The Macintosh Story Part 2

as it turns out. There was a lot of argument going on arguing, i should say, going on behind the scenes. It started off as a low price computer. That was the intent that was supposed to make personal computers more accessible to the average person. And then Steve Jobs effectively took over the project and changed it significantly. Rather than having a cheap machine, it became an expensive alternative to the IBM personal computer that had just debuted in the

early nineteen eighties. So the IBM personal computer came out and actually posed a serious threat to Apple. Uh, the Macintosh was supposed to be an answer to that. The Apple two and Apple three lines were distinct, and more about them in a little bit, but the Macintosh was really supposed to redefine computing and to put Apple back on track to being ahead of the game, as it were. But what actually happened next, Well, we ended right around

nineteen eighty five. Last time, nineteen eighty five. The Macintosh computer debuted in nineteen eighty four, and Apple was trying to rebound from a couple of big blows. Now. That first one came in nineteen eighty one. That's when IBM got involved in the personal computer market with its own PC. Before long, IBM PC sales were outpacing Apple to sales. And the second blow came ine that's when Apple launched Lisa.

Lisa was a high end computer. It was a project that was being pushed primarily by Steve Jobs, one of the co founders of Apple. Steve Jobs and Steve Wozniak were the two Steve's who founded the company. But Lisa was not a huge success. It had a graphic user interface or gooey g u i uh, and it had a mouse, which was very innovative for the time. The only other company that really played with graphic user interfaces and a computer mouse was Xerox, and they had only

done it internally. They didn't make this a product that other other companies and consumers could go out and purchase Apple decided to change that. However, Lisa had a really hefty price tag. It was ten thousand dollars when it went on sale, and it was meant for business applications. But at that price, very few businesses we're willing to take the plunge. Remember, those are three dollars. That's significant, even more so than ten tho dollars is today. Ten

dollars is already a huge amount of money. If you had just for inflation, you're talking around almost twenty dollars. That's a lot. So the g U I also ate up a lot of the computer's processing power. So not only did it cost a lot, but the operating system alone took up so much of the computer's processing power that you couldn't run very many applications on top of it. And that's not a great selling point, Like this is expensive, but at least you can't run much software on it.

That doesn't make a really good tagline if you're trying to sell a computer, just an f Y I in case you ever want to make and sell computers in the future. Then you also had very few developers who are willing to put forth the effort to create programs for a computer or that was so elite, so expensive

that it had a very small market. If you are in the business of making software and you have a limited amount of time and money on your hands, you want to dedicate that time and money toward projects that are likely to give you the biggest profit. And if you're talking about you know, the types of organizations that are willing to lay down ten grand per computer, that's a very small market. So software developers were not eager to jump on the bandwagon there. So Lisa was effectively

a flop. It was kind of doomed from the start. Now, as I mentioned right at the beginning of this episode, Steve Jobs effectively took over the Macintosh project. Now, this was after the then CEO of Apple demanded that Steve Jobs stop interfering with Lisa. Macintosh was a totally different project, and Steve Jobs, once he was pulled off the Lisa project and said you can't bother them anymore, looked around, saw the Macintosh project, which was completely independent, and said

I'm gonna make that my pet project. And so he began to involve himself with or in the words of some of his UH contemporaries at the time interfere with the Macintosh project, and as a result, Macintosh transformed from a humble machine to an expensive consumer level device with a gooey and a mouse. It didn't have a graphic

user interface before Steve Jobs got involved. It was initially priced at two thousand four dollars, which is expensive just for a basic computer today before you adjust for inflation. If you do adjust for inflation, that's more like five thousand, seven hundred bucks. That's a huge amount of money to ask to pay for a PC. So if you wanted a Macintosh when they first launched, you'd be plopping down the equivalent of fifty seven hundred dollars in today's money.

And keep in mind that the original plan was that this computer was supposed to cost five hundred dollars, which would be closer to twelve bucks today, which is still expensive. Obviously, if you wanted to pay for a brand new computer, twar is closer to the top end of your of your basic machines. I mean, obviously, you can trick out a machine to be much more expensive than that if you want top of the line processors, UH graphics cards,

cooling systems, all that sort of stuff. But if you're just buying off the shelf, twelve hundred dollars is already pretty expensive. It's not it's not the top end, but it's healthy, right Anyway, that was the initial goal was a five price point in four dollars, which would be about twelve today, and it blew that out of the water. I should point out, however, that this higher price tag is not entirely the fault of Steve Jobs. I don't

want to give you that impression. It's true that Jobs added a lot of features that necessitated a price hike. No matter what, it was gonna cost more than five dollars because of the changes Steed Jobs made. But as for that price tag of two thousand four dollars, that credit really needs to go to the then Apple CEO, John's Scully. Scully reportedly decided that the initial price tag for the mac which was originally going to be fift

hundred dollars, was too low. He actually said, fifteen hundred bucks. That's that's not high enough for us to really see a huge profit off that. So he knocked it up to and that way the Macintosh would see a profit margin of meaning you make over what you paid to create the computer. He didn't want to have a slim profit margin. However, of course, if you increase the price of a machine dramatically, then you're going to decrease the

number of sales you make. So it's a very delicate balance figuring out how much to price a product so that you get the maximum amount of profit it from your investment. And Scully decided to go pretty hard for that investment with that profit margin. And this also began Apple's long history of being a company associated with the

idea that it's hardware is overpriced. You've probably heard that if you've ever taken any look into Apple products, that you're paying a premium just for the Apple brand name because the products are priced more than what they would be priced by a competitor for an equivalent machine. That's not always the case, by the way, but it happened frequently enough in Apple's past that it became associated with

the company's identity. People thought of Apple as being an elite company, that you were paying that extra price, and that you could be saving money if you just went with a different computer manufacturer, which in some some eras was absolutely true, just not in all eras. Back in those earliest days of Macintosh, It's certainly was the case that is undeniable now. Initial reviews of the Macintosh actually

heaped a lot of praise on the computer. Consumer Reports wrote an absolutely glowing review of the original Macintosh, saying that the interface really transformed computing. The reviews stated that the interface, including the windows that it would use the mouse that you would use to navigate the gooey, were more than just gimmicks, which you know, you could have easily seen them as just being gimmicks. Everyone else was used to using text based interfaces and keyboards, so this

wasn't a guaranteed success right all the gate. But Consumer Reports said, no, they got it right. This actually makes sense. They said that it actually transformed computing from a system of Labyrinthian rules to something that the average person could easily grasp. A Macintosh wasn't a cryptic machine that required the user to learn dozens of command line terms, like you know, various five old trees and ways to navigate

between different directories. You didn't have to do that because it was all graphically presented for you and you just click on whatever it was you needed. It was a device that a novice could learn to navigate within like half an hour of using it. There were some drawbacks, however. That same consumer reports are You pointed out that the operating system on the Macintosh took up an enormous amount

of the computer's processing power. The computer had enough memory to store about eight and a half pages of text after you factored in the operating system. That's text, not images or video or audio. All of that stuff would come later. Just eight and a half pages of text. That's all the memory it could have after you ended up booting up the operating system. This was one of the reasons that I was a real snob about gooey

interfaces or gooey based computers. I hated the day that my dad decided to install Windows on our IBM compatible machine, which was similar in many ways to the mac operating system. Uh. And the reason I was upset about it was because the Windows operating system required so much of our computers ability to process information that it limited the kind of software we could run on it. If your software required more than what the computer could supply, you ran into problems.

