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Miscellaneous Ramblings

Charles Moore - 2008.08.11 -Tip Jar

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There has been much discussion about Steve Jobs' health afterApple's iconic cofounder and CEO appeared on stage at the WorldwideDevelopers Conference (WWDC) in early June looking gaunt and seriouslyunderweight - even 'sickly', according to some - and speculation thathe might be ailing.

And about what effect his departure would have on from Apple futureand stock valuation.

This is not exactly a new line of conjecture. In 2004, Jobsannounced to Apple employees that he had been diagnosed with amalignant tumor in his pancreas, but that it was a rare, far lessaggressive form of pancreatic cancer known as islet cell neuroendocrinetumor, which was subsequently removed successfully in July 2004. Hereturned to work later that year.

However, at the 2006 WWDC keynote, Jobs' 'thin, almost gaunt'appearance and 'listless' delivery (to cite commentary at the time),together with his delegation of portions of the keynote to otherspokespersons, sparked a spike of media and blogosphere speculationabout his health, which blew over fairly quickly, but it has beenreignited by his appearance at that event this year.

Apple tersely explained Jobs had been battling a 'common bug' andwas taking antibiotics, but that didn't quell the rumors and conjectureabout Apple's possible future without Steve Jobs.

During the company's July 21, 2008: earnings announcement conferencecall, Apple again insisted that Jobs' health is a 'private matter', astance I'm inclined to agree with, but that didn't satisfy manycommentators. On July 26, New York Times columnist Joseph Nocerareported a somewhat testy 'off the record' phone conversation in whichJobs informed him that while his recent health issues 'amounted to agood deal more than 'a common bug,' they weren't life-threatening andhe doesn't have a recurrence of cancer.'

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Walt Disney and the Disney Company

Last year, the financial journal Barron's suggested thatApple's market cap would instantly drop by a dizzying $20 billion invalue should he suddenly be forced to resign his company chairmanship,which is the main concern driving widespread anxiety about Jobs'health. That's arguably a legitimate concern, as others have suggestedthat a Jobs departure from Apple would be analogous to what happened tothe Disney Company after Walt Disney died - only several magnitudesgreater, and more than a decade after Jobs returned to Apple after along exile, having been fired from thecompany he founded by John Sculley in 1985.

There is still no obvious heir-apparent. Perhaps Jobs is quietlygrooming someone to replace him as Apple CEO, but it's difficult tofathom who that might be, although The Economist recentlypublished a speculativepiece on the Jobs succession at Apple, noting:

Jobs is arguably unique in the extent to which hisidentity and fate are intertwined with those of his company. ImaginingApple without Steve Jobs, or Jobs without Apple, is difficult - as hisexile from the company between 1985 and 1997 made plain....

So who might succeed him? Tim Bajarin, an analyst whohas followed Apple for decades, thinks that Jobs has bred such a strongculture within Apple that there is 'nobody on the outside who couldeven come close' to taking the reins successfully.

He also believes that Jobs has recently groomed 'thestrongest team he's ever had,' making it even more likely that the nextboss will come from this group....

Hopefully gloomy forebodings will prove groundless, but should theynot, heaven forbid, (and, of course, even if he lives to a ripe, old,age, the day will come for what I hope will be a long and happyretirement), what are the prospects that Apple will continue to crankout insanely great stuff for decades to come after he leaves?

The Walt Disney analogy is an apt one. Disney was never the sameafter Walt died. Like Jobs, he was the visionary and anchor of the firmhe created, and the money-grubbing bean-counters who followed in hiswake simply didn't possess the imagination and creativity to carry onhis legacy faithfully and authentically. The 'vision thing' can't bewhomped up at will. You've either got it or you don't.

William Lyons and Jaguar Cars Ltd.

Anotheranalogy is England's Jaguar. Apple was founded by two Steves, andJaguar was founded by two Williams (William Lyons and William Walmsley)as the Swallow Sidecar Company back in the 1922. As with Steve Wozniakat Apple, Walmsley left early on, and Lyons become managing director in1933. While there were many other contributors to the rise of Jaguar,such as engine designer Harry Weslake and chief engineer WilliamHeynes, Lyons was the visionary and had a personal hand in conceiving,designing, and styling all of the classic Jaguar models right up to thelegendary XJ6.

However, when Lyons stepped down as Jaguar managing director in 1966(he remained chairman and CEO until 1972), the rot quickly began to setin. The company was swallowed up in a series of mergers that createdthe BritishLeyland Motor Corporation conglomerate, and basically continued toexploit the gradually diminishing momentum of the Lyons vision. Newmodels were introduced, but they lacked the grace and elegance of theLyons designs.

Jag hived off the foundering Leyland group in 1984 and continuedstruggling along until it was bought by Ford in 1989, ensuring itssurvival for a time at least. It never made a profit for Ford in 18years, and it was sold again last spring (along with Land Rover) toIndia's Tata Motors Ltd. in a$2.3-billion deal - considerably less than half what Ford had paid forthe two companies in 1989 and 2000 respectively. This is a merespit-in-the-ocean compared to the $50 billion some observers suggestthe Jaguar/Land Rover adventure cost Ford.

Tata Group chairman Ratan Tata, who eight years ago acquired anotherBritish corporate icon - Tetley Tea, which isreportedly prospering under his ownership - has commented, 'Our plan isto retain the image, the touch, and the feel of Jaguar and Land Rover.We will not tinker with the brands in any way. They are special globalbrands, and whoever acquires them has a responsibility to nurture themand enable them to prosper.' Hopefully, Mr. Tata will succeed whereFord failed.

Jaguarhas as yet never transcended the Lyons legacy, with its most successfuland signature styling themes derivative of the XJ6 and the 1950svintage S-Type, andthe grace of Lyons' E-Type sports car hasnever been matched. Sadly, the latest Jaguar XF apes the Lexus GS inprofile - still handsome, but neither original nor stunning the wayvirtually all the Lyons Jags were.

Can Ratan Tata restore the vision? We'll see.

Steve Jobs and Apple

Jobs/Disney and Apple/Jaguar are rough analogies at best, sinceApple's history contains a long precedent interregnum of 12 yearswithout Jobs, which was longer than his present tenure, and the companystill managed to produce some pretty cool products during thatperiod.

Still, the second Jobs era has certainly been Apple's creativeheyday, and even in exile, Jobs (at least in hindsight) was laying thegroundwork for Apple's renaissance in the form of NeXT Computer, whoseNeXTstep operating system became both the basis for Mac OS X andthe vehicle that brought Jobs back to Apple.

I've disagreed with a lot of Jobs' decisions at the time they'vebeen announced, but more often than not he's been proven right - forinstance, in pulling the plug on MacOS clone licensing back in 1997, although I still think he wasastute in canceling the G4Cube in 2001. On the other hand, there probably never would havebeen a Cube without Jobs' vision, so there you go.

For now, Mac OS X and the continued elegance and superb userexperience of Apple products will keep me and a lot of others in thefold - and Apple's balance sheets healthy.

And who knows? Steve Jobs is a bit younger than I am. Perhaps he'lloutlast me.

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Charles Moore has been a freelance journalist since 1987 and began writing for Mac websites in May 1998. His The RoadWarrior column was a regular feature on MacOpinion, he isnews editor at Applelinks.com and a columnist at MacPrices.net. If you find his articles helpful, please consider making a donation to his tip jar.

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