of course the NeXT Computer was also the first computer with built-in high quality sound, CD quality sound. Most people do that now. It took them a long time but most people do that. It was just ahead of its time.

DM: NeXT Software: what makes it different? What trends does it respond to?

SJ: That's the real gem. I'll tell you an interesting story. When I was at Apple, a few of my acquaintances said "You really need to go over to Xerox PARC (which was Palo Alto Research Center) and see what they've got going over there." They didn't usually let too many people in but I was able to get in there and see what they were doing. I saw their early computer called the Alto which was a phenomenal computer and they actually showed me three things there that they had working in 1976. I saw them in 1979. Things that took really until a few years ago for us to fully recreate, for the industry to fully recreate in this case with NeXTStep. However, I didn't see all three of those things. I only saw the first one which was so incredible to me that it saturated me. It blinded me to see the other two. It took me years to recreate them and rediscover them and incorporate them back into the model but they were very far ahead in their thinking. They didn't have it totally right, but they had the germ of the idea of all three things. And the three things were graphical user interfaces, object oriented computing and networking.

Let me go through those. Graphical interface: The Alto had the world's first graphical user interface. It had windows. It had a crude menu system. It had crude panels and stuff. It didn't work right but it basically was all there. Objects: They had Smalltalk running, which was really the first object-oriented language. Simula was really the first but Smalltalk was the first official object oriented language. Third, networking: They invented Ethernet there, as you know. And they had about two hundred Altos with servers hooked up in a local area network there doing e-mail and everything else over the network, all in 1979. I was so blown away with the potential of the germ of that graphical user interface that I saw that I didn't even assimilate or even stick around to investigate fully the other two.

NeXTStep turned some of that vision into reality. It incorporated the world's first truly commercial object oriented system, and really was the most networked system in the world when it came out. I think the world has made a lot of progress in networking but hasn't yet crossed the hurdle into objects and what's happened with NeXTStep. It's starting to get adopted by some very large corporate customers. It is now the most popular object oriented system in the world, as objects are on the threshold of starting to move into the mainstream. The company last year recorded its first profit in its nine year history, and sold fifty million dollars worth of software. I think we're going to have some significant growth this year and it's fairly clear that NeXT can get up to being a few hundred million dollar software company in the next three or four years and be the largest company offering objects until Microsoft comes into the market at some point, probably with a pretty half-baked product.

DM: Some people say that in the future object-oriented software is going to be the only kind of software.

SJ: Of course its true. I remember being at Xerox at 1979. It was one of those sort of apocalyptic moments. I remember within ten minutes of seeing the graphical user interface stuff, just knowing that every computer would work this way some day; it was so obvious once you saw it. It didn't require tremendous intellect. It was so clear. The minute you understand objects, it's all exactly the same. All software will be written using object oriented technology some day. You can argue about how long its going to take, who the winners and loosers are going to be, but I don't think a rational person will debate its significance.

The Internet

DM: Give me your thoughts on the current status and the future of the Internet and the commercial online services and how they're affecting computer development.

SJ: The Internet and the World Wide Web are clearly the most exciting thing going on in computing today. They're exciting for three or four reasons. Number one, ultimately computers are turning into communications devices and ultimately we're spending more and more of the cycles of the computer to not only make it easy to use but to make it easy to communicate. The Web is the missing piece of the puzzle which is really going to power that vision much farther forward. It's very exciting in that way. Secondly, it's very exciting because it is going to destroy vast layers of our economy and make available a presence in the marketplace for very small companies, one that is equal to very large companies. Let me give you an example. A small three-person company in Phoenix, Arizona can have a Web server that looks identical if not better than IBM's or the GAPs or anybody else, any large company. They can gain access to this electronic distribution channel for free. They don't have to build buildings. They don't have to sign up a thousand distributors and have people to call on them, etcetera, etcetera. In essence, direct distribution from the manufacturer to the customer via the Internet, via the Web, direct contact, direct transactions and distribution via UPS or Federal Express--that's going to be cheaper than going through all these middlemen or building hundreds of stores around the country. It is going radically change the way goods and services are discovered, sold and delivered, not only in this country but eventually all over the world. As you know, electrons travel at the speed of light and so it tends to bring the world much closer together in terms of providers and customers. That's pretty exciting. The levelling of big and small. The levelling of near and distant.

