Apple and NeXT, 25 Years Ago this week
blog.hayman.net
blog.hayman.net
It's very rare that you see acquisitions work out like this. Apple traded away about 13% of their 1996 market cap to buy NeXT, and then allowed NeXT's leadership to take over and run the place. Most M&A stories like this usually result in massive underperformance for shareholders. Instead, Steve Jobs turned NeXTSTEP into OS X and iOS, driving an incredible turnaround.
People like to point out that this merger was different because of Steve Jobs and his history with Apple, but I don't think that's so obvious. Neither Apple nor NeXT were strong companies at the time, and Apple's culture had drifted considerably since Jobs was fired in 1985.
For anyone who has been involved in a big acquisition integration, it can be like pulling teeth to get a buyer to properly adopt the target's technology. There are always barriers from the junior engineer all the way to the CEO. While it certainly helped that Jobs was the original founder, even that was no guarantee of success. Jobs had learned a lot running NeXT and Pixar, but that was not obvious at the time. I imagine there was a lot of internal resistance within Apple.
This acquisition probably would have failed miserably anywhere else, and yet Jobs and Apple made it one of the best ever.
The result was what Apple needed to compete. A modern OS made of with a modern UI with XNU that had memory protection that can compete with Windows. Also a transition VM for older software.The iMac broke away and showed that computers could look cool.
The iPod showed Apple could make compelling Consumer electronics XNU got adopted with the iPhone iPad and with what they learned with the iPod.
And moving Apple to Intel and then to Apple Silicon was similar to going from MacOS 9 to 10.
Not many companies can claim so many innovative devices and most get 2 or 3.
I don't know if the iPod used XNU. Using the same kernel as OSX in mobile was first adopted with iPhone by the Scott Forstall team in lieu of a custom mobile OS approach by the Tony Fadell team.
Before Jobs came back Apple's product strategy was a shitshow. They were selling the same machine under different names in different markets, selling 68k machines years past their "fresh by" dates, had a just plain confusing naming scheme for products, and were keeping money losing divisions open.
Cutting things like the Newton and printers and simplifying the Mac product lines was a huge improvement. The iMac replaced a dozen different confusingly named Performas and PowerMacs all in the same category. The G3 PowerMac replaced all the other higher tier machines. The PowerBook was also rolled into a single model with different upgrade options. Once the iBook was released the 2x2 product matrix was straightforward and sane.
The iMac was the most visible part of that process but the other hardware lines were consolidated at the same time and in the same way. Had that all not happened the iPod couldn't have existed. Even the iPod wasn't a runaway success until the third generation that supported USB 2.0. The first two generations were FireWire only and even when Windows support was added still required a FireWire card in a PC which basically only came in Sonys (4-pin FireWire branded i.Link to avoid the license fee). The third generation supporting USB really opened the iPod market to Windows users. The iPod was already making money by then but the explosion of sales starting with the third edition turned it into a money printer.
Jobs' "innovation" in this era was to slash slash slash Apple down to the bone and implement a Dell-like just in time delivery model.
Apple was still in some trouble, market wise for at least 5-6 years after Jobs returned. They also didn't ship the NeXTstep based OSX until 2000/2001. My wife worked in marketing there from 2003-2010 and we saw it first hand. In the end what transformed Apple from a marginal company 'in trouble' was the iPod.
Apple stopped being a computer company and became a consumer electronics lifestyle brand. Their actual computers are still fairly marginal in the market and last I looked not a major profit centre. They make their real money on iPhones and paraphernalia.
Insofar as NeXT's tech has helped Apple it's just that they've had a portable operating system that they could move between ISAs and form factors. That isn't unique to NeXT/OpenStep, it could have come from somewhere else, including BeOS.
NeXTStep was not just a portable operating system.
The Smalltalk-based runtime environment, that programming API was far more effective than anything Apple had at the time. And the WinTel PC still had some work of its own, before Microsoft client-server corporate apps could deliver.
The other big thing that NeXT brought back to Apple was a culture of very effective, small engineering teams. Clearly there are limits to that, but this management style was well-placed to make virtue of necessity, desperation.
