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Mr. Jobs goes to Wall Street ... and gets thrown out

By Johnny, johnny@macedition.com, 23 October 2000

Some of us Mac users weren’t surprised by Wednesday’s news, or even the earnings warning a couple of weeks ago. Call us pessimists, but somewhere in those product announcements in New York, we saw disturbing flashbacks of a history forgotten. And these only intensified upon hearing the Q4’00 financial results conference call.

Another Cube, another delusion of grandeur

In introducing the Power Macintosh G4 Cube, Steve Jobs showed that he doesn’t learn very well from his mistakes. There are too many parallels to the NeXT Cube to list, but the one that bugs me the most is the nonstandard monitor connection.

Note that a $90 million shortfall was attributed to the Cube – and “related displays”. Sure, the lack of monitor sales is only part of the problem, but why did Apple have to make it any more difficult to sell them? By switching to the ADC connector, they not only subtracted Wintel users (who were attracted to the best-in-class 15" Studio Display) from their potential market, but countless users of pre-MWNY Macs as well. And for what – Jobs’ aesthetic mandate of less cable clutter? Did you, by chance, count the additional cables introduced by the Cube’s all-digital sound system? (There’s three.) There’s a better compromise: the original Cinema Display only had one cable leaving the monitor, but broke out into standard connectors at the computer end.

This idiotic move, in combination with the elimination of the 21" Studio Display, ensures that Apple will get less revenue from creative professionals – a core constituency. Jobs seems to believe that Apple displays exist solely to accentuate your brand-new Cube or G4.

And straight out of Steve’s mouth: “Some customers have been upset with less than perfection.” Gee, Mr. Billionaire, for the inflated price, my hard-earned Cube better be perfect. After all, you taught us to accept nothing less – us Apple customers have come to appreciate the little touches that make our computing experience richer. The Cube’s biggest differentiator from the rest of the lineup (and indeed, the industry) is its looks. And now, we’re supposed to ignore the aesthetic flaws?

If nothing else, Jobs’ condescending words for Cube buyers reveal that he sits squarely in his own Reality Distortion Field. Jobs claims that the Cube is the first product that hasn’t met the sales expectations of the current management. It hasn’t been the first time for Steve himself, however. Back in 1984, he also thought the original Mac was beyond reproach, and overestimated demand by 100% (according to Michael Malone’s book, Infinite Loop). And then, as now, the price proved insurmountable for enough drooling consumers to cripple sales.

Made by children, not for them

Education has long been one of Apple’s stronger markets. But not being content with alienating the enterprise and apparently now the creative professionals, Apple is now gradually shooing away educators, as evidenced by the $60 million shortfall blamed on poor education sales. It’s been a tough battle of late already – Wintel machines have made inroads, while Apple’s been pumping profit margins by reducing educational discounts to the point that they’re worthless. And by terminating relationships with their third-party educational salespeople, Apple has terminated some of their strongest relationships with educational institutions.

And constant mumblings in the industry that Apple is not run by adults are given credence by Jobs’ remark that “in hindsight, the July quarter was clearly a poor time” to uproot the sales structure, being the most crucial educational sales period of the year. Excuse me, but when you run a Fortune 500 company, you think about this sort of thing before you do it.

Nothing new under the sun

As for the lack of high-end G4 sales, there ain’t much to say – except that not too many are swallowing the Photoshop “bake-off” pseudo-benchmarks. Motorola’s trying to keep the naysayers at bay with preannouncements of 1GHz G4s, but considering that the 700MHz G4s they promised last year haven’t yet materialized, I’m not holding my breath.

And in the conference call, Jobs promised new products that’ll make us all soil ourselves, coming Real Soon Now; but was characteristically tight-lipped when asked for any kind of actual specifics. Now, don’t tell me how important it is for Apple to keep “unannounced products” secret – when analysts ask for clues as to where your company’s going, you either give them or expect the stock to suffer. (And you aren’t fooling anyone; I know you read the rumor sites, too.) No one’s asking to see the design of the next iMac, but some concrete product specs would be nice, to show that Apple is not just hoping that their Moore’s Law moratorium will be lifted.


Of course Apple isn’t folding anytime soon, but they aren’t exactly on stable ground, either. (Then again, if they ever were, we wouldn’t have sites like As the Apple Turns.) And sure, there are bright spots to mention, but I’ll let other Mac sites gush about those while they gloss over very real problems. Losing a big chunk of money keeps this unhappy Apple stockholder firmly planted in the real world.

— Johnny is one irate AAPL part-owner and creative professional who ain’t gonna swallow Steve’s Kool-Aid anymore, much less that of fanboys with no vested interest.

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