Haunted Empire: Apple After Steve Jobs Read online

  Every WWDC was important, but the 2008 meeting was particularly so because Apple was about to launch the App Store. The company needed to get developers excited about submitting apps. More than five thousand people would be attending, and many more would be following the event through blogs and media reports. Jobs needed to win over every one of them. To help him, he was inviting a few developers onstage during his keynote address to showcase their apps.

  First, however, Jobs was vetting their presentations personally. He wasn’t about to allow Apple’s carefully crafted image to be bruised by technical glitches or a developer who stumbled over his words. The developer relations team had spent the last several weeks choosing the final candidates. After they had spent a couple of days refining their apps and polishing their two-minute demo scripts behind closed doors at Apple’s offices, the time had come for the developers to show Jobs what they had. The speakers had said their lines dozens of times, but this would be their biggest test yet.

  Everyone knew Jobs was a perfectionist with a fiery temper. Making a presentation in front of him was a challenge, even for veterans accustomed to his acid tongue. “What the fuck is that?” Jobs would ask when he saw something he didn’t like. It was rare for someone to actually reach the end of a presentation without Jobs jumping ahead to the conclusion or going into a tirade. “Your communication is so poor that I can’t even tell what you’re talking about,” he once told someone who was giving him a private demonstration. “Until you guys figure out how to communicate, I don’t know how we can even have a discussion.”

  As Jobs’s intense brown eyes bore down on them, speakers stood onstage to practice their lines. The wait to rehearse in front of Jobs was torturous. One of the staff members tried to put the presenters at ease. “Don’t worry,” he said. “Steve’s a normal guy. He puts his pants on one leg at a time.”

  It didn’t reassure anyone. A mistake at any point could cost the presenters their slot. When their turn came, speakers entered the auditorium and walked down the aisle, passing by Jobs. The air crackled with tension.

  “Is yellow eBay’s corporate color?” he asked after its speaker finished his spiel. He didn’t like the color in the app, but when the answer was yes, he backed off. Occasionally, he’d provide small suggestions directly to the speakers, asking them to emphasize a particular point or change something on their app.

  Most of them were prepared, thanks to the intense coaching from Apple’s team. Jobs, in a benevolent mood, smiled and told them they’d done a great job.

  As the teams finished, they felt the weight slide off their shoulders. There would be two more dress rehearsals before they would make it onstage, but they had survived an encounter with Jobs, and they were elated.

  That day, the developers were too focused on themselves to notice that the CEO was looking frail and gaunt.

  Only fifty-three, Apple’s savior had already conquered much of the modern world—transcending the computer industry and redefining industries as varied as retail, music, and mobile phones. It was hard to believe he was mortal. Even in his daily life, he defied the natural order. The fact that he drove without a license plate demonstrated how he soared above the everyday concerns of his fellow humans. He got away with it by leasing an identical car every six months, within the grace period California state laws set to obtain plates for new cars.

  Apple would never have been created or resurrected without Jobs, and it was difficult to imagine the place continuing to thrive without him. Through the years, the company’s hopes and aspirations had become completely intertwined with his continued success.

  Apple had been officially founded on April Fools’ Day in 1976. A twenty-one-year-old Steve Jobs and his twenty-five-year-old friend Steve Wozniak started their computer business in the garage of Jobs’s parents’ home in Los Altos, California.

  Jobs had a vision of computers as mental bicycles, a tool that helped make the most of a user’s intellect in the same way that bicycles helped make the most of a rider’s athletic ability. But the board of directors considered him too inexperienced to manage the company and asked him to hire a CEO. When he found John Sculley, a former PepsiCo president, he recruited him with the famous words:

  “Do you really want to sell sugar water for the rest of your life or do you want to come with me and change the world?”

