Steve Jobs

“Apple should license Macintosh technology to 3–5 significant manufacturers for the development of ‘Mac Compatibles.’” Gates got no reply, so he wrote a second memo suggesting some companies that would be good at cloning the Mac, and he added, “I want to help in any way I can with the licensing. Please give me a call.”
    Apple resisted licensing out the Macintosh operating system until 1994, when CEO Michael Spindler allowed two small companies, Power Computing and Radius, to make Macintosh clones. When Gil Amelio took over in 1996, he added Motorola to the list. It turned out to be a dubious business strategy: Apple got an $80 licensing fee for each computer sold, but instead of expanding the market, the cloners cannibalized the sales of Apple’s own high-end computers, on which it made up to $500 in profit.
    Jobs’s objections to the cloning program were not just economic, however. He had an inbred aversion to it. One of his core principles was that hardware and software should be tightly integrated. He lovedto control all aspects of his life, and the only way to do that with computers was to take responsibility for the user experience from end to end.
    So upon his return to Apple he made killing the Macintosh clones a priority. When a new version of the Mac operating system shipped in July 1997, weeks after he had helped oust Amelio, Jobs did not allow the clone makers to upgrade to it. The head of Power Computing, Stephen “King” Kahng, organized pro-cloning protests when Jobs appeared at Boston Macworld that August and publicly warned that the Macintosh OS would die if Jobs declined to keep licensing it out. “If the platform goes closed, it is over,” Kahng said. “Total destruction. Closed is the kiss of death.”
    Jobs disagreed. He telephoned Ed Woolard to say he was getting Apple out of the licensing business. The board acquiesced, and in September he reached a deal to pay Power Computing $100 million to relinquish its license and give Apple access to its database of customers. He soon terminated the licenses of the other cloners as well. “It was the dumbest thing in the world to let companies making crappier hardware use our operating system and cut into our sales,” he later said.
    Product Line Review
    One of Jobs’s great strengths was knowing how to focus. “Deciding what
not
to do is as important as deciding what to do,” he said. “That’s true for companies, and it’s true for products.”
    He went to work applying this principle as soon as he returned to Apple. One day he was walking the halls and ran into a young Wharton School graduate who had been Amelio’s assistant and who said he was wrapping up his work. “Well, good, because I need someone to do grunt work,” Jobs told him. His new role was to take notes as Jobs met with the dozens of product teams at Apple, asked them to explain what they were doing, and forced them to justify going ahead with their products or projects.
    He also enlisted a friend, Phil Schiller, who had worked at Apple but was then at the graphics software company Macromedia.“Steve would summon the teams into the boardroom, which seats twenty, and they would come with thirty people and try to show PowerPoints, which Steve didn’t want to see,” Schiller recalled. One of the first things Jobs did during the product review process was ban PowerPoints. “I hate the way people use slide presentations instead of thinking,” Jobs later recalled. “People would confront a problem by creating a presentation. I wanted them to engage, to hash things out at the table, rather than show a bunch of slides. People who know what they’re talking about don’t need PowerPoint.”
    The product review revealed how unfocused Apple had become. The company was churning out multiple versions of each product because of bureaucratic momentum and to satisfy the whims of retailers. “It was insanity,” Schiller recalled. “Tons of products, most of them crap, done by deluded teams.” Apple had a dozen versions of the Macintosh, each with a different confusing number, ranging from 1400 to 9600. “I had people explaining this to me for three weeks,” Jobs said. “I couldn’t figure it out.” He finally began asking simple questions, like, “Which ones do I tell my friends to buy?”
    When he couldn’t get simple answers, he began slashing away at models and products. Soon he had cut 70% of them. “You are bright people,” he told one group. “You