And I attributed a lot of that to the operating system. I much preferred DOSS, which was so slimmed down by comparison that you could run lots of different software on it. Well, the same thing was true with the early mac operating system. It just hogged up a lot of the initial Macintosh is uh abilities. And to be fair, the original Macintosh only had a kilobytes of memory, so it wasn't exactly

packing an enormous amount of memory into that package. More and more software developers began to create programs that could only run and E environments, which kind of forced the issue to switch from the DOSS and other operating systems that involved command lines to shift over to graphic user interfaces because a lot of software ended up only being compatible with graphic user interface systems, and that helped force

the issue. I still am bitter about that, even though today I probably wouldn't be able to If you put me in from an Apple to E or an early IBM PC that was just running DOSS, I wouldn't remember any of the commands besides d I R, which is directory for DOSS, I I would be lost. But I still a kind of bitter about all this. Now, I also be fair, I'm an elitist computer nerd type. I'm just an elitist computer nerd type who lacks the information to be able to effectively be an elitist, which is

the saddest kind of nerd. Apple obviously you had really high hopes for that original Macintosh, but they had also had really high hopes for Lisa, and that didn't pan out back in nineteen eighty one, which was back when the Macintosh was still in development. It didn't debut till

nineteen eighty four. Keep in mind, in ninety nineteen eight one, Apple had a plan, and their plan was that they would sell two point two million Macintosh computers by nineteen eighty five, by the end of nineteen eighty five, but that plan was based upon a launch date that would happen sometime in nineteen eighty two, because remember, back then they were still looking at creating a cheap alternative to the other computers like the Apple two and other competing

computers on the market, So they had high hopes that they would be able to sell two point two million units by nineteen eighty five. The computer wasn't even available for purchase until nineteen eighty four, so that's set them back and even if they had launched in nineteen eighty two, they would have had to sell around fifty thousand computers every month to hit that two point to a million mark within the end of They did have an enormous start.

The Macintosh marketing department was great for the launch of the computer, and they sold quite a bit when they first went on the market because people were really excited about it. But after that initial excitement, they weren't able to capitalize on creating a momentum, and it died off pretty quickly. The marketing kind of failed after that initial launch.

The Apple blew too much money early on and didn't have enough to support it throughout its initial launch, so after a successful couple of first months, sales dropped precipitously down to like five thousand units a month, way below the number they would need, So by the end of five they had not sold two point two million units as they had originally planned. It was more like two d fifty thousand units, a huge shortfall. The Macintosh was not quite a flop like Lisa, but it wasn't performing

as well in the market as Apple had hoped. Now it was impressive, but it was suffering from a similar issue as Lisa. It didn't have a lot of applications available for it, and not as many as the competing IBM PCs had. Apple's then CEO admitted as much later on John Scully. He said, Yeah, we didn't do enough to develop software to run this computer. So while the computer was nice to look at, the graphic user interface was interesting, there just wasn't a whole lot to do

with it. You didn't have things like spreadsheet programs. There was a severe lack of utility with their computer. Really. They only had two applications that Mac Wright, which was a word processing program, and they had Mac Paint, which was a simple graphics program. But that was about it. They didn't have the other stuff you would associate with other uters. So while it was user friendly, it didn't

have a lot of usability to it. Like there just wasn't enough to do so that also hurt McIntosh sales. Now you might also remember from our last episode, like I said, the CEO of Apple at this time was John Scully, whom Steve Jobs had lured away from PEPSI.

The story is that Scully was kind of in line to become the chairman of the board over at Pepsi, but it was on a much longer timeline than Scully wanted, and that Steve Jobs was able to convince Scully to come over by saying to him, do you want to spend the rest of your life selling sugared water or do you want a chance to change the world. Once against Steve Jobs, master salesman, he could really have a turn of phrase and get you to believe in him

even when the odds were stacked against him. Scully himself would say that that phrase really convinced him to come over to Apple, and he said so in a documentary, so you can actually check this out. It's a document are he titled Bloomberg Game Changers Steve Jobs. So it's part of a series. It was a really effective sales pitch, as it turns out, so Scullion Jobs initially worked really

well together leading up to the Macintosh launch. Scully's predecessor was Mike Marcula, which in the last episode you might remember was the guy who stepped in to remove Steve Jobs from the Lisa project. Marcula was an early investor in Apple and had transitioned from CEO to board members, so he retired as CEO, he resigned um transitioning over

to the board. He had told his wife that he wasn't going to stay on with Apple for very long, although he stayed on much longer than he initially meant to. He just stayed on in the capacity of member of the board as opposed to the CEO, and then John Scully took over the job as CEO. Now, John Scully would serve as the CEO from about to about nineteen nine. The three ish is really when we're looking at that

transition effectively ninety three. Scully initially got along well with jobs, but when the Macintosh sales began to drop off, new tensions developed between the CEO and Apple's co founder, and that's not great when you have kind of clashing personalities at the top level of your company. Now, John Scully also has the dubious distinction of being on the America The Worst American CEOs list curated by Conde Nast. He's actually number fourteen on that list back when they published

it a few years ago. Now more on why John Scully made that list as this episode progresses. Apple at the time had not completely switched over to the Macintosh line as its primary product. So you might think, oh, it went Apple to to Apple three to Macintosh and

they discontinued the other computers, but that's not true. They were actually producing different lines of computers simultaneously, and Apple's structure was designed around this, where each product had its own division, so it wasn't like you had one big division of all these different products grouped together. You had an Apple two division and Apple three division, and a