  The following year, Apple launched the original Macintosh. An infamous sixty-second television spot on Super Bowl Sunday declared the company’s intentions, depicting a female runner bursting into a drab room and hurling a sledgehammer at a huge screen projecting Big Brother. In an Orwellian reference to IBM’s dominance, a male voice intoned, “On January twenty-fourth, Apple computer will introduce Macintosh. And you’ll see why 1984 won’t be like 1984.”

  The next week, a proud Jobs stood on the podium at Apple’s annual shareholders’ meeting in a dark suit and bow tie and pulled its newest computer out of a bag. As the computer turned on and showed all the things it could do, the theme song to Chariots of Fire played in the background. Then the machine spoke. “Hello, I am Macintosh. It sure is great to get out of that bag.” The audience went wild, and a cult was born.

  But that would be Jobs’s last moment of glory for a long time. His disruptive behavior and pursuit of perfection at all costs had wreaked havoc on the company, and the executive team wanted him out. A little over a year later, he was in exile.

  Under Sculley, Apple flourished for many years as consumers paid a premium for the Mac’s unique mouse-based point-and-click user interface. But when Microsoft’s Windows software caught up and exceeded the Mac’s features, the kingdom crumbled. PCs running Windows soon proliferated, and Apple’s market share shrank.

  By the mid-1990s, long after Sculley had left and his successor had come and gone, Apple was on the brink of bankruptcy, forced to cut prices and add new product lines to sustain its growth. The company was selling dozens of computer models that were confusingly similar but had incompatible operating systems. Employees began jumping ship. Three days after Gil Amelio, the former CEO of National Semiconductor, took over, BusinessWeek published a story with the title “The Fall of an American Icon.”

  Amelio was in way over his head. Apple needed a leader who could take extraordinary measures at breakneck speed, but Amelio was a classic, hands-off corporate executive, who preferred to supervise rather than take action himself. He hired image consultants, created new acronyms to describe business concepts, and put together white papers. He was also a bad fit culturally. He cared about executive perks and liked formality. He drove a Cadillac Seville and always ate his lunch on china. His executives mockingly called it “Gil’s special china.” According to rumor, it was Wedgwood. Each day one of his assistants had the unenviable job of taking his meal out of a takeout container and plating it.

  For all the criticism about his tenure, Amelio had made one of Apple’s most critical moves—the decision in December 1996 to buy NeXT, Steve Jobs’s failing computer company. As part of the deal, Jobs became Amelio’s advisor.

  Amelio’s tenure unraveled quickly, accelerated in part by a scornful Jobs, who had plenty to say about Amelio’s management decisions behind his back but offered little advice. He attended one executive team meeting, but he walked out in the middle of it and never returned. At a dinner party to celebrate the sale of NeXT, Jobs joked about creating a “Gil-o-meter” to gauge stupidity. “Two Gils” meant someone was being twice as stupid as Amelio.

  After a famously disastrous Macworld speech in January, where Amelio was upstaged by Jobs, the CEO lost the board’s confidence. During his short reign, Apple had lost more than $1.6 billion. The company was so undesirable that no one even wanted to buy it. Its brand name would maybe fetch $500 million.

  After the board begged him to return, Jobs overhauled the company’s culture. During his absence, Apple had fallen into complacency as everyone took more interest in celebrating their accomplishments than breaking new ground. There were team T-s
hirts to commemorate new projects and a garden of Macintosh icon sculptures and a display of an old Apple I to remember the company’s past successes. Employees took six-week sabbaticals every five years.

  That changed overnight. Jobs ordered the mementos removed and the people on sabbaticals recalled. He forbade hard liquor, smoking, and pets, and replaced Amelio’s china with ordinary cafeteria dishes. He did away with anything that he perceived as corporatized and installed a meritocracy that rewarded agility, ambition, and boldness.

  “The lunatics have taken over the asylum, and we can do anything we want,” Jobs joked shortly after his return.

  Accustomed to a more laid-back work environment, many people left the company voluntarily. Others were fired. Stories circulated about Jobs going into meetings and terminating people on the spot. A rumor started that he had fired someone in the elevator. When a protective covering went up in the elevator of IL1 to shield it from construction work, one person quipped: “This must be Steve’s elevator since it’s padded.” To which a colleague asked, “Is it for him or for us?”