Apple survived by becoming leaner and more lifestyle focused. Maybe your last point applies, and maybe Jobs learned this management lesson and others through his startup time at NeXT, I dunno.
But more than anything I think Apple's revival came through dramatically shrinking product lines, cutting fat, and focusing on just in time production. Unfortunately in the process a lot of interesting tech was also thrown away (Newton!)
And none of that shift was technology. NeXT vs BeOS would not have made a difference on the relevant time scale.
But we love to nerd out of the tech, and Be had some wonderful stuff. Love their filesystem, their interrupt handling, dang the PowerPC could destroy Intel in context-switch latency speed... What an awesome Jeff Goldblum ad campaign that would have been!
Pour one out for BeOS. And Dylan. And Newton soup... But as I consider tech details, again most of the good ideas did not die. ARM handheld hardware, dynamic but typed TypeScript, tuple-space data message passing noSQL soup. After a while, you see the bits and get that familiar feeling.
NeXT also ported to the HP PA-RISC platform, that grew out of their relationship with NeXT NetObjects (or whatever their object-based RPC architecture was called) on HP Enterprise servers. But I've never met anyone who actually ran NextStep on an HP Gecko.
> the iMac, which used zero NeXT expertise and ran Mac OS 8 or 9.
I’m also reminded of Sun’s near-acquisition of Apple (apparently multiple times), which McNealy(?) later acknowledged would never have worked out so well.
Jobs gets a lot of grief here and elsewhere for his personal failings and management style, but this was an epochal moment in the computer business. I remember roughly at the same time dreading what seemed like the inevitable Windows victory over all of personal computing.
I can't imagine BeOS going in the same direction. Macs would have been increasingly PC-like - but with a much nicer OS, and maybe brightly coloured plastic [1] instead of beige - and someone else would have eaten mobile.
I suspect BeOS Macs would have ended up more like the Amiga - an item of nostalgia. Apple would likely have been sold off within a couple of years.
[1] Probably purple.
https://www.businessinsider.com/steve-jobs-larry-ellison-201...
From what I remember reading, it was only because JLG wanted too much money that the whole thing fell apart.
I don’t have a source. Maybe JLG said as much himself somewhere at some point on an interview or book :-)
Those were the halcyon days for software engineering. Programmers called the shots because the "users" were them. An engineer knew what features to add because it is what they wanted. Upper management could let the cowboys run a little loose because shipping software was like printing money.
These days the stakes are much too high and the customer is everyone. I see this causing management to be hamstrung by accountability. To help accountability, more and more process is layered on, loose cannons weeded out....
Culture is nothing like it was two decades ago.
The acquisition was a normal acquisition.
What made it special was the DOJ stepping in to destroy Microsoft because Bill Gates was essentially too rich and his riches were so talked about that people in DC wanted to show him who's the alpha.
Apple would have gone to zero without Microsoft essentially saving it from bankruptcy, and it would be irrelevant had the DOJ not attacked Microsoft with such vigor.
That is revisionist. Microsoft got a slap on the wrist. I don't think this gave Apple any tangible benefit. Microsoft's investment was also insignificant. The only thing that really mattered was Microsoft's commitment to continue delivering MS Office for Mac OS. That was a big deal. MS got benefit from Explorer on Mac and for the continued "competition" from Apple to reduce antitrust accusations.
That investment and commitment helped Apple keep going long enough to get out of the bind it was in.
Microsoft gave small users everywhere a free license to use the best GUI OS in the world. Not to mention the browser and the productivity tools
It has always been a free software , unless you are really dedicated and want to pay for it.
It was a really elegant solution, the degree to which you paid for Microsoft products ranged based on each individual user willingness to "look around" for free pirated copies.
And over at Redmond they'd take notice and push the bill onto paying customers such as the Fortune 500 (Exxon, BP, JPMorgan)
If there is one company that the public should love is Microsoft.
> If there is one company that the public should love is Microsoft
Microsoft was a monopolistic and mediocre behemoth in the 90s. We’re lucky computing survived its grip. Mostly due to the open web, which is sadly under severe attack.