Macintosh division. You also had a Lisa division until they discontinued that product, so the Apple two and Apple three computers continued to be manufactured and sold by Apple, side by side with Macintosh computers. The Apple three ended up being a failure. It was a flop, very much like Lisa. It just didn't do so well. It was meant to be, again, a business level machine, not a personal computer, and it was priced as such, and there just wasn't enough there

for businesses jump on board with it. There were cheaper IBM com uters coming out, so that was more attractive from an expense side of things, And like Lisa, there weren't a lot of developers creating software for the Apple three, so it didn't make a whole lot of sense to invest in the Apple three platform if the IBM computer platform cost less and had more development, so companies weren't adopting the Apple three. But the Apple two continued to hold its own, so it was still a big product

even as the Macintosh came online. Uh. The Apple two SEE computer debuted in nineteen eighty four. That was the same year that the Macintosh came out, so Apple too c uh stood for well, a more advanced Apple two computer. Actually, the letter system for Apple two computers is really confusing because the Apple to E came out in nineteen eighty three and then the Apple two C came out in nineteen eighty four, so they weren't going in alphabetical order

and is a bit more than a bit confusing. But the Apple to C was Apple's first compact model, so the C kind of stood for compact. The computer's hardware consisted of a case that had an incorporated keyboard and a five and a quarter inch disk drive, and the computer itself, which was separate from a monitor. It was just the computer. You could slide that into a base a stand essentially, and on top of the stand you could put your monitor, So the computer were kind of

slot in underneath where the monitor was. The monitor would not sit directly on top of the computer case itself. Apple would continue to make computers in the two C line until n so the Apple two continued to go on sale to to hit store shelves while the Macintosh continued to evolve, so these separate products remained side by side for quite some time. Apple launched an enhanced version of the Apple to E in Night five, so the

two E continued as well. It just got a bit of a beefier version than the one that had launched a couple of years earlier. It did not have a graphic user interface like the Macintosh, and Apple would continue to make these Apple to computers available for quite some time. In fact, that advanced to E would continue to be

on sale until n so, extending pretty far. Like you would think that by nine three you would have just graphic user interface based computers, but you still had the Apple to E Enhanced And maybe one day I'll do an episode dedicated just to those Apple line computers to talk about the process of their evolution compared to Macintosh.

But that's not really what this episode is about. I just went into touch base and explained that was going on at the same time as the development for the mac Now, in January, Apple tried to make the best of a bad situation and by launching the Macintosh XL. Only here's the thing, this was not the next Macintosh computer. It was actually a rebranding of a different computer, namely the Lisa two. So remember the Lisa was a flop.

Then Apple decided to make a stripped down version of the Lisa computer and sell it for a lower price than that ten thousand dollar beast of a computer called Lisa. Lisa too did not do well in sales either, so then they rebranded it. They called it Macintosh XL because the Macintosh was doing alright initially, but they weren't able to move the Lisa two computers, so they rebranded it. They called it the XCEL. But it still didn't do so well, and by April they discontinued it. They stopped

making the Macintosh XL. They still had a ton in inventory, but they weren't making more of them. They were able to offload some of the Macintosh XL devices with some big sales deals. So, for example, they sold five thousand of the XL Macintosh is to a company called sun remarketing back in nineteen eight seven. But ultimately a lot of those units never left Apple warehouses. They just sat there.

And so in nineteen eighty nine they decided to take a note from the video game crash of nineteen eighty three. You might remember, Atari decided to get rid of a lot of excess inventory by dumping them in landfills out in the desert. Apple ended up doing the same thing, only they dumped there's in the landfill in Utah instead of in a different states. So they all of those Macintosh XL computers ended up in a landfill in Utah.

So somewhere in a Utah landfill, if you dig down, you would be able to find old Macintosh XL Lisa two computers. But don't do. That will be a colacily bad idea and you could very easily injure yourself if you dug in the wrong landfield. Phil Plus you'd probably be trespassing. So I'm officially telling you do not go searching for the Macintosh x L because even if you found one, it wouldn't work. At this point. It's been exposed to elements since nine nine, So you don't want one.

Don't do it. If I hear about you doing it, I'll be very put out. I've got a lot more to say about the history of the Macintosh from nineteen eighty four to nine, but before I get into the next segment, let's take a quick break to thank our sponsor. All right. So, a few months after the initial Macintosh hit store shelves, Apple released an update called the Mac

five twelve, also known as the Fat Mac. This Macintosh had five twelve kilobytes of memory, That's why it was called that, so significantly more memory than the initial Macintosh, which remember, only had a hundred twenty eight kilobytes. That additional memory made it easier to develop programs for the Macintosh because the operating system no longer hogged nearly all of the system's memory. But that extra memory came at a cost. The fat max price tag was three thousand,

three hundred dollars in nineteen five. That's equivalent to nearly eight thousand dollars today. It's uh incredibly expensive. Still, the Fat Mac had a big advantage. It could actually do stuff pretty big when you compare it to the original Mac, and some software and one additional piece of hardware really helped increase the value of the Macintosh line. So on the software side you had stuff like Aldus page Maker and eventually became Adobe page Maker. It helped usher in

a new era of computing. This was the era of desktop publishing. That was not a thing really before the Macintosh and eldest PageMaker made it a thing. So PageMaker, if you've never used it, it's sort of a layout program and allows you to lay out a an attractive aesthetic design to stuff like newsletters, flyers, that kind of thing. A program if you want to make a program for a play or some other event, you could use PageMaker to size everything and uh and position it properly so

that you had an attractive layout. And that meant that you could suddenly do this at home, whether if you had the right equipment or with a small business. You could do it there. You didn't have to go to a larger publishing house and contract with them to make your stuff. This was revolutionary. It was one of the reasons why computers, personal computers and small computers that bus

this is used. We're so popular and men that they gave these entities, whether they were individuals or small businesses, greater opportunities. Uh, so that was very popular. But there was also some other software that was helping out in Microsoft began to publish software for the Macintosh. So Microsoft and Apple haven't always had a contentious relationship. In fact, Microsoft has often in Apple's past helped the other company

out with loans or with investments. Uh, it hasn't always been a I hate you, No, I hate you more kind of relationship. One of the earliest programs Microsoft made available for the Macintosh was Word one point oh, which was the first real competitor to Apple's own Mac Write software and eventually overtook Mac Write. People began to prefer Word one point oh, and it's later very visians to

the mac right word processing program. Another program that came over to mac was the Excel one point oh software, the spreadsheet program. In fact, it came to the Macintosh first. It was a Macintosh exclusive for a while. Uh in the early days. That was just the case because it wouldn't even come to Windows until late nine. So Apple had a headstart on Windows when it came to Excel. But there's a whole story that I've talked about in a previous episode about why that is so I'm not

going to go into it. Here on the hardware side was a device called the laser writer. This was a printer, a monstrous lee heavy printer. It weighed seventy seven pounds that's about thirty five ms, and it had a three hundred dots per inch resolution, pretty standard for printers of the day. And it cost a hefty amount seven thousand dollars and let's adjust for inflation because I like to do that, that's about sixteen grand in today's dollars. Sixteen

thousand dollars for a printer. But you could network multiple Macintosh computers to this one printer, so that increased its value. You didn't have to buy a printer for every computer. If you had several computer workstations at your office, you can network them together to this printer and they could all print from the same printer. That was a pretty big deal, very novel concept when it came to this

level of computer enterprise. Normally, you'd be paying a lot more money for a networked system that was created pretty much by contract for your company. So it meant that Apple could actually compete in that space. And uh they could also print in different fonts. The earliest laser writer only a few different fonts, but that was still a huge advantage over older printers, remember like Daisy wheel printer. Actually you may not remember Daisy will printers. I do