The third reason its very exciting is that Microsoft doesn't own it and I don't think they can. It's the one thing in the industry that Microsoft can probably never own. I think one of the things that's essential is that the government continue to fund the Internet as a public trust, as a public facility and remove any of these ridiculous notions of privatizing it that have been brought up. I don't think they're going to fly, thankfully. The Internet cost the U.S. Federal Government about fifty to seventy-five million a year. This is peanuts for what its doing right now and even if that cost someday escalated to half a billion a year which of course you could build the whole Internet each year from scratch if you had to, you could replace all the equipment, etcetera. That would be an extrodinarily small price to pay for keeping it from getting into the hands of any one company and thereby starting to destroy and control the innovation that could take place around the Internet. It's the one last bright spot of hope in the computer industry for some serious innovation to happen at a rapid pace. What's also great about it, again, is that the U.S. in the forefront here. That's what's great about the whole person computer software industry. This is another example where the U.S. is in the forefront. It should be kept open. It should be kept free.

DM: The World Wide Web is literally becoming a global phenomenon. Are you optimistic about it staying free?

SJ: Yes, I am optimistic about it staying free but before you say it's global too fast, its estimated that over one third of the total Internet traffic in the world originates or destines in California. So I actually think this is a pretty typical case where California is again on the leading edge not only in a technical but cultural shift. So I do expect the Web to be a worldwide phenomenon, distributed fairly broadly. But right now I think it's a U.S. phenomenon that's moving to be global, and one which is very concentrated in certain pockets, such as California.

Pixar Software

DM: 85% of the world doesn't have access to a telephone yet. The potential is there and you're pretty optimistic. Tell me about Pixar.

SJ: This story is very interesting. I got hooked up with some folks. Again a friend of mine told me I should go visit these crazy guys up in San Rafael, California who were working at Lucasfilm. Now George Lucas, who produced the Star Wars film trilogy, was a smart guy, and at one point when he had a lot of money coming in from these films he realized that he ought to start a technology group. He had a few problems he wanted to solve. I'll give you an example of one. When you make a copy of analog audio recording, like tape cassette to another tape cassette, you pick up noise artifacts, in this case hiss. If you make a second-generation copy it gets worse exponentially. The same is true of optical analog copies. You take a piece of film, make an optical copy, you pick up noise artifacts, in this case optical noise which comes across as blurriness in some cases, comes across as other noise artifacts in other cases.

Now George, to make Star Wars actually had to composite together up to thirteen pieces of film for each frame. The matt paintings for the backgrounds might be a few pieces of film, the models might be a few pieces of film, the live action might be a few pieces of film, some special effects might be a few pieces of film and every time he'd make a copy to composite two together and then add a third, then add a fourth, he was adding noise artifacts with each generation. If you go buy a laser disk of any of the Star Wars Films, if you stop it on some of the frames, they are really grungy. Incredibly noisy, very bad quality. George being the perfectionist he was, said "I'd like to do it perfectly", do it digitally; and nobody had ever done that before. He hired some very smart people and they figured out how to do it for him, digitally with no noise artifacts. They developed software and actually built some specialized hardware at the time. George had at some point decided that this is costing him several million dollars a year and decided that he didn't want to fund it anymore so I bought this group from George Lucas and I incorporated it as Pixar and we set about revolutionizing high end computer graphics. If you look at the ten most important revolutions in high end graphics, in the last ten years, eight of them have come out of Pixar. All of the software that was used to make Terminator, for example--to actually construct the images that you saw on the screen--or Jurassic Park with all the dinosaurs, was Pixar Software. Industrial Light and Magic uses it as the base for all of their stuff.

But Pixar had another vision. Pixar's vision was to tell stories. To make real films. Our vision was to make the world's first animated feature film--completely computer synthetic, sets, characters, everything. After ten years, we have done exactly that. We have developed tools, all proprietary, to do this, to manage the production of this thing as well as the drawing of this thing, computer synthetic drawing. We are finishing up making the world's first computer animated feature film. Pixar has written it, directed it, producing it. The Walt Disney Corporation is distributing it and it's coming out this year as Walt Disney's Christmas Picture. It's coming out November 11, I believe, and its called "Toy Story." You will hear a lot about it because I think its going to be the most successful film of this year.

DM: Fantastic.

SJ: It's phenomenal. Tom Hanks is the main character's voice. Tim Allen is the second main character. Randy Newman's doing the music for it. It's just phenomenal.

There's a lot of hoopla about Hollywood and Silicon Valley converging. They call it "Sillywood" I think. Pixar is really going to be the first digital studio in the whole world. It really combines art and technology together. Again in a very wonderful way. Pixar's got by far and away the best computer graphics talent in the entire world and it now has the best animation and artistic talent in the whole world to do these kinds of film. We have the second largest group of animators in the world outside of Disney and we think the most talented in the world working side by side with these computer scientists, the best graphics people in the world. There's really no one else in the world who could do this stuff. It's really phenomenal. We're probably close to ten years ahead of anybody else.