A Little Reminder of How Far Apple Has Come

Kevin Maney remembers the grim times: So today Apple plans some kind of announcement, and just the mere whiff of anything new from Apple whips the tech community into a froth. But actually, it wasn't that long ago that Apple sucked.

I had a friend at USA Today pull out an old column that I wrote, dated Oct. 17, 1996 -- pretty much at Apple's nadir. I wrote it off an interview with Gil Amelio, who had taken charge of Apple as it was spinning into irrelevance. He was a horrible fit, but not long after this interview, he did the one thing that eventually saved the company: He brought back Steve Jobs. For more context, check out this detailed story on Amelio. But to really feel that immediate 1996 moment, plunge into my old column...

Gil Amelio, CEO of Apple Computer, polishes off a tuna sandwich on whole wheat and a little bag of Lay's potato chips. Amelio was hired Feb. 2 to save the world's best-known PC maker, and he's been spending most of the day at a technology conference answering questions about how he is changing Apple.

So I ask Amelio if Apple is changing him. After all, Apple has one of the most seductive cultures in technology.
Amelio, 52, shifts in his seat. He has certainly stuck to his own dress code, wearing a dark suit, red-striped shirt and tasteful patterned tie -- unlike John Sculley, who left PepsiCo to run Apple and immediately started dressing in jeans and twill shirts. Actually, Amelio wouldn't look right in jeans and twill shirts. He looks more like the guy you'd see on a cruise ship wearing bermuda shorts, dark socks and wingtips.

To answer the question, Amelio tells a story. He had been keynote speaker at Macworld, an Apple show in August in Boston.

"At the end of the event, I went out the stage door in the back," he says. "As I walked out, a youngish woman recognized me and asked me for my autograph. And then she wanted to have her picture taken with me."
At this point in the tale, Amelio looks sheepish. "And the next thing I knew, this girl's giving me a big kiss," he says. "I was totally not expecting this. The hardest part of this job is that you have to be more than a manager. You have to be a rock star. And I'm not that good a rock star."

That pretty much describes the collision of Amelio and Apple so far. Amelio is the sober CEO who turned around National Semiconductor before being hired to inject discipline into Apple. And Apple is the company that's never really been much of a company. It's a movement. It's like the Christian Coalition, with factories.

Amelio has done his best to remain the adult -- to do the job he was brought in to do. Most observers praise Amelio for bringing order to the house, cutting costs and at least stabilizing Apple for the short term. Apple earnings, out Wednesday, showed a profit for the first time in a year.

"I came into this as a seasoned CEO knowing pretty well who I am and what I stand for," he says. "There are some positives about being Apple's CEO. I can see just about anyone I want. If I had to see the vice president, I could. If I had to see Bill Gates, which I do, I do. But I remind myself every day who I really am."

The knock on Amelio is that while his all-business persona is good for the coming quarter's earnings, it falls short in the vision department.

Listening to him over lunch, it's not that Amelio doesn't have a long-term outlook for Apple. He does. It just doesn't sound sexy. It's probably pragmatic. It may even be successful. But it doesn't have the ring of Steve Jobs thumbing his nose at IBM and saying Apple is building "a computer for the rest of us." And that disappoints a lot of people.

For instance, Amelio says that in five years, he sees Apple operating on a very different business model. It will be a la carte pricing.

Now, Amelio says, when you buy a Macintosh computer, you get a ton of other capabilities built in, like video, networking and word processing. In the future, he says, "stuff that used to come for free on the Mac, we'll have to start charging for it. People will pay for what they use. So we lower the cost of the hardware and if they don't need all this fancy software, they won't have to pay for it."

By making software a separate product, Apple could evolve into as much a software company as a hardware company and maybe get away from the Mac vs. Windows dogma. The day could come when people buy Mac boxes that run Microsoft's Windows operating system. Just last week, Apple said it would offer Windows NT on Mac servers.

Separating hardware and software might allow Apple to get into inexpensive computers that do one thing really well, like send and receive e-mail or run a spreadsheet.

"An analogy is, suppose you want to toast your bread in the morning," Amelio says. "You could go to a general purpose device, which is the oven. An oven could make toast. But most people would just go to the toaster. It's optimized to do a particular job well. The PC until now has been a very general purpose device. In the future, you'll see more specialization." And Apple's future might lie in making such devices.

Not exactly inspirational, but Amelio certainly wants to make sure Apple's around for the long term -- long enough, as he says, to sell his grandchildren Macs. And no doubt long enough to get a lot more kisses outside a lot more stage doors.