because I grew up with them. Those had a physical font on the device itself, so you couldn't really change it, but the laser writer could reproduce a few different fonts, giving you some options. And later versions of the laser writer and later versions of the operating system and the accompanying software would allow even more fonts. So that made desktop publishing even more attractive. So this, this combination of software and hardware suddenly made the Macintosh a more attractive

device if you wanted to go into publishing. And this really begins the relationship Apple has with creators, people who are into graphics eventually into film and audio. Apple kind of established that relationship with people at this stage, this early stage with the fat Mac. It meant that you were catering to people who didn't really feel comfortable with the IBM compatible approach to computing. They found it more intuitive to go to the Mac system and that would

remain true for decades. In fact, for a long long time, Apple dominated when it came to production, particularly video and audio production. Here at How Stuff Works, our video department

works almost exclusively on Macintosh computers. So, even though I would argue PCs have caught up in a large part and software for the PCs have caught up in a large part, two, Apple's dominant place in that market, there's still people who prefer the Apple approach, and to be honest, depending upon what format you're working in, Apple still doesn't better than PCs do. All of that began way back in with the Fat Mac and the launch of the Laser Writer and the launch of these software programs I've

been talking about on the corporate side. Five was when Apple said goodbye to the co founders, but under very different circumstances. Steve Wozniak, who had mostly been away from Apple ever since he had suffered injuries in an airplane crash and had been working hard to recover from them. He left on his own accord in February night five, and he went back to college. Eventually he went into teaching and then began to do other stuff as well.

Steve Jobs, however, didn't really have a choice in the matter, not really when you get down to it. After numerous teams reported being incredibly frustrated with Steve jobs managerial style. The executives of the company, primarily CEO John Scully, decided to effectively strip Steve Jobs of all of his power. They removed him from all the projects. They put him in an office in a building that was mostly deserted. Uh.

Steve Jobs himself referred to it as Siberia. And of course Steve Jobs is not one known for making melodramatic statements like that, so you know it had to be awful. But the point being the Steve Jobs had really very little to do with the company that he had helped create. He had been pulled away from it and removed more

or less from power. Not everyone was upset about that because so many people had had issues with his management style, but it still was a difficult story, right to say, we've decided this founder of our company shouldn't be involved in any of the company's projects, but was still effectively an employee of the company. He was still drawing a salary at that point, but Jobs decided he didn't want to just sit at a desk in an empty building

and pull a salary from a company. He wanted to see if he could perhaps regain control of Apple, and so he went to some of the executives at Apple to see if any of them would support him and what would effectively be a coup to go to the board of directors demand that John Scully be removed as CEO and perhaps Steve Jobs would take his place. But one of the executives he went to felt very strongly

that this was the bad decision. That person was Jean Louise guess guess A. Now Jean Louise guess Ay was someone who had risen up in the Apple ranks. He was a manager in their in their various product division lines, and he did not like Jobs. Jobs and guess A did not get along. So guess A ended up going over to John Scully and tattletaled on Steve Jobs. Essentially told John Scully, who was off on a business trip, Hey,

you should know this. Steve is going around stirring up trouble and he wants to try and go to the Board of directors and go over your head and replace you. John Scully rushed back to Apple. He called a meeting of the board of directors. He was furious with Steve Jobs for what he saw as an act of disloyalty and dishonesty, and so they had it out in front

of the Board of Directors. It was, by all accounts and ugly confrontation, and ultimately John Scully was asking the Board of Directors for essentially a vote of confidence and to say, you know, who would they go with? Would they side with Jobs or would they side with Scully um? And then the board cided unanimously with John Scully. Every member of the board, including the people I've already mentioned in this episode, we're on John Scully's side, and they

effectively pushed the Jobs out of his company. Uh. Obviously, the story was Steve Jobs and Apple doesn't end here. In will actually revisit Steve Jobs later on this episode, but we've also covered this story in other episodes of Tech Stuff. So if you want to hear a really deep discussion about what Steve Jobs did in his years away from Apple, there are a couple of different places you can check out, or a couple different episodes you can check out. There's a two parter called How Bill

Gates and Steve Jobs Work. They published in two thousand eight, so they were very early episodes of Tech Stuff. We launched tech Stuff in two thousand eight, So Chris Poulette and I talked about Bill Gates and Steve Jobs, who had a lot of not just similarities, but a lot of They worked a lot together in those early days of Apple and Microsoft. So you can check out that two parter. And there's also a very sad episode titled One More Thing and that published in two thousand eleven,

shortly after Steve Jobs passed away. And in those episodes, I really he talked about what Steve Jobs did in his ears away from Apple. So I'm not going to cover it here, but we will revisit Steve Jobs because he does factor back into Apple's history a bit later on. If you want to know more, check out those episodes I just mentioned. Now, Jobs would end up publishing letters of resignation. He sent letters of resignation to the press after he had effectively been forced out of his own company.

So it's more like you can't fire me, I quit sort of thing. Uh. Presumably he did this in order to get the media on his side, but it did not have the effect that he was hoping for. In fact, Apple stocks rallied as a result of Steve Jobs being pushed aside and sending out these resignation letters. Effectively, the market was saying, who we're sure, are glad you got rid of that guy. Uh. Not a great message to receive. Not a that's big blow to the ego, I'm sure.

But it gave Scully more confidence in his decisions, which would emerge in physical form with the evolution of the Macintosh line. Now. One of the CEO's first acts once he had been confirmed as being the head of Apple, was to lead a massive reorganization at the company, and a lot of people say it was long overdue. So again, up to that point, Apple's org charts were based based on products. If you worked in the Apple two line, you were in one division. If you worked on the

Apple three line, you were in another division. If you worked on the Macintosh you were in yet another division, and so on and so forth. Each department was separate from all the others. And John Scully said, this doesn't

make any sense. What we should do is have a big product development department, and everyone who works on various products will be inside this structured department with a manager overseeing that product, our product development overall, so everyone would have a single boss they would report to, who in

turn would report to John Scully as CEO. Then you would also have a department just for sales, you would have a department just for marketing, and these departments would work together, but they wouldn't be dependent upon individual products. It would largely be these big divisions within Apple. So essentially, he was saying, let's go to your traditional corporate structure. It wasn't like he was inventing a new type of leadership.

