Apple Computer, Inc

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Apple Computer, Inc. was founded by Steven Jobs and Stephen Wozniak in Jobs' garage in Los Altos, California, in 1975. Their goal was to change the world by developing an easy-to-use computer that everyone could own.

In November of 1975, Wozniak finished assembling the Apple I—a modest device that consisted of a motherboard, a keyboard, and a display. The advantages to the Apple I were simplicity, price, neatness, and reliability. The disadvantage was that it used the 6502 MOS Technologies microprocessor chip, a cheaper alternative to the popular Intel 8080 chip. This chip fundamentally set the Apple I apart from Intel-based machines. However, Jobs first proved his marketing skills with this computer when he found backers willing to supply the cash and personnel to incorporate the company.

For the Apple II, which was released in 1977, Wozniak switched to a Motorola microprocessor, then gave the personal computer a color display. In doing so, Wozniak redesigned the way the computer utilized the microprocessor. He engineered the software to allow the microprocessor to do multiple tasks at the same time, including driving the color display. This simplified the machine so much that personal computers became cooler in temperature, lighter, more durable, cheaper, and easier to assemble. As a result, computer hardware could be mass-marketed, resulting in an affordable product for the consumer and better profit for the manufacturer.

The Apple II computer was so successful that several versions of it remained on the market for ten years. During a time when the word "computer" evoked images of huge commercial, or mainframe, machines, Appleoutsold all others in the budding personal computer market, dominating the competition from Atari, Zenith, Commodore, and Tandy.

In 1980 the Apple III was released. It proved unsuccessful. Shortly thereafter, IBM, the mainframe computer manufacturer and Apple's main competitor, introduced its PC in 1981. The IBM-PC used Microsoft's operating system and the Intel chip. This opened the door to a more competitive market for personal computers during the 1980s.

In 1983, Apple's sophisticated Lisa failed to meet expectations. However the Macintosh, introduced in 1984 with a Motorola 68000 microprocessor chip, added a versatility that put the machine many years ahead of its competition. This also marked the division of the personal computer market into two primary segments: the Macintosh platform of hardware and software vs. the IBM or IBM-compatible PC platform.

In 1985 both Wozniak and Jobs left the company they had cofounded ten years earlier. Throughout the 1980s and 1990s, Apple declined to make the Macintosh operating system compatible with Intel-based PCs. With few exceptions, the company declined to license either its hardware or software, as well, making it difficult or impossible for other companies to create software and hardware peripherals that would be compatible with Macintosh systems.

Instead of continuing to dominate the industry it helped establish, Apple became the classic illustration of non-conformity and incompatibility in a marketplace that rewards compatibility. For example, a 60-watt light bulb of any brand is compatible with a lamp from any manufacturer. By the late 1980s, people had come to expect such compatibility between software and computers as well. Some industry experts believe that if Apple had agreed to license its products, the industry would have matched its peripheral hardware and software to Apple products. Instead, the establishment of computer industry standards fell to IBM, Intel, and Microsoft.

From its inception, Apple grew steadily into a multi-billion dollar company. However the dominant market share it once held shrank to less than four percent by 1997. Furthermore, it was not until the Internet was established that Apple made its products compatible with Intel-based computers. Before long, Apple Computer's decline appeared to be irreversible. Compatibility problems with PCs, low market share, persistent dismal sales, the frequent turnover of its top executives, the loss of talented personnel, and successive layoffs sent the value of the company stock to a record low of less than $13 per share in 1997, well short of its break-even point.

However, in 1997, then-CEO Gil Amelio recruited Jobs back to Apple. Jobs brokered an agreement between Apple and Microsoft. The contract provided Apple with a much-needed cash infusion, Microsoft software specific to the Macintosh, and new credibility. With the subsequent introduction of the iMac, PowerBook G3 laptop computer, and the PowerMac G4, Apple stock was revived. By December of 1999, the iMac was the best-selling personal computer brand in the retail market, and Apple's market share had increased to 11.3 percent.

Mary McIver Puthawala

Intel Corporation; Microcomputers; Microsoft Corporation.

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