  At some point someone made up a verb to describe such unfortunate outcomes: Steve’d.

  Jobs also clamped down on secrecy. Outgoing email was monitored, and anyone caught sending messages labeled “confidential” received a warning. Employees, who were accustomed to wandering through open doors, were suddenly prohibited from entering many areas. Office windows were mysteriously covered, and engineers were asked to work on projects without knowing what the product was. Everything was on a need-to-know basis.

  This was a complete turnabout. Jobs had once leaked so many corporate secrets that a colleague once teased him, “It’s a strange ship that leaks from the top.” But he had learned the power of mystery. If Apple had any hope of surviving, it needed to stay nimble and ready to modify its strategy without being hampered by public opinion. Product introductions were also more dramatic when no one knew what was coming. The media attention he received for them was worth millions of dollars in free advertising. Jobs loved the moment of revelation when he introduced a new product that no one in the audience had seen before.

  In Jobs’s first months back, some employees rebelled. A prankster forged Jobs’s email address and sent out a memo. “You’ve all become lazy and only contribute to Apple’s current situation,” he wrote, according to one account. “You’re now going to have to pay for the water in our water fountains and we’re going to add a charge that you’ll find on your paycheck for the oxygen that you use for your eight hours on the job.” He added that employees would be charged three dollars a day for parking. “Only I will be allowed to park in handicapped spaces,” it said, making fun of Jobs’s well-known habit.

  Twenty minutes later, the real Jobs sent out an email.

  “I’m all for having fun,” it read, “but we need to be focused on the future in making the company a better place. Best, Steve.” The culprit was fired.

  In September 1997, Jobs finally agreed to update his status from advisor to interim CEO. Though he wouldn’t be ready to permanently commit to Apple for another two and a half years, he started the hard work of rebuilding Apple, killing unprofitable projects and ridding the company of deadwood. He surrounded himself with brilliant lieutenants. Two of them had been with him since his NeXT days. Another two had been at Apple since the previous regime but had impressed Jobs with their eagerness to transform the company. Among his new hires was Tim Cook, who was put in charge of streamlining Apple’s operations.

  Before Apple could put any more products on the market, it needed to brush up its severely tarnished brand image. To do that, Jobs engaged the creators of Apple’s “1984” ad at TBWAChiatDay. This time, they came up with “Think Different,” which would go down in advertising history as an unparalleled campaign. Instead of showcasing its products, the ad associated Apple with history’s geniuses, cementing its identity as an innovator. If the company’s vision was murky before, this clarified it: Apple made products for people itching to change the world.

  Once the company reestablished its brand and provided a visionary framework for its future products, Jobs pared Apple’s product lines from dozens to just four: one set of desktop and laptop computers for professionals and another for consumers.

  The gumdrop-shaped, partially translucent iMac led the charge. Its unique, fashionable design put Apple back on the industry map. In 2001 Apple opened its first Apple Store, creating a completely new electronics retail experience that invited customers to hang out and try its products. The iPod digital music player and iTunes came next.

  Each successive hit increased the mystique around Jobs. By this time, he had perfected the art of secrecy and the only facts that the public knew about him were what he wanted them to know. He used that to cultivate an image of himself as a charismatic superstar who answered to no one but himself. Before long, he became the most recognizable figure in business. He wore the same outfit—a black turtleneck, Levi 501 jeans, and New Balance 991 sneakers—until it became his trademark.

  But in October 2003, the unthinkable happened. Jobs was diagnosed with pancreatic cancer. The initial report was bleak. He was told that he had three to six months to live, and he should get his affairs in order. A biopsy later revealed that he had a rare kind of treatable cancer, but it was still cancer. As Jobs broke the news to his executive team, he cried.