This is something that's common across corporations all over the world. So he was just saying, let's go to that because it makes more sense. It's streamlines things, people know who they report to. There's not this this compartmentalized UH structure between different products. People can actually communicate with each other. We can make sure that people working on one product are not stepping on the toes of people who are

working on another product. Everyone can talk to each other, and that ended up being viewed as a positive move in the market. Again, people thought this guy knows what he's doing, and they felt confident in Apple's performance because of this restructuring. UH. Apple stocks would end up performing really well over the next few years. Meanwhile, Jean Luis Gassay, that manager I was talking about who tattle tailed on

Steve Jobs became the manager for the Products division. Effectively, he took over the position that Steve Jobs was inhabiting before he was stripped of all of his responsibilities. So Gassa became the manager for Products Division and decided to make a major change to the Macintosh line. So remember that last Mac was the Fat Mac or the Mac five twelve. The next computer in that line was the Mac Plus. Now Apple introduced this in nineteen eighty six,

and it looked identical to the Fat Mac. If you were to put two side by side, you probably wouldn't be able to immediately tell them apart unless you could actually read the designation on the case. But inside it was actually quite different from the fat Fat Mac. So, for one thing, the Fat Mac was not meant to be expandable. Steve Jobs hated the idea of users being able to alter the computers that Apple designed. He wanted to have closed systems, meaning that you bought a computer,

that's the computer you got to use. You didn't get to expand it in any way unless you were to go to a third party, and that would violate your warranty. The Mac Plus was different, and it was actually expandable. Um, you could upgrade your machine if you wanted to. It was the first Macintosh to feature a small computer system interface, also known as a scuzzy drive s C s I. But people call it scuzzy, not that it was scuzzy,

it's just how we pronounce it. It's actually a set of parallel interface standards that allow you to connect other devices to a computer, so a scanner and external hard drive, printers, that sort of thing. It's just meant to be kind of a universal uh plug for certain types of computer peripherals.

I talked a little bit about it in a recent episode about USBs when I was comparing USB s to serial and parallel ports anyway, uh the scuzzy would remain a feature in every Mac that would follow from that point until n You could also upgrade the memory of the Mac Plus. The Mac Plus would come with a whole megabyte of memory, remember the previous fat Mac at

five twelve kilobytes. Megabyte was another big jump up, but you could expand that to up to four megabytes using a thirty pen memory module that was easily pluggable into the Macintosh system. You didn't have to do any crazy soldering or anything like that. It had an expansion slot you could plug these these chips into. Previous Apple devices didn't allow you to upgrade your memory, so what you bought was what you got, unless you again went to

a third party and had it professionally altered. So this was a huge departure from Steve Jobs's philosophy. Guess Say's approach was almost a hundred eighty degrees different from Jobs, and would continue to be different from Jobs over the next few years. The Mac Plus also included a keyboard with some features that we now considered to be pretty much standard for keyboards, like arrow keys and a number pad. Obviously, not all keyboards have those, especially for things like laptops.

You might not have a number pad on all laptops, but for your standard PC keyboards the kinds for desktops, you pretty much find arrow keys and number pads on most of those these days. But this was novel thinking back in so it was something that differentiated the Mac Plus from other computers on the market, and it also ran the third generation of Max operating system, which was then called System three. This was before Apple started calling

the operating system mac OS. They just called it system and you could use double sided floppy discs with this device, which allowed you to store a whopping eight bytes of data per disc. I remember those days, but anyway, that was a big thing back then. Having a double sided disc, you know, effectively doubling the amount of information you could save on a disc. That was a huge space saver. Otherwise you had to have twice as many of those stupid discs, and that was a pain in the butt.

Later in Apple discontinued the Fat Mac and replaced it with the five twelve K E, which was similar to the Mac Plus. So you had the Mac Plus, which was sort of the high end machine, and then they said, well, the Fat Mac doesn't really mess her up to the Mac Plus. Will make a new version of the Fat Mac called Mac five twelve K. It did not have some of the elements that the Mac Plus had. It didn't have the scuzzyport, and it didn't have the expandable

memory capability. It had those older traditional Apple style memory chips, and as you might imagine, that didn't measure up well with the Mac Plus in the market. So you had consumers or small businesses, mainly and larger looking at the Mac Plus versus the Mac five twelve k E, and they said, why would I go with the five twelve k E which has fewer features than the Mac Plus. So ultimately the five twelve K did not sell very well.

The Mac Plus, however, was a very popular UH product within the Apple line, in fact, so much so that it would become the longest lived computer in the Macintosh line, meaning it was the one that Apple produced the longest amount of time UH from nineteen eighty six to nineteen

so four years of producing the same computer. That's a long time in computer terms, because parts become obsolete so quickly, right processors get faster, we can put more memory into these machines, but the Mac Plus would stay on store shelves largely unchanged from nineteen eight six to nine. Now at this stage, I should mention that I'm not going to cover every single variation of the Macintosh in this episode.

I know it sounds like it because I've started with the big ones so early on, but that would just be ridiculous. If I were to do that, it would eventually just lead to me reading off specs for different computers and that would get incredibly boring incredibly fast. I do want to cover some of the big changes that happened throughout Apple's history and the history of the Macintosh, but I'm not going to cover every variation of every

entry into the Macintosh line. There are lots of them, so many that it actually became a problem for Apple, But I'll go into that in a little bit. I'm just gonna try and get a deeper understanding of not just the growth of the personal computer market, but the evolution of Apple as a company. So that being said, nineteen eighty seven saw some milestones in Apple history. For one thing, Apple built the one millionth Macintosh in nineteen

eighty seven. Now that was a bit behind schedule, because you remember, way back in nineteen eighty one, they were hoping to sell two point two million Macintosh computers by the end of nineteen eighty five. Here it is nineteen eighty seven, and they've just built the one million Macintosh, so they're well behind what they were hoping for back in nineteen eighty one. However, that being said, this was a totally different world seven. You saw massive competition in

the market. Not only did IBM have its own personal computers out there, but you had all the clones of IBM computers, the IBM compatible computers, because IBM licensed that technology to other companies, so there was a lot of competition in the space. So hitting that one million mark was still impressive, even though it was much later than what they had hoped for, uh and it was significant. So that year Apple introduced new computers in the Macintosh line.

They launched the Mac S E and the Mac two as then the part two son of Mac. It was the Roman numeral two as well, kind of similar to how they did Apple one, Apple to Apple three. We start seeing the Macintosh regularly shortened to just Mac. At this point, very few people started referring to them as Macintosh computers. They just called a max really. After the first Macintosh, that became pretty standard, and the Mac two marked another big departure from the original Macintosh design jobs

and wanted the Mac to be that closed system. Like I mentioned, the Mac two had six expansion slots that could port all sorts of stuff, including different types of video cards, which was a huge departure for Apple, plus different types of network cards, scuzzy drives, that sort of stuff.

It could also display color they video cards. If you had the right video card in the right monitor, you could have a color display, which was a first for Macintosh computers, and it pushed the Macintosh from the monochromatic world to the world of glorious color with up to sixteen million different colors that could be displayed, which is

actually pretty impressive back in the mid eighties. Later on that would be dwarfed by what you could achieve with high end video cards and monitors in n Apple's Macintosh line continued to evolve, but there weren't really any major developments like the ones I just mentioned. Instead, it was mostly revisions and evolutions of the line, but not revolutions.