> It has always been a free software , unless you are really dedicated and want to pay for it.
The only way I can see for this claim to have any connection to reality is if you are talking about piracy. Yes, Microsoft kind of turned a blind eye to pirates if they stayed small-scale enough. Yes, it was still illegal, and you were still (at least theoretically) running the risk of legal trouble.
If you weren't talking about piracy, then you are simply wrong. Microsoft was never free. (You may have been paying it bundled into the price of a new computer, but it wasn't free.) This goes all the way back to the beginning - see Bill Gates' letter to the hobbyists who were taking a "free license" to MicroSoft BASIC back in the 1970s.
That's totally not how that happened. Microsoft was doing things that were legitimately anti-competitive, and legitimately against the law. That got proven, and Microsoft's best option was to take the consent decree rather than flat-out lose and let the DOJ have a free hand to write the rules going forward.
Antitrust laws were made to protect the consumer, the same consumer which was robbing Microsoft blind because they allowed piracy.
But Apple was not prohibited from including other browsers as well. For example, years later, Safari.
The worst thing is that the majority of the American population would have not found themselves competing against Bill Gates for anything, except those in DC who had him as their #1 enemy in order to win their size measuring contest.
Matter of fact the small individual consumer and small businesses were getting away robbing Microsoft blind as they didn't do anything to stop piracy.
Microsoft would just treat it as free marketing or just pass those losses onto big paying customers such as the Fortune 500 companies, thus compensating for piracy losses at the base of the pyramid.
After DOJ intervention nowadays we have Apple shipping a 1700$ phone which is completely closed off and out of the box is impossible to charge while listening to music at the same time. Irony if you think about how passionate Jobs was about music
Microsoft didn't win on technical merit, they were winning because they were aggressively anti-competitive.
Give away your product for free. Now it’s practically impossible for your competitors to sell enough to keep going when there’s a free product out there.
That’s EXACTLY what killed Netscape.
There wasn't an organic hatred against Microsoft, people were teaching courses on how to create a startup aimed at getting acquired by them and retire early.
It was a DC play from people who knew nothing about software but were jelous of what they were reading on Fortune and Forbes.
And consumers were harmed by one company controlling 97% of the desktop market, when its would-have-been competitors had better product but couldn't compete because it cheated.
When the 97% is potentially all free, then I don't where's the monopoly, unless you also include in the definition of monopoly having a special place in people's hearts after you gave them such gift.
People made a choice to pay for convenience, but if you looked around you'd find ways to get Microsoft products for free.
Are you saying that because people didn’t have to buy Windows for their computers since it was included?
They paid in directly. You’d buy your computer for $2000 and Microsoft would get $350 (or whatever). Because of the price Microsoft charged, the price of your computer with artificially high. Because of Microsoft agreements with computer makers, you couldn’t choose NOT to buy Windows. So you had to pay the money. Since you had to buy Windows, there was no price competition.
Even after the antitrust settlement this was still a problem. Remember when netbooks were the fad? Well it’s really hard to sell a $500 laptop that’s good if you’re required to pay Microsoft $250 for Windows. That’s why we actually saw ones that shipped with Lenox. In competition, Microsoft released a cut down version of Windows that was limited that they charged less for.
What do you know, competition worked. That couldn’t happen before the settlement.
Even the base model iPhone SE ($399) has an external speaker, bluetooth, and airplay, all of which are capable of playing music while charging at the same time.
What a strange complaint to make, and it’s even stranger to tie it to your even stranger take on the DOJ and Microsoft.
Had the DOJ not attacked Microsoft we'd have a better, more open phone which would also come out of the box with the ability to play music while charging.
iPhones made in 2012 were only barely better than Pocket PCs made in 2005
Evidence is also how the iPhone struggle to communicate with Windows PCs and everything which isn't Apple.
Evidence is also the fact that out of the box you cannot charge your 1700$ phone while listening to music at the same time.
I used it. Everything from the original version that came on little tiny palmtops (Windows CE) to the near final version on things like the compact iPaq.
As a geek I found it interesting, but realistically it sucked.