  Jobs considered disclosing his illness to the public but changed his mind. He didn’t want people to view him as a helpless patient. Besides, once he disclosed information about his health, it would be irretrievable. The brouhaha that would ensue would be an intrusive distraction. His lawyers determined that it wasn’t a problem as long as Jobs was able to serve as CEO.

  Jobs made his recovery difficult. Though doctors advised surgery, he ignored them because he didn’t want them cutting into his body. He pursued an alternative treatment through a vegan diet, acupuncture, and herbal remedies. “Voodoo medicine,” Jobs’s friend and board member Bill Campbell called it. A few people who worked with him closely noticed his flagging energy and his unusually eccentric diet of juices and broths. Only his innermost circle knew what was wrong. Those who brought attention to it were told to forget that they had noticed.

  By July of the following year, however, Jobs wasn’t getting any better, and he underwent surgery at Stanford University Medical Center to remove a part of his pancreas. The following day, he sent out an email to employees. “I had a very rare form of pancreatic cancer called an islet cell neuroendocrine tumor, which represents about 1 percent of the total cases of pancreatic cancer diagnosed each year, and can be cured by surgical removal if diagnosed in time (mine was).”

  The email wasn’t entirely truthful. Jobs neglected to explain that he had been diagnosed nine months earlier. While it was true that Jobs’s kind of cancer might have been cured by timely surgery, he had waited too long. During the operation, doctors found three liver metastases. But that fact was kept quiet, and Jobs’s protectors closed ranks. Campbell told a reporter that the board didn’t think it was necessary to disclose the timing of his diagnosis because Jobs had been working right up until his surgery. A question about Jobs’s sick appearance at WWDC one year was laughed off.

  “I wish someone would comment like this when I lose weight,” Campbell joked. An Apple spokeswoman pointed out, “He’s six feet tall and weighs 165 pounds. It’s a healthy weight for his height.”

  Jobs supported the storyline, telling everyone that he had been “cured.” In June of the following year, he gave the commencement speech at Stanford University that addressed his mortality. “Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life,” he said. “Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.”

  Jobs began working even more feverishly. After two years of intense devel
opment, Apple launched the iPhone in 2007. Unlike the typical cell phones of the time, it was a sleek and elegant phone with a large rectangular touchscreen and a button. Users could check email, surf the Web, play music, and perform many other functions with the touch of a virtual button or a swipe of a finger. A simple interface made it delightfully accessible to even the most technology-shy consumers. As with its other products, the iPhone pushed the envelope in design. Some dubbed it “the Jesus Phone.”

  Apple made history again. There was much excitement in the company about how it could follow this promising debut. The App Store was just one of them.

  But once again, Jobs’s health was interfering.

  The cancer was affecting his body, and he was in increasing pain. Morphine helped, but it reduced his appetite and added to digestive problems stemming from his first surgery. He had trouble keeping food down. He told one friend that “when he feels really bad, he just concentrates on the pain, goes into the pain, and that seems to dissipate it.” That spring, while the company prepared for WWDC, Jobs had lost forty pounds.

  His executives watched him wither even as they pretended that everything was okay.

  In the week before the developers conference, Jobs was running a high fever. But the focus of discussion among the planning staff was on his appearance. The CEO’s keynote was a marquee event at WWDC, and everyone would be paying close attention. It was unlikely that the audience would overlook his weight loss. As a solution, someone proposed that Jobs wear two turtlenecks. The idea was discarded in part because no one dared to suggest it to him.

  By 7 a.m. on the first day of WWDC, the line already stretched around the corner of the Moscone Center in San Francisco. Jobs’s keynote wasn’t due to start for another three hours, but his disciples arrived early in the hope of getting a prime seat. Many had traveled from around the world. The long-distance travelers stood out because they weren’t dressed for the Bay Area’s chilly summer. While the locals came prepared in long-sleeved shirts or jackets, the out-of-towners shivered in short-sleeved shirts and jeans or shorts. A classic tourist mistake.