Saturday, May 31, 2008

Business

Why Apple Sees Next as a Match Made in Heaven

Published: December 23, 1996

Sometimes breaking the rules works best.

Despite her reputation as a stuffy corporate manager, Apple Computer's chief technical officer, Ellen Hancock, picked up the telephone in mid-November and returned a call from an unknown marketing manager at Next Software Inc.

In the world of corporate managers, that in itself is unusual. Much of the time top corporate executives will only talk to their peers. However, Next's product manager, John Landwehr -- a longtime Apple Computer fan who was still proud that he once owned an Apple II -- believed there might be a good match between the two companies.

After reading newspaper accounts saying that Apple was in private discussions about acquiring a new operating system, Mr. Landwehr, without a word to Steven P. Jobs, his company's chairman, persuaded his colleague Garrett Rice to pick up the phone and call Ms. Hancock.

The pitch was simple: As long as Apple was shopping for software technology, why not take a look at Next, whose long-neglected operating system had a reputation for elegance?

The first meeting took place on the Tuesday before Thanksgiving, and several days later the two Silicon Valley companies were deeply involved in talks to Friday's announcement of the $400 million merger that brought Mr. Jobs back to Apple.

''Ellen did something that was unusual for a person in her position,'' Mr. Jobs said. ''She returned his phone call.''

Now the world is waiting to see if Apple can reinvent itself and reclaim the mantle as the personal computer industry technology leader.

To be successful in marrying its software to the Nextstep operating system, Apple Computer will need to quickly woo thousands of Macintosh developers by convincing them that the new Next-Macintosh hybrid will be a strong technical competitor to Microsoft's Windows 95 and NT programs.

Apple, based in Cupertino, Calif., hopes that Next's features, like a powerful development system, will be so attractive that software developers will be willing both to write new programs for it and to rewrite their existing software -- in many cases for the second time. (When Apple decided to shift its hardware from the Motorola 68000 microprocessor chip to the new PowerPC chip in 1991, software developers had to go through the same drill.)

''The key is to convince developers of innovative new software products that they can make those products run best or only on your operating system,'' Mr. Jobs said. It has happened at least once before, he points out, with the Macintosh, when I.B.M.'s dominance of the PC market was greater than Microsoft's is now.

Mr. Jobs can probably make that case better than anyone. In the end, part of Apple's decision undoubtedly came down to the simple fact that Mr. Jobs's most valuable asset is his marketing skill, and marketing is the area where Apple has lost the most ground.

The company needed to do something quickly to counteract the growing perception that Apple was washed up in the face of the computer industry's overwhelming adoption of Microsoft and Intel software and hardware.

Before last week's dramatic decision to buy Next Software Inc., Apple had considered other options, including the former Apple executive Jean-Louis Gassee's Be Inc., as well as Sun Microsystems's Solaris and even an obviously desperate alternative: Microsoft's Windows NT.

But the Nextstep operating system gets high technical marks. The system has a range of features that are spoken of in glowing terms by programmers who have used the system, and although Mr. Gassee's Be operating system was in several ways more modern than Nextstep, the ability to attract programmers back to the Apple camp may have proved an overriding advantage.

More important, if Apple's technical team can keep its promise and deliver a commercial version of a new Macintosh operating system within a year, the Nextstep software could permit the computer maker to make quick inroads on Microsoft.

''The interesting thing about Nextstep is that it was somewhere between five and seven years ahead of everyone else,'' said Eric Schmidt, chief technical officer of Sun Microsystems. ''It's a beautiful piece of work.''

 

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