It was eventually available on some of the early smart phones. It had its chance. It failed. Microsoft kept reinventing it trying to fix it, and it never worked. People preferred the “inferior“ PalmOS.
There’s a reason the iPhone came in and ate everyone’s lunch.
Microsoft had a chance. They were competing. They made changes. They rewrote the UI numerous times. They lost. BAD.
The idea that the Pocket PC was better than the iPhone is demonstrably, by sales, wrong.
The idea that the Pocket PC failed somehow because of the Microsoft antitrust settlement with the government… I don’t understand that one.
That you continue to repeat this, despite it being clearly disproven above, is telling.
Where are the airpods? Not even the last model, even 2017 Airpods.. you know just to provide some aftercare to the customer after screwing them so badly
Still, for most people it's not their first such device, so they already typically have their own infrastructure of chargers and BT headsets etc.
At the time I had an Intel pII Xeon desktop from Dell that had a nvidia monster video card and turtle beach sound card. Oddly enough, the processor, video card, and sound card were all compatible with BeOS so I had an unofficia x86 BeBox. The official BeBox was a PPC box.
BeOS was chosen to be the successor to MacOS 9 until the 11th hour, when a meeting with Jobs and the board of Apple met. BeOS was dumped almost immediately for NeXT that night.
BeOS was a completely new operating system while NeXT was based on a Mach OS BSD base (later to become Darwin BSD).
Be Inc fell apart and sold to 3Com, which sold to HP eventually and there it was neglected and mothballed. Haiku came out later to try and bring the project back, but at the time of Haiku's release Be was already over a decade old and the code had not kept up.
There was so much momentum in the BeOS world before the 3com acquisition that was stifled and killed.
Now this period of time is often referred to as "When NeXT bought Apple with Apple's money."
Somewhat. Be's CEO way overplayed their hand and left the door open for Jobs (or anyone else) to come in and steal their opportunity. Which is exactly what happened. The internal valuation Be had of themselves was completely delusional, as just a few years after the Apple-NeXT merger showed.
It's too bad. BeOS was a thing of beauty. I still have fond memories of it.
At every step Apple was a few months from being bankrupt and useless. Because Dell/Google/HP/RIM/Sony/whoever would undercut their CLEARLY overpriced product and their sales would evaporate.
At some point in the last five to seven years you started to see if you were in fewer of those takes. In 2018 Apple became the first trillion dollar company and somewhere along the line the “Apple‘s going to fail any day now“ meme died. It’s very clear Apple is here to stay.
But don’t worry. Every product is a failure. After all Steve Jobs died and the company can’t work without him. The iPad was going to be a failure. The Apple Watch was going to be a failure. The AirPods were going to be a failure.
So don’t worry. There’s still tons of Apple pessimism available. It just changed targets.
In 08-10 the accounting for iPhone sales (GAAP? I don't recall the details, just regurgitating what I read at the time, had something to do with the way the devices were subsidized) seems to have not yet made it obvious how much money Apple was printing. I knew from following people much smarter than me that I should be investing all my money in Apple stocks, I just didn't have any to invest.
The iPhone 3GS took off quite well, but I’m not sure it was really clear to people just how big of a juggernaut it was until the iPhone 4, especially when it came to Verizon.
and it's funny how quiet things are now. Toyota just announced they aim to be producing 3 million EVs by 2030. That will put them about 6-7 years behind Tesla.
All quiet.
I think it was fair to question Tesla. The Roadster was ultra low volume. The S was pretty low volume and high price (limiting potentially sales). Good, but still small. The X had a lot of problems during development and still not too high in volume due to price.
Finally getting the 3 out the door after all the delays and the tons of orders that came from that were the thing that seemed to cement them as not going to fail at any moment. I mean Musk has explicitly said they came REAL close to the end trying to get the 3 out, so it was somewhat fair.
In contrast with Apple the doomsaying continued for at least 10 years after they were very safe.
Seems a rather different to me.
No. 3Com spun off Palm in 2000. Palm bought Be in 2001. Palm then spun off its software division as PalmSource, which was later purchased by ACCESS. So ACCESS owns BeOS, not HP.
