Sunday, October 9, 2011

Take a bow, Steve!

Steven P. Jobs, the founder of Apple Computers and one of the most popular entrepreneurs in history died on October 5, 2011.

By now this is old news. The obituaries have been posted, eulogies showered. After all, he was a darling to many. Consumers loved the products he delivered. Connoisseurs appreciated the beauty, simplicity, utility and technical details in them. Stock brokers loved the money they made from trading Apple's stocks. Retailers, content producers, application developers, telecom companies and component manufactures benefited from their relationships with Apple. Politicians - especially American politicians - loved him for keeping the American economy and pride going by delivering innovative products that the markets world over craved for, even in the face of the recession. Even rival companies benefited from the economic activity his products helped create.

He was labelled variously as visionary, inventor, innovator, communicator, salesperson and a beautiful mind. His business methodology became subject of study at management schools. His stage shows turned the technology world into frenzy. His product announcements were eagerly looked forward to, widely reported and greeted with fanatical cheers. His demeanour, simplicity, the control he exercised over the creation and usage of his products, his abrasive behaviour towards his employees, the iron curtain around his private life, his close relationship with fellow tech entrepreneurs, the aggressive defence of his firm's intellectual property - all defined the character of the man that stood so high in the public eye. He was essentially the public face of Apple, the company, so much so that often his name and the company's name were used interchangeably.

If we look closely, Steve Jobs did not invent anything new. Portable music (MP3) players existed long before iPod came along. Smartphones existed since the days of Nokia communicator (1996). Microsoft tablet PCs were commercially available eight years before iPad was released. When we mention File sharing the first name that comes to mind is Napster, not quite iTunes. Even his glittering product launch spectacles were not original - Oracle's chief Larry Ellison was the first to do such stage shows (in the tech world it is called the "Larry Ellison show" even when he is not involved). Despite all these, Apple (and Steve) became the greatest success at delivering these products and services individually and as part of a digital ecosystem.

There are two factors at the core of this success - product design and control.

All Apple products, without exception are beautifully designed. Small form-factor, stunning appearance, intuitive user interface and beautiful packaging made its products highly desirable. A few years ago, a colleague of mine described the vivid expressions of her son when he was gifted an iPod for his birthday. It came in exquisite packaging as if it were jewellery. He opened it with wide eyes and on seeing the gleaming red gadget inside, crooned "Oh, my baby, my baby". Of course, the excitement came at a price to match. That is another peculiarity with Apple's products - they are never cheap. It is probably that high price point, combined with the appearance and packaging that made Apple products a much-coveted gift during the holiday seasons over the years. After all, who wants a cheap Walmart toy for a gift! Beauty and uniqueness were always Apple's USP.

Apple very soon realised that it is just as important to have content for their devices. Enter iTunes. In the past decade nothing has revolutionised the recording industry quite like the iTunes (if we briefly ignore the illegal pranks of Napster, Kazaa and all). Consumers could purchase single tracks legally from the iTunes store instead of having to purchase entire albums - most of which had a track or two that people wanted to hear a second time. The amazing price point of a dollar per track made it an incredible value proposition. Quite a few of the artists saw great opportunity in this transition - now they could market their own music directly to the customer without having to go through the recording industry's middlemen and pompous publicists. The result? Almost all of the music retailers in North America went out of business. Apples business model inspired companies like Netflix and Hulu to start legal video streaming services at a price anyone could afford. Whatever life was left of the disk vendors and video rental companies, was sucked by the recession of 2008.

With enormous market success came enormous power and Steve was nonchalant in using that power. In the following years and with the release of each product we saw the overbearing patriarch in him. Initially he was not too keen on producing a phone or a PDA or a tablet. It was understandable. In North America, the phone carriers owned the cell phone customers. Almost all cellphones were bought through the carriers - the customers got discounted phones in return for long-term contracts. The phone manufacturers were at the mercy of the carriers. With the success of his products, Jobs could speak on level terms with the carriers - in fact he would get the carriers to sell his phone on his own terms. The iPhone was launched exclusively through just one carrier in each country. He refused to allow his product to be treated as an accessory to carry the carriers signals. For him (and eventually his customers) the iPhone was the star - the carrier was just one of the service providers and accessory suppliers. To this date one will never find the carrier's logo on an iPhone case. Eventually he let up on the exclusivity of carriers but by then it was clear to everyone, who owned the iPhone customer.

The launch of the iPhone was a landmark for Apple - it was from that point that the company started exercising enormous control over the design, manufacture, delivery and usage of their products and over the relationship with its partners. The company vehemently chased down those responsible for product leaks at the design, manufacturing and delivery stage. Customers were not allowed to change anything on their devices - not even their phones' batteries. All cables, docks and connectors had to come from Apple or its authorised suppliers. Parts manufacturers, assemblers and their employees were not allowed to disclose information about their supplies to Apple - they were all bound by very stringent non-disclosure agreements. In some cases, Apple was seen to do pre-emptive sourcing of components (placing enormous orders with exclusive parts manufacturers so that competitors would not be able to get them). When "Jailbreaking" became commonplace to work around restrictions imposed on devices, Apple would attempt to "patch" them back to original state or void the warranty. Even Apple's operating system "Mac OS X", which is sold as independent software, is not allowed to be installed on hardware of your choice - it had to be installed on Apple's hardware only. When a US-based company named "Psystar Corporation" attempted to market a custom-built computer which had legally-purchased Mac OS X preinstalled, Apple sued them for violating the Digital Millennium Copyright Act and won. Most recently, Apple entered into a series of legal disputes with Samsung - which ironically is one of Apple's major component providers- for violating their patents. They even went to the extent of getting courts to block the sale of some Samsung products (smartphones and tablets) in various parts of the world.

