Palm’s Disaster. Apple’s Fate.

Here’s an annoying article: Palm’s disaster shows Apple is screwed when Steve Jobs leaves. Look, I’d like Apple’s stock price to drop because I’d like to buy some stock at a discounted rate and enjoy myself when the iPad blows out all the “analysts'” expectations, so go for it.

The Short Version

Jonathan Ive joined Apple in 1992.

The Long Version

Apple definitely benefits from Jobs being there, no question. But when I would rack my brain for the key people at Apple, Jon Rubenstein was not at the top of my list. Jonathan Ive, Tim Cook, and Steve Jobs would be my picks. Tim Cook is expected to replace Jobs if he “leaves”. He was the guy who reduced Dell’s inventory times (the amount of junk in the supply-chain, which determines how quickly you can respond to changes in demand) to the lowest in the industry, and then got poached by Apple and got and kept Apple’s inventory times below Dell’s (it helps not to have 200 different products). This is something everyone in the industry works their asses off at every day of the week and Apple does it better than everyone else.

Indeed, I suspect that one major reason behind Jon Rubenstein’s departure from Apple was that Apple didn’t see him as a captain so much as a gifted lieutenant. And at Palm he did the job of a good lieutenant—they told him to build a nice handset, and he did. What he didn’t do was define the problem. This, by the way, is the difference between tactics—execution—and strategy—deciding what you want to execute. Yes, it’s elephants all the way down (you can always reframe your particular problem and call that “strategy”), but Palm’s fundamental problem was that it was no longer competing against handset makers and therefore the solution to its problems was never going to be merely building a better handset.

Now, Cook’s talents may seem prosaic compared to Jobs’s ability to—like a sculptor—see the perfect product hidden inside a mare’s nest of useless or unusable features and crappy interfaces and then carve that perfect product out of the dross. And maybe it is. But unlike John Sculley, Tim Cook appears to understand his own limitations. It’s also worth mentioning that in the histories of Apple I’ve read, the single greatest contribution Jobs made to Apple early on was negotiating component prices. One of the things Steve Jobs understands is that there’s no point delivering perfect products if no-one can afford them, and there’s no point selling products if you don’t make money from them. This is why he rebelled against Apple’s upper management (which was behind the $10,000 Lisa), raised a pirate flag, and developed the $1000 Macintosh.

There are two schools of thought on Apple minus Jobs: Apple without Jobs will suck the way it did last time Jobs left Apple. Or, Apple without Jobs will do just fine because Jobs has created a team that “gets it”.

While I fall in between these two extremes, the thing is, Apple without Jobs didn’t suck that badly the first time. I remember BYTE magazine reporting on—I think—the Mac’s 10th anniversay that the previous ten years had essentially comprised the rest of the industry trying to keep up with Apple. In 1990, Photoshop debuted on the Mac because that was the platform people doing cool stuff wanted to write code for. Indeed, aside from 3d and accounting software, pretty much all the powerhouse apps started on the Mac during the period of Jobs’s absence (Flash, Acrobat, Pagemaker, Dreamweaver, Quark XPress, PowerPoint… the list goes on and on). Ten years after Jobs had left, Apple was in pretty good shape and producing the world’s best desktop computers with the world’s best desktop OS. It had also produced the Newton—which could definitely have benefited from the kind of prosaic skills (industrial design, optimized production) Apple has now built into its process (until Jobs returned, Apple largely outsourced its industrial design)—and helped pioneer digital photography (ditto).

It took ten years without Jobs for Apple to run into major problems. In fact, I’d argue that it was Motorola’s inability to deliver a successor to the 68040 that really screwed Apple. (It pretty much screwed NeXT too, incidentally. Indeed, the way NeXT dealt with the problem–becoming a software company–really demonstrates the difference between Jobs and Sculley — Jobs made the issue into a non-issue, Sculley went for an expensive, risky option that — given that no-one really bought Macs for their CPUs—had no real upside.) If Apple has learned one thing from Jobs it’s that it now knows what it’s good at and what it isn’t good at. Apple today knows where it adds value.

Let me beat this point to a pulp: in Jobs’s absence, Apple’s woes began with the floundering of the 680×0 and became critical with the failure of Copland. But Apple managed to develop an excellent new OS with all kinds of goodies that even today’s “modern” OSes lack during this period for the Newton. Instead of fixing Mac OS (which was its bread and butter) it wasted money, time, and talent building a new—quite impressive and innovative—OS, programming language, IDE, and apps for a totally untested product concept that would have been better served by a cut-down Mac OS running HyperCard with a handwriting recognition engine. Jobs has said that the most important part of his job is saying “no” to good ideas (obviously I’m paraphrasing) — spot the things someone needed to say “no” to in those sentences.

In 1994, Apple was making computers with CPUs it helped design (and was the only major customer for), custom video hardware, custom ASICs, custom motherboards, SCSI hard disks (when everyone else was using IDE), non-standard expansion card slots, non-standard video connectors, keyboards and mice that ran on a proprietary (albeit excellent) desktop bus, and with built-in non-standard ethernet that required a special adapter that cost more than a PC ethernet card to hook up to anything including another Mac. And doing all this it was still highly profitable, because it still had the best desktop OS and the best graphics. A future Apple without Jobs may be worse off, but I doubt they’ll be quite so arrogant as that.

Then again, the iPad features an ARM-licensed CPU built into an Apple SoC. As Gruber says, “what Apple will be like post-Jobs is simply unknowable.” I’m not even sure I understand Apple with Jobs.