On the software side. The operating system grew, with systems say coming out towards the end of nineteen, but apart from the first Apple CD ROM drive launching, nothing huge really happened in the mac line, and the same is true for eighty nine, with one major exception. That was the year the Apple introduced the mac Portable. So this wasn't really a laptop computer. I mean, you could call it a laptop computer, but really it was more of

a portable Macintosh computer. In theory. You could call it laptop, but only in theory because the thing weighed nearly sixteen pounds or about seven point to six kilograms, which is a pretty weighty machine to call a laptop. It was also bulky, and it was about the size of a standard briefcase. In other words, it was a giant compared

to the Mac Air that you could find today. The Mac Portable had a lead acid battery, which is the same sort of battery you can find in your standard gas powered automobile, like a car battery that's also lead acid. That's type of battery the first Mac Portable had. Now, it did allow you to have about ten hours of battery life, so that's nice, but it added to that significant weight, or it was rather i should say it made up a significant portion of that weight. There were

two main keyboard layouts you could get. One had a numeric keypad and the other one had a track ball which would replace the need for a mouse. So trackball sort of like the old centipede arcade machines, And if you don't know what that is, ask your parents. There were This was another one of the ideas of Jean Louis Gassy. So he decided that the portable computer was an interesting approach. He had already made a decision to stick with Apple. He had received an order, an offer

rather from Commodore. Commodore was making the Amiga line of computers and they wanted Gass to come over as the new head of Commodore. But he actually turned the company down initially and said that he wanted to stick with Apple, and so he really pushed for the portable Mac. Uh. It had pretty impressive specs for the time. Apple said they spared no expense, they made no accommodation for the

fact that was portable. They didn't want to compromise on quality, and in fact, the specs were pretty impressive even for just a regular desktop machine. However, it meant that the device was incredibly expensive, again not a surprise with an Apple, right. So it's price tag was six thousand, five hundred dollars for this portable machine. In so if we look at inflation, that's about thirteen thousand dollars. You would have to pay

thirteen grand to get this portable Mac. Now, there was a call for portable machines because more and more companies wanted people to be able to take a machine into the field You might work for a company like a utility company, and having a computer that your employee could take with him or her on a service call was incredibly valuable. So there was a need for portable machines.

People had a desire for them. There was a market there, but thirteen thousand dollars for a portable Mac was a super steep price, and you might not be surprised to hear that not very many of them were sold as a result. In fact, Apple sales in general were not doing well that year. It marked the first time Apple had an actual drop in sales figures, so they were selling fewer computers than they had in the previous year.

The following year, Gasse announced his retirement from Apple and vacated the head of product development, so he only lasted a little bit longer than Steve Jobs himself did. Now, nineteen ninety also saw a big shift due to outside competition. That's because in nineteen Microsoft launched Windows three point oh. Now, the previous incarnation of Windows had really not made a huge impact on Macintosh sales. Consumers had not really adapted and adopted the Windows platform. But Windows three was a

different story. Windows three and IBM compatible machines were starting to become more popular, and from this point forward, I'm just going to call those PCs. We'll talk about max versus PCs. I don't like that because I think personal computer is too broad a term to just refer to Windows based machines, but just for simplicity sake, we're gonna

do that for the rest of this episode. So PCs were really selling well, and Windows three point oh was a dominant operating system, again a graphic user interface similar to what you would find on the Macintosh. There were even people arguing that Microsoft was copying no Macintosh, but the development of Windows was happening at around the same time him as the development of the Macintosh gooey, and to be honest, both companies really owed a huge debt to Xerox because it was Xerox is Park the R

and d arm of Xerox that developed the graphic user interface. Anyway, the IBM PCs had a huge advantage over Macintosh and that they were less expensive. You could buy an IBM PC for a fraction of what it cost to buy a Macintosh, and then you can get your graphic user interface with Windows three point oh. Uh. In fact, within a couple of years, you would have about five copies of Windows three point oh for every Macintosh that was

being sold. That's not great if you're Apple. Uh. I should also point out that even at this point, as late as n I still hated Windows because I still hated the idea of having to surrender so much of my computers operating system or so much of my computers processing power to the operating system them. So I was

still being an elitist computer snob in those days. Although I had to give in because more and more games were only Windows compatible, and if I'm going to be honest, that was my main concern with PCs back in the day. It wasn't so much concerned about the productivity software, but if I couldn't play my ultimate series of games got grouchy anyway. Remember it was also the year that the Mac Plus finally got discontinued from Apple. They decided to stop selling it, to stop making it. But it had

a four year run, so that was really strong. Now I've got more to say about this period in Apple and Macintosh history, but before I get to that, let's take another quick break to thank our sponsor. Within two years, so essentially By the time it gets to nine two Windows machines were outnumbering Macintosh machines by that factor of five to one, and that was super bad news for Apple.

Apple stock price suffered dropping twenty percent, so the the value of the company decreased by one five because of this issue and other issues going on in Apple, so the company was in a dangerous time in its history. It really led to an overall operational loss and it was pretty ugly. Stockholders were demanding that something change. So John Scully was on the way out at this point because the performance of the company was suffering. He was being blamed for a lot of that, and so he

left in three. But just before he left, Apple was still trying to right the ship right. The ship was starting to list. They were trying to get it back on track. I'm mixing metaphors, sue me. Apple introduced System seven, so this was the next generation of its operating system, and it introduced automatic support from multiple simultaneous applications, so

you could run numerous programs at the same time. It also introduced uh It's QuickTime software in n and Apple Max began to run on the Motorola six eight zero three zero processors. And I'm sure there's an easier way of saying that, and I'm sure the computer geeks out there in the audience who are familiar with these processors, these are the ones that you know, Max ran on the sixty eight thousand processors that Motorola made since the beginning.

I'm sure there's an easier way of saying them, and I apologize for not knowing that, but I'm just gonna say them the long way anyway. Uh. The Apple introduced the Macintosh Quadra seven hundred and the Quadrum nine hundred computers in nine, which were meant to be new product lines within McIntosh, although they didn't last very long. Uh. They ran on Motorola six eight zero four zero processors, which are comparable to the four A the six processors

that Intel was producing at the time. So you had Microsoft and Windows that were paired up with Intel, and you had Apple pairing up with Motorola, trying to make sure that its computers were of a comparable uh uh, comparable level of quality to the to the top of the line IBM compatible machines. Apple introduced a new type of computer called the power Book, which was a line of truly portable computers. These were more These were closer

to being laptops than that portable Mac was. Remember the portable Mac was really just a portable Mac, but the power Book was meant to be more of a laptop. The first of the power Books, or rather the the lowest in the whole line, the cheapest, was not actually made by Apple. Apple contracted with Sony, and Sony made the power Book one. This is unusual because most Apple products are manufactured by Apple itself, but that wasn't true

for the power Book one. The battery on the power Book one hundred would last a whole two hours without being plugged in. It didn't sell as well as some of the higher end models because it just didn't have the features. The power Book one forty and the one seventy were launched at around the same time, and they sold better than the power Book one hundred did. The form factor of these ended up kind of defining the

