Five Biggest Apple Mistakes

Apple is hitting on all cylinders lately, people are enthused about OS X and the switch to Intel. While the iPod, it almost goes without mentioning, is living in what amounts to it’s own cash rich ecosystem. Of course, things haven’t always been so great, it was a scant few years ago that the phrase “Apple Computer” and the word “beleaguered” seemed to be two halves of an inseparable, conjoined twin.

People who remembered the early days of Apple, when owning Apple stock was like printing money and Apple II’s were outselling every other computer around might wonder just what had gone wrong. How did the world’s biggest computer maker go from a market maker to a verifiable has been? They made some mistakes, some really big ones.

When talking about Apple mistakes, it is natural to mention the Lisa and the Apple ///. Those were mistakes, but they were of the quick and relatively painless kind. The Lisa sold so badly, for example, that the repercussions of that particular mistake didn’t last very long. Other mistakes are more insidious. At the time, the missteps seem like no big deal but as the clock ticks forward the mistake is amplified, those kind of errors are much more damaging long term than any failed product introduction. Restated for clarity, the G4 cube was released to rapturous reviews but sold like pancakes filled with bits of tinfoil. The cube, like the moment when tinfoil meets a filling, may have caused a jolt of short-term pain but no long-term detriment was suffered. Conversely, the mistakes that follow are still hurting Apple.

HyperCard

There’s a good chance you’ve never heard of HyperCard, but it was a fantastic program. It was a new way of managing information that relied on a note card metaphor. Users could enter information on the virtual note card and link pieces of the information to another card in the “stack.” Say you entered notes from a meeting on a card. In the notes you might have referenced the presenter and his name might have been linked to a card with his bio. So you could start with one card and magically, um, surf through a wealth of information. If you remember the first Myst, you’ve played with a really well executed HyperCard stack. As the most thick of us can see at this point, HyperCard would have made an excellent web browser. In fact, HyperCard was a large influence on the Hyper Text Transfer Protocol (or, more famililrly, HTTP).

While incredibly popular, HyperCard had a large strike against it, the program was free. In typical late eighties Apple management style the execs didn’t see a reason to pour resources into something that didn’t generate any revenue, so development languished. Compare this to Apple’s later tactics of introducing something for free (iMovie, iTools, iTunes) to derive a revenue stream once the program made Macs more desirable and users became addicted to the funtionality. Then you’ll start to see how badly HyperCard was mishandled.

Original Mac Pricing

Apple products, many opine, are horribly overpriced. People argue constantly if a Mac is really worth a few hundred dollars more than an equivalently equipped Dell. The disparity may seem large currently but, it is nothing compared to the price premium Apple used to demand.

It cost Appl $500 to produce the original Mac. Apple took a look at the price and decided to sell the thing for a cool $2500. That’s a 500% markup for those disinclined to do the math. Steve Jobs was against the pricing, he wanted to charge a paltry $1995 but, Apple President John Sculley overrode Jobs and used the extra $500 per to pay for the marketing campaign.

Marketing is undoubtedly crucial and the price did fund the much-loved 1984 ad. Still, there wasn’t even a hint of price competitiveness when the original Mac was released. Anyone who went to an Apple retailer saw a Mac selling for $2500 and an obviously inferior PC selling for less than half of that price. It was Apple’s chance to build market share, but the Apple’s management stymied the adoption of Macs by asking consumers to pay an exorbitant premium for their hardware.

The Apple II Upgrade Path

For a time the Apple II was the most popular computer in the world. Even though Apple was selling the machines hand over fist they were aware that the good times wouldn’t last forever, so they set out to design a next generation computer. They eventually came up with three: the Lisa, the Mac, and the Apple ///.

The Apple /// was the only computer that would run Apple II applications and it was a dog. Perhaps the worst computer Apple ever made the Apple /// suffered from a multitude of quality problems, many stemming from the fanless design (did someone say fanless? Yep, Steve Jobs was behind that move). The Apple /// was on the market for all of four months and sold as well as a horrid piece of junk could be expected to.

With the Apple /// gone, users were forced to stick with the Apple II if they wanted to save their investments in software. When people finally got tired of their Apple II’s and went to the store for a new computer they found that there was no model that would run its library of software. Both the Mac and the Lisa treated the Apple II as if it had never existed. Faced with the Mac’s price, the more familiar command line of the PCs, and the fact that either way they were going to have to shell out for new software, a lot of people chucked any Apple loyalty and opted for a PC.

John Sculley Licenses Mac OS to Microsoft

If you ever have the chance to ask a group of Applephiles who the first Mac licensee was they will tell you it was Power Computing. They’ll all be wrong and you can sit back and gloat. The first Mac OS licensee was Microsoft.

Apple gave Microsoft a perpetual license, royalty-free, to use some Mac technology. In exchange for this largesse, Microsoft would hold off shipping Excel for Windows and update Word for the Mac. As Vista has shown, yet again. Microsoft doesn’t view tardiness as a major problem but the license was a huge boon to Microsoft—It was free to develop its own version of the Mac OS.

Failure to License the Mac OS until the Moment was Past

Bill Gates wrote a pleading letter to Apple begging them to license the OS. The letter outlines several reasons why Apple should pursue the path and some partners they should approach. Apple, again with John Sculley at the helm, rejected the idea. Bill Gates, realizing that the GUI interface was the interface of the future decided to do what Apple wouldn’t, and he went about developing the best Mac OS rip-off on the planet.

It seems to have worked out for Microsoft. The usual rationalizations about Apple’s reluctance: companies saw hardware as the keys to profits, standardized OSes weren’t around yet, are well taken. Still, Apple was supposed to be the forward looking, cutting edge computing entity of that time and it missed its opportunity completely.

This is the moment when any article of this ilk must, seemingly, wax panglossian. After outlining mistakes, authors generally note that if not for those mistakes, we wouldn’t have slick Macs with OS X. Everything, after all, worked out for the best. That, as Voltaire noted, is the purest form of bovine excrement. It isn’t that everything worked out for the best, it’s just how everything worked out. One suspects that if Apple had a chance to call “do over” they most certainly would.