To label Steve Jobs as an arrogant paranoid control freak would be far from truth. In fact, the best description of his personality and its evolution, came from the man himself. In his commencement address at California's Stanford university in 2005, he uncharacteristically talked at length about himself - his evolution in life and even about his death. I strongly suggest that you read and watch his speech yourself, for, it is impossible and unbecoming to summarize or annotate it. That one speech reveals his thought process, his excellent communication skills, his attitude to life and work and most importantly his principles. His overarching dictatorship of the Apple empire was perhaps prompted by his expulsion from the company he founded. His frantic efforts to bring out first-in-class products was perhaps fired by the knowledge of his terminal illness. He was a practising Buddhist - which, in my opinion, is the only philosophy that a completely logical person can get along with. His minimalist appearance was in sharp contrast to the glittering extravagance of his products. He shared a very cordial relationship with Eric Schmidt of Google and Mark Zuckerberg of Facebook (in fact Mark described him as his mentor). He was a devoted family man. He was also an intensely private person - Wall Street often alleged that he was disrespectful to thousands of investors who had a stake in Apple, by not adequately and quickly reporting his medical condition (which had a bearing on Apple's stock prices).

The most important thing to remember about him is that he changed the digital world for ever. Even those who have never used a single product from Apple or never been involved anywhere in their supply chain, benefited from Apple's creations. Recently, I received an upgraded Blackberry from my employer. It came with a full touch interface and no hardware keyboard - just like the iPhone. The display is crisp, the browser is fast and it came with a lot of applications. This Blackberry would have been unthinkable even three years ago. The enormous success of Apple at such high price points ensured continuous orders for parts suppliers, which in turn led to further innovations and lower prices for the electronic components used by all device manufacturers. There wouldn't have been a beautiful, powerful and feature rich Android operating system found in some of the popular smartphones of today, but for the pioneering work by Apple. Even Blackberry evolved from a Government servant's dull communication device to a desirable consumer product. My Ubuntu Linux desktop's "Unity" interface would be able to trace its pixel ancestry to Mac OS X. Windows 7 and the upcoming Windows 8 put more focus on the user experience primarily because of the challenge thrown by the Apple's Operating System. Social networking sites like Twitter and Facebook are credited with revolutionizing our social life, but they are just web sites - they would not have had the ability to galvanize popular movements in Egypt, Syria and Libya but for the mobility of the internet pioneered by Apple.

Apart from the lessons that we all learned from his Stanford speech, Steve Jobs' life teaches a few more. The ingredients for your success can be found all around you. Your success lies in the value that you create out of them. The popular iPhone's components are sourced from manufacturers all over the world. The total cost of those components (minus the operating system, of course) is just a third of the retail price of the device. Even including the retail cost of the operating system, it can safely be assumed that Apple makes 40 to 50 percent profit on each device it sells. Another lesson learnt is that even with all the features and conveniences that comes with technology, human elements like beauty, exclusivity, simplicity, ease of use and relationship with everyday lives matter. Last, but not least - Scientists may bring about the important innovations that make our lives better. But it will always be an artist's effort that will be the most loved by the world. Love matters, in the market.

You have lived a complete life Sir. Thank you for changing our lives for the better. Take a bow, Steve!


  1. It's one day after his death that I read that famous speech by Steve. it was so enlightening and revealing that i forwarded it to some of my friends and i decided to save it in my mailbox.

    in fact i haven't read any long articles about Steve after his death. his own speech was enough. i didn't want to corrupt my impressions of it with other's writings.

    then, kocheechi's is the only article i am reading about steve after his death. As expected it wasn't in vain. This post really analyzed his life, death and his mission. It's the first time i come to know that Steve was a Buddhist. it's mainly because i am not used to read about celebrities, except in the world of literature. But when the news broke of Steve's demise, I knew this celebrity was a different class and i would have to read it and i did. at least i read his speech very carefully and was really impressed.

    It is beyond doubt that he revolutionized the world of computing and communicating. But what i really amazed about was his extra-ordinary life and faith in the future even when he was met with the ultimate "failure" (his terminal illness). That's really amazing and inspiring.

    about this post, I am not in a position to make a view in depth as i am not a tech-wiz. the one thing i see is kocheechi has more than enough knowledge about the topic here. but then it's not surprising, it has always been so, whatever be the topic. you always deployed your words in convincing terms.

  2. Media all over the world have already given elaborated coverage to the death of Steve Jobs. He deserves it indeed. A bourgeois school dropout touches the apex of achievements must certaily consider as a miracle. He was, born to an unmarried mother and later, adopted by a chritian couple. He, had started from a common workshop and had once been expelled from Apple too. All these factors indicates that nothing can discorcert one's motion to success if he is adamant on the action.

    Your article is relevant and timely.
    Thank you for presenting this gift to us.

  3. another apple story presented in
    different way..!!!you too are smart
    in delivering this product to the readers kocheechi..congrats...

  4. Salam, Thank you for your kind words and for spreading the word about this post among your friends. As you indicated, I too was impressed by that speech - in fact he had penned his own best obituary. I did not want to quote his speech exactly for the same reasons that you stated.

    Shukoor, success is about being at the right place at the right time among the right people. But, as you mentioned, elevating that success to the highest level is a matter of character. I am not in favour of some of his business practices, but I understand his motives. Thank you for dropping by and commenting.

    ente lokam, Thank you very much for your encouragement and support. I am not very smart, just loud and opinionated ;)