Is that the Diamond Monster 3D? I thought those were 3Dfx Voodoo only?
[0] https://www.goodreads.com/en/book/show/226316.Steve_Jobs_the...
[1] https://github.com/oxidecomputer/twitter-spaces/blob/master/...
NeXT was attempting to bring OOP programming to the masses, along with some really excellent for the time (and even now) rapid development tools.
Try some of the applications (FrameMaker, Mathematica, IB, etc) on NeXT. Then try the equivalents on Sun (which they were holding up as the exemplar in that audio chat), not even in the same ballpark.
They actually got very good traction in financial services and a few other areas. Just too late.
As for the hardware, they were 3 years too early for what they wanted to do. Had they held in until 1996 they could have had a fast enough machine for the price target they wanted. (Say 100mhz, 32meg ram, ~gig disk, high res colour).
Edit: Of course it turned out NeXT was right once they got a large enough market for it when they acquired Apple.
[1] https://hardcoresoftware.learningbyshipping.com/p/009-passwo...
Half way through the bottle one of them said "You know what? We could build Smalltalk on top of UNIX!". and thus was born obj-c and Nextstep.
There are still things that nextstep is more than ahead of the bleeding edge with. Time tends to erase perspective. Here's an example:
// get a connection to some server
id server = [NXConnection connectToName: "exampleserver"];
// Then use objects on that server.
List *aList;
Widget *aWidget;
aList = [server widgetList];
aWidget = [aList objectAt: 0];
Also, as you can probably imagine it was horribly insecure, with no encryption. It was the late 80's, early 90's.
I had three or four people who kept bugging me that I had my rear over the Xerox PARC and see what they were doing, and so I finally went over there. They were very kind and they showed what they were working on, and they showed me three things.
But I was so blinded by the first one that I didn’t even really see the other two.
One of the things they showed me was object-oriented programming. They showed me that, but I didn’t even see that. The other one they showed me was really a networked computer system, there were a hundred Alto computers, all networked, using e-mail, etc., etc.. I didn’t even see that. I was so blinded by the first thing they’d shown me, which was the graphical user interface. I thought it was the best thing I had ever seen in my life.
The simplest way to explain NeXT is Steve getting back to those other two things after turning the first thing into a product with the Macintosh.
"The origins of Objective-C at PPI/Stepstone and its evolution at NeXT"
its a great business case study (especially if you read it knowing what comes later) imo
https://web.archive.org/web/20211220184240/https://blog.haym...
(About halfway down this apropos article) https://www.howtogeek.com/698532/before-mac-os-x-what-was-ne...
I did as a freshman at Ohio State and found out in his reply that he was not a fan of read receipts! They are an invasion of his privacy!!! lol
Said what could save Apple would be a small, handheld, battery-powered device that WAS your computer, and could plug into anything and be your computer.
Today I'm happy to use a Samsung Galaxy S21 that plugs into a monitor and is my computer.
What kind of workload do you use it for?
I am on a desktop at work as I type. I have a work laptop that hasn't left the bag I carry in months. I have no computer at home, and no tablet at home. I have a phone, an HDMI-USB/C adapter, and bluetooth keyboard/mouse. The phone is my computer.
I had always heard of Frameworks and how they differ from Libraries, but those first few weeks (months?) were the most exciting of my development career. Learning how much of the heavy lifting WO did was simply incredible and being able to whip up a very fully-featured Web Application in an our or two was impressive.
writing the Java line 'NSArray customers = new NSArray()' always put a smile on my face. (NS stands for NextStep).
For the 21st anniversary a few of us got together outside the old NeXT office in Boston. We tried to hire a Dr. Gil Amelio impersonator but had no luck finding someone, so one of the group just did an impression of old Gil.
And, all that technology that I started learning when I bought my $11,000 NeXT cube in Indiana in 1988 now runs on my phone. And my watch! On my wrist. Objective-C runs on my wrist today. Crazy.
Fantastic article. Can't believe it's been a quarter century already!
[0] -- https://youtu.be/pkvQ-BJD2rU