look of laptops in the future. So if you unfolded the screen, uh, the keyboard sat back toward the screen. So typically the way you would open up a laptop, and you know how the keyboard is back in the back section. In the front section, there was space for a first track ball, so again kind of like centipede ask your parents, and then later on a track pad,

which is what you find standard on most laptops today. Well, it was the power Book that kind of defined that form factor, and most laptops following followed along behind it. They didn't really change that up because it just made sense, but that was the power Book that really introduced that. Now beyond this, you also had in an alliance between Apple, IBM and Motorola. They called it the AIM Alliance AIM,

standing for Apple IBM, Motorola cute right. The aim of AIM yeakeniche mcadee doo was building new hardware and software to act as a platform for the next generation of computers and to stand as a direct competitor with Windows and Intel. So they wanted to make their own version of the partnership that Microsoft had with Intel and make it a competing standard. They called it PREP, which added an upper case P and upper case are, a lower case E and an upper case P. It stood for

power PC Reference Platform. I was intended to serve as that competitor, and the goal was to create a new operating system that Apple would be in charge of so Apple would provide the operating system and it would run on risk based processors as r I s C, and those would come from IBM and Motorola. Apple's code named operating system was called Pink. And why well, that goes

back a little bit earlier in Apple's history. So when Apple was planning out future projects several years before this happened, they would write down ideas on one of two different colors of note cards. If the idea was considered to be easy to implement, If engineers said yeah, we can knock that out and it won't cost too much and it won't take up too much time, those ideas went on blue note cards, meaning these are gonna be easy

for us to do. If it was considered a challenging idea that was going to require more time, more effort, and therefore it was going to cost more internally, they would write it down on a pink note card, saying, yeah, this is gonna be harder to do. It might still

be worth it, but it's gonna be hard. Well, the operating system was codenamed Pink because it was written down on a pink note card, creating the next generation operating system, one that wasn't rooted in the system versions that had been on Macintosh up to that point, was gonna take a lot of development time and effort, so it was codenamed Pink. Now, sadly Prep never really meshed. You never got a point where you had the hardware and software

married together to make this rival to Windows Intel. So ultimately the project was a failure. But one thing that did come out of it was a new type of processor called the power PC processor, and those would eventually find their way into mac computers. Apple introduced a line of Macintosh computers called the perform Aline, and this was Macintosh's effort to actually say, hey, let's make something for

the average consumer. Most Macintosh computers were so expensive and so specialized that they were just going to a narrow niche market. We're talking about those creators I mentioned earlier and small businesses, but that meant they were passing up the opportunity to really target personal computer owners. They had mostly targeted those through the Apple two line. But now the Apple two line was dead. It had discontinued, and uh really it ended in when Apple to E Enhanced

stopped being made. Although there were a couple of other variations in the Apple two that lasted a bit longer, but they wanted to tackle that same market with the Macintosh line, so they launched the Performance Series. So what was it. The Performance Series was really just rebranded older models of Macintosh computers. So the Macintosh computers that debuted a couple of years earlier but now had slower processors compared to the most up to date models, they got

rebranded as Performer models of Macintosh and put on the market. However, Apple dumped a whole bunch of different models at the same time, and that really confused consumers in the marketplace. Imagine going to a store and seeing eight different variations of the same basic computer and not really understanding what differentiated one from another. That's kind of what happened with

the Performance Series. It just added more confusion in the marketplace, and ultimately consumers just weren't sure about which computer they should pie, and not a lot of them got sold. So Apple decided, hey, let's clear up the confusion, and they produced a half hour infomercial explaining the different Performer models, and you can find it online. So if you've got half an hour to kill and you want to see how Apple tried to explain this performance series two consumers.

Search for it online, you can find it. It's usually divided up into multiple parts, but you can find in the performance series of videos that made up a half hour infomercial. Now, the next person to stepa in as leader of the company, remember Scully had left in ninety three, was Michael Spindler. He came from Apple's European operations division and he worked his way up the chain there. His term was one of real controversy. It wasn't as a

smooth transition, and it wasn't without issues. In fact, there were rumors that he was discussing the possibilities of a takeover with other companies like Sun Microsystems or IBM, and he also oversaw projects at Apple that ultimately failed, like Apple's Newton project. I know I've mentioned Newton in previous episodes of Tech Stuff. I think we might have even done a full episode about the Newton, which is kind

of a sad and comical story simultaneously. But that was the little handheld device that was meant to be able to recognize handwriting and other and have other features as well, that ultimately had um Its ambitions were beyond its own grasp. Let's be kind and call it that. But that's another story. So, uh,

the nickname for Michael Spindler was the Diesel. I don't know what that says about his character, but I have a feeling that I probably wouldn't be compatible with someone whose nickname is the Diesel, unless it was Kevin Nash, because we have a mutual love of professional wrestling. Now, Spindler would end up being replaced by the Board of directors a few years later in and the board of

directors chose Gil Emilio to step in as CEO. Gil Emilio had come from National Semiconductor before joining Apple, and Emilio himself would also get replaced by the Board of Directors in But more on that in a little bit. Let's get back to the timeline of Macintosh. So we left off in n just took a break to talk about the shuffle at the CEO level over the next couple of years, which really tells you that Apple was

in trouble. When you see a company changing CEO so rapidly because the board keeps replacing it, that's not a great sign. Doesn't show a lot of confidence at the board of directors. Level, and it probably reflects a lack of confidence at the shareholder level. But the show had to go on. So what was happening at Macintosh. Well, Apple made a big move that was a defining moment

and the Macintosh line. They decided to move away from those Motorola processors I talked about a minute ago, and switched to the power PC processors, which remember we're still developed partially by Motorola in partnership with IBM, so it's not like they were turning their back on Motorola. Rather they said, from this point forward, our architecture is going to depend upon this type of computer processor instead of this other type of computer processor. But that meant big

changes all down the line of the Macintosh. Now, they were hoping that the power PC processors would be able to rival Intel's x eight six chips. Those are the four eight six is the pen t M and so on. So that was the hope, and um they actually stuck with power PC processors all the way from two thousand six and then they changed again. That's a story for later now. The first mac to feature a power PC processor was the Macintosh, which also ran Mac OS nine.

