Alan Deutschman's The Second Coming of Steve Jobs was published in October 2000 -- several years before Apple (NAS: AAPL) introduced the iPod, iPhone, and iPad. Since that time, the stock has been on a tear, at one point surpassing ExxonMobil as the most valuable company in the world by market cap. On the heels of the 2007 Macworld Expo, we talked to Alan Deutschman about the iPhone, Steve Jobs, and Apple's future. As we mourn the loss of Jobs, see what Deutschman had to say in '07 about the hallmark of his career and the intensity of his vision.
Mac Greer: What is your take on Apple's iPhone?
Alan Deutschman: Well, the hallmark of Steve Jobs' career is his willingness to take big risks. Sometimes, they are incredibly successful. Examples would be the iPod, the iMac, and in his first tour of duty at Apple, the Apple II and the Macintosh, which was a very slow starter but of course became a huge hit.
Sometimes, his risks results in big flops. It is hard to remember, but there was the Apple III and the Lisa and ...
Greer: And what was the Lisa? Refresh my memory. I remember the Newton, and the Newton was kind of a mess, right? You wrote something on it, and it turned it into gibberish.
Deutschman: That's right. Well, the Newton was actually the baby of John Sculley, the CEO who pushed Jobs out at Apple. It was John Sculley's effort to reinvent himself as the next Steve Jobs, and it was kind of a predecessor to what became successful as the Palm Pilot. But the Lisa was sort of a Macintosh-like computer for business. It failed. The Apple III, even during Apple's incredible comeback this time around for Steve Jobs -- remember the Mac Cube, which was a little cube that reviewers loved and maybe four people purchased? (Laughter.)
So with the iPhone, Jobs is taking a big risk. The product is expensive. It is coming into a very competitive market. It is a whole new thing for Apple, and it may be an enormous hit, and it may flop, but Jobs brings it out at Macworld in front of thousands of people. He gets front-page headlines -- and this is for a product that is still a prototype essentially, and it is unclear whether Apple legally can even use the name that they have publicized. (Laughs.)
Greer: And let's talk about that. Cisco is suing Apple over the use of the iPhone name, which Cisco trademarked back in 2000. Cisco's iPhone began shipping last spring and officially launched three weeks ago. Now, according to reports, Apple and Cisco [have] been negotiating over the name for several years, but talks broke down just hours before Steve Jobs introduced Apple's iPhone at Macworld. Does it surprise you that Apple and Steve Jobs would introduce Apple's iPhone before resolving that naming issue?
Deutschman: Well, Steve Jobs has tremendous chutzpah, and that is not a word that everyone in America might know or understand these days, but it is a word that Steve Jobs has always known and loved throughout his career, according to colleagues who have worked closely with him. The man has, to use another phrase, the man has cojones. He goes forward with his vision, and he is not always the most cautious person of things that might get in his way. At this point, even if they have to change the name, if it has to be the Apple Phone or the iPod Deluxe or something, they've already had the front page of The New York Times and the front page of every business section and TV coverage, but Steve Jobs' brinkmanship doesn't surprise me. It is something that he has practiced repeatedly over the course of his career.
Greer: Let me get your thoughts on an interesting comment I read by Dave Hamilton, the co-publisher of an Apple news website called The Mac Observer. He was talking about Jobs and the iPhone, and he said that about 80% of the iPhone's features that Jobs talked about are available on a Palm Treo, but he went on to say, and this is a quote, "Jobs is so good at standing on a stage and making you think he invented it." Do you agree with that?
Deutschman: Oh, absolutely, and Jobs has done this before. There were handheld portable MP3 audio players before the iPod. Jobs did several things, and people in the technology field with a technocratic engineering mindset often miss the importance of what Jobs does. One, he improves the user interface, and even small improvements in user interface can make a huge difference for consumers.
Two, he makes it an event. He has Macworld, which is a pilgrimage. It is the Mecca for the creative class. He makes it into an event that is anticipated for months ahead. The media needs an event as something that qualifies as news that they can cover, and they like a personality, and they like a narrative, a story, and Steve creates all that.
And then the third thing is consumer products are, they are about trends, they are about fashion, they are about brand names. A lot of people make running shoes or make blue jeans or handbags, but still it makes a difference whether you are buying Nike or Levis or Prada. Those in the fashion and consumer world, people don't say, "But we made handbags first." (Laughs.)
Greer: Yeah, or "80% of the shoe was already made by us."
Deutschman: Right, exactly. I mean, in the technology field, often having a lead in technology or being the first to come out with a product or feature, those leads do not last very long. The people who are going to ultimately capture the market are the ones who understand all the other aspects of business. A generation ago, just developing the technology was enough, and now you have to master marketing and promotion and all the other things that people in every other industry have to deal with.
Greer: And how involved is Steve Jobs with the day-to-day product design at Apple today?
Deutschman: Steve Jobs has always been passionately involved in the product design at Apple. For iTunes and the iPod, he obsessed over the design of the iTunes Web page and exactly where certain words and graphics were placed on the Web page. How many CEOs get involved at that level in a product? From his earliest days at Apple to today, he has been passionately involved in the details of the products.
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