It was the latest version of Apple's operating system. Although it wasn't called mac OS nine, it was really System nine. It was the first computer to actually run System nine. Oddly enough, Apple also released a second ver version of this specific computer with a completely different chip architecture. So you have the power Pc version of the sixty, but you also had an Intel for eighty six version of

the sixty. For the first time, Apple decided to try and go with an IBM compatible route, so this version of the Mac six had an Intel forties for six microprocessor. It was DOS compatible. It could run both mac OS and Windows simultaneously. Later on Macintosh users would have to do this by setting up a virtual machine that would run an instance of Windows over on top of the

Mac hardware. This was also a time when Apple began to stray further away from the concept of making as much in house as it could, and it was a big departure from the white Steve Jobs had run things back when he was still part of the company. Now, the power Pc hardware was incompatible with software that was written for Scintosh computers running the older Motorola chips. You often find this if you change processor types. That change in architecture requires software to behave a different way in

order for stuff to get done. So if you were trying to run an older Macintosh program on a power PC Macintosh, you had to have an emulator. This is a piece of software that simulates the way other hardware runs. You might remember I did one an episode all about video game emulators. The same thing is true for operating system emulators or chip emulators. So you had this software that was replicating the way old Motorola chips ran, but it would allow the software to run on a power

PC processor computer. In other words, you just had to have this other piece of software to kind of act as an interpreter so that you could get stuff done on your new machine. Now, the good news was the power PC's were so powerful, these power macs, as they came to be called, we're so powerful that it didn't slow down the processing of these older Mac programs. So the emulator wasn't so processor heavy that it was impacting

the way the program ran. It would actually run more smoothly on these power PC programs or power Pc machines than they would on the older Motorola machines. So that was a good story. Right. You don't want your emulator to slow stuff down, because then people get the implication that the brand new computer they just bought is slower than their old computer. That's a bad thing. So luckily the emulator ran really efficiently and it didn't slow things down.

That's when things kind of went bonkers over at Apple. For the first time ever, Apple licensed other companies to allow them to bring Macintosh compatible machines to market, so this was the era of the mac Clone. They allowed other companies to license the hardware and software and make their own versions of the Macintosh computer, although they would be called different things. Uh. This, by the way, ignores the fact that PowerBook one hundred was built by Sony,

but that was built by Sony for Apple. In this case, I'm not talking about companies that were building machines for Apple. I'm talking about companies that would license the technology to build their own version of the Macintosh and sell it

to consumers. The first was the Radius System one hundred from a company called Radius, and it was similar to Apple's own power mac The specs were very close, but the computer itself was housed in a tower style case, so very different from Apple's approach where they would try and put the monitor and the computer case all in one unit. That was typical for most of Apple's computers, not all of them, but a lot of them. This was totally different. It was more like your standard IBM

compatible where you had a tower desktop. So it was a big departure from Apple's aesthetic. Uh, there were other computers that also launched at this time that were clones of the Macintosh, because there were other companies that licensed the technology from Apple, and perhaps Apple was hoping to dominate the market again and make enough money off the licenses to justify their use. Unfortunately, Apple ended up cutting

off its nose despite its face. In this case, they licensed the technology to other manufacturers, but that gave companies the opportunity to produce cheaper machines running Apple hardware and software. So you could run Macintosh programs on these computers because they were clones of the mac not physically, but from a hardware and software standpoint, they were, and they were able to sell them for less expensive prices than what

Apple was demanding. So Apple ended up undercutting its own sales because it authorized these other users, these other manufacturers, to make Macintosh compatible computers. So why would you go and buy what appears to be an overpriced machine from Apple if you can go to one of its competitors and buy a comparable machine for much less money. If you are a consumer or a business, it makes more sense to go the other route, to go the cheaper route.

As long as you're reasonably sure that the machine is a good one, that's what you're gonna do. And in fact, that's what Apple saw. They saw a lot of consumers going to these competitors rather than going to Apple. Now, one benefit was that they had a lot more people buying into the Apple ecosystem, But because Apple wasn't controlling that hardware, they weren't seeing any money off of it, besides that initial licensing fee that they charged companies in

order to produce these clones. So in the long run, it ended up hurting Apple. It was hurting their sales, although it did mean that more people were getting familiar with the Macintosh program and the Macintosh platform because suddenly they could afford a Macintosh, even though it wasn't an

official Apple Macintosh. This is one of those decisions that Apple executives today probably look back on and shake their heads and mumble about it, because it really affected profits over at Apple by Apple was looking for the next generation of operating systems because Pink didn't work out. So they said, we need a next generation operating system. Our system series is starting to show its age. We need

a new operating system. But to spend the money and time to develop an in house is not really practical. So they started looking outside the company and saying, well, what else is out there that maybe we could acquire and then use in future Macintosh computers. They looked at two different companies, and here's the funny thing. Each of those companies was founded by a former Apple executive. The first company was b Incorporated. That's b E Inc. And

they created the bos or bios if you prefer. This company was founded by Jean Louis Gass, so remember the head of product development from a few years ago who stepped down. The other big contender was next Step, the next Step operating system, which was from a company called next and that company was founded by drumroll please Steve Jobs. So once again you had guess a versus Jobs with the two operating systems that could potentially power the next

generation of Macintosh computers. Now ultimately, spoiler alert, Apple decided that they would go Next. They decided against Bios and decided the next step was the operating system they wanted. So instead of setting up a licensing deal, they did something a little different. They didn't just license the technology from Next, they acquired Next. They spent a lot of

money doing it too. They spent nearly four hundred thirty million dollars on the purchase, and they threw in one and a half million shares of Apple stock as well. Now keep in mind Apple stock at this point was suffering, but it was one and a half million shares. If they could turn things around, and spoiler alert, they totally did, that million and a half shares of Apple would be worth way more money. So Steve Jobs came along as

part of this part of the deal. They essentially bought Steve Jobs back to Apple because he was the founder of Next and he was part of that company, so they acquired the company. Steve Jobs comes on so he would return to Apple after a very long hiatus or as he might refer to it as banishment, and he

returned initially as a consultant. But Apple was reeling. The stock price had hit a twelve year low and the board of directors had decided eventually that they needed to replace gil Emilio, and in fact, there was one person who was really arguing for this, and that person was Steve Jobs. So Steve Jobs goes to the board directors and says, hey, you are in real trouble. The decisions that have have been made over the past few years have been disastrous for this company and they are leading it

to the brink of bankruptcy. You gotta get rid of gil Emilio. And the board of directors agreed, and they put Steve Jobs in charge as interim CEO. But that stas wentn't last. Steve Jobs would eventually become the actual CEO, not just an interim CEO, and would end up taking control of the company he had co founded a couple of decades earlier. And uh yeah, it was a total different story Apple from that point forward. But that's the tale for another episode for part three of the Mic

of the Microsoft. For Part three of the Macintosh Story other m, my brain don't work, but yes, in part three we will talk about Steve Jobs return, how he transformed the Macintosh line yet again and leading up to the max that you would find in stores today. So that will be part three. Uh, that'll that should bring us up to date. I imagine unless I come across the story that's so incredible it takes yet another full

part by itself. In the meantime, if you guys have any suggestions for future episode topics or for guests I should have on the show, either as a guest host or an interview subject, let me know. Send me an email. My email address for the show is text stuff at how stuff works dot com. I keep getting emails sent to the genera at how stuff works dot com address asking what's the email address for tech Stuff. I only

say it at the end of every episode. It just tells me that you stop listening when I get to this part. Don't do that. Listen to the end tech Stuff at how stuff works dot com, or you can drop me a line on the social media's like Twitters and the facebooks at both of those. The show's handle is tech Stuff H s W and I'll talk to you again really soon for more on this and thousands of other topics. Because at staff works dot com,