Apple Inc.

Past and present

About Apple Inc.

Founded on 1 April 1976 by three computer engineers — Steven Wozniak, Steven Jobs and Ronald Wayne — the Californian-based company known today as Apple Inc (formerly called Apple Computer Inc.) became an American household name in 1984 when it sold the world's easiest point-and-click computer and operating system (OS) for the consumer market allowing people to get their work done more easily and with less angst and without having to become a computer programmer.

Despite the brilliance of the new product surpassing practically every other personal computer manufactured before it, to benefit from such an innovative and easy-to-use OS and high quality control methods and quality computer components, consumers had to pay dearly for the privilege (around AUD$8000 per machine).

The reason for the high cost of Apple computers in the early days can be explained in terms of the quality of the components used and where the manufacturing took place. At the time, it was not unusual for Apple computers to be constructed under the one roof and within the United States. Many components were assembled by American Apple workers who took pride in their work as they made the best computers on the planet. The result was an excellent, high quality and long-lasting product where consumers could enjoy and put to work the product for as long as it was required (in fact, you can still pick up the original well-constructed Apple Mac SE computer built in 1986 or the original Apple 128K of 1984 in good working order!). Even if certain components needed to make an Apple computer could not be produced by Apple direct, at least Apple would source these components from quality third-party hardware manufacturers (usually within the US) and have it assembled with good quality control measures in mind.

The company begins to diversify the product line

A few years later, Apple delved into the world of computer accessories such as quality laserprinters, opening the door for new business opportunities to emerge (e.g. digital and more personal desktop publishing) and faster ways to prepare and present professional looking documents (for university researchers, lecturers etc).

Apple becomes a marketing company

From the mid-1980s to the early 1990s, Apple became foremost a marketing company when a former marketing executive from Pepsi named John Sculley took the reigns of Apple's marketing department. When he first arrived, he noticed Apple set aside $15 million for marketing. Sculley realised this was not enough and managed to convince the CEOs to boost this figure to $100 million. The result was greater annual sales reaching US$11 billion and turning Apple into the biggest computer company in the world (before Dell and HP made their mark in the PC market). The success made Apple a household name across America and an iconic figure in the worldwide computer industry.

Only one problem: not enough businesses were ready to drop PCs for Apples. Why? Because Apple computers were expensive. Only well-heeled families, individuals and some private organisations earning significant income could afford the cost of glancing, let alone purchasing one of these attractive and compact machines. For everyone else, PCs remained the most logical lower cost alternative to achieve anything remotely similar to what people could do with Apple computers.

Steve Jobs leaves the company

In the mid-1990s, the last founding member — Steve Jobs — left the company. It seemed Steve wasn't needed when management wanted a way to mass produce the Apple computer and sell in greater numbers. Also, being a shareholder company, many shareholders were eager to see a significant return from their investment through higher company profits. And there was talk by PC software manufacturers suggesting the software piracy could be rife on their products making it harder to sell Apple computers to the corporate and business sector.

With all this information in mind, the new CEO of Apple rode on the success of the Apple brand and its perceived computer quality of the past hoping consumers won't notice the difference when he made the decision to lower costs by outsourcing much of the computer manufacturing offshore to places such as Taiwan (and later Japan, Mexico and China). From a purely business point-of-view, outsourcing made perfect sense. By outsourcing the computer manufacturing process, more Apple computers could be built at a lower cost (and hopefully the same quality) and within a certain time frame. And by selling the computers at the same high price that consumers were seemingly prepared to pay (and with the right marketing approach), the future for Apple looked bright.

Unfortunately prices for the machines remained too high (e.g. A$6,200 for the mid-range Apple PowerBook 5300cs computer) for a computer design that was seen as mediocre and not terribly inspiring. Then a spate of manufacturing faults entered the production line for the PowerBook 5300 and 180 models. Consumers were complaining by November 1996 of faulty trackpads and the AC power socket breaking too easily among other issues at the time. Profits suddenly plummeted and Apple was close to collapse because of the worldwide repair extension program (1) it had to implement not to mention fewer consumers purchasing the Apple computers.

Management clearly had to do something and fast to change the fortunes of the company around.

The return of Steve Jobs

Steve Jobs made his return to the company. And he didn't waste any time fixing up the first major problem he saw with Apple products — the way they looked.

Before his return, the old CEO tried to turn the company around by selling the much better constructed Apple PowerBook 1400 computers (although Apple has never given PowerBook 5300 users the option to have it replaced with a PowerBook 1400 computer even after writing letters to the Head Office for a refund or a replacement). But it wasn't enough and the design of the laptop wasn't inspiring enough to get people to buy..The decision from Jobs was clear. He had to reinvigorate the product line of Apple computers with a new innovative look, simplifying the rainbow-coloured Apple logo to a minimalistic one colour design (a symbolic way of saying to customers that the company is starting afresh, but also helping to reduce the overall costs in incorporating the logo into all new computers sold under Jobs leadership), and to apply a range of clever and simple marketing strategies to help make Apple a household name once more. He kept the idea of mass-production offshore but paid greater attention to details primarily in the area of aesthetics.

The company grew under Mr Jobs reign. People bought into the idea of good-looking computer products based on outer appearance without caring about the internal components. And the presence of one founding member of Apple at the CEO position gave confidence to shareholders that things were looking up.

And indeed there were signs to support this view.

Certainly the quality of computers were getting better, but not quite free of faults for nearly every new first generation computer model that came out and even sometimes the second or third generation of the same model series. Mr Jobs decided to introduce a 3-year extended warranty option (2) for an extra amount of money to be paid by the consumers to help build a sense of greater consumer confidence in the Apple products while at the same time keeping quiet on any inherent manufacturing faults and solving them through a replacement of the affected component with another component from the same manufacturing batch in the hope the faults are the result of isolated incidents or consumers will hopefully purchase newer Apple products.

The manufacturing faults (as consumers are led to believe) do continue to this day but to a lesser degree. They are mainly designed to help Apple resellers to make enough money through repairs.

So far the best laptops with the least amount of problems as far as consumers can tell are the latest MacBook Pro 2011 models with the Radeon graphics processor so long as they are free from hair specks and dust entering the cooling grill and onto the logic board inside the electrically-conducting aluminium unibody casing.

Sometime in 2018, the casing material will soon be changed to a new high-tech and cheap to manufacture amorphous metal designed to stop all electrical currents from flowing through the metal and thereby solving any remaining short-circuiting issues by dust and hair speaks touching the casing and the outer casing. Plus the metal will be incredibly hard to the point of being scratch resistant and stronger than anything the company has used before, and so opening up the world of super thin laptops with extra large screen sizes such as the 17-inch MacBook Pro. However this metal will not be released any time soon. As for the desktop machines, if free of faults in the first 3 to 6 months of daily and normal use, will tend to last the longest when kept unmoved on an immovable table.

Before these latest models came out, the faults were getting less obvious compared to the PowerBook 5300 and 190, but it was still there. The faults were most prominent with the "demonstration model" versions of the Apple PowerBook G3 Series "Wall Street" (Revision 1) computer where Apple Inc. would keep quiet about things like the high current the Toshiba hard disk would draw from the machine to power it causing problems later with overheating when an Apple reseller uses another hard disk with a lower current rating but the machine would not adjust the current levels. As soon as the hard drive started overheating, the read/write head inside the low-powered hard drive would become erratic and create corruption to files. Yet this would not stop certain Apple resellers from selling the dud machines to unsuspecting members of the public (mainly for the purposes of inspecting the original hard drive for various things). The hard drive fiascoe may have ended, but the idea would expand to include various models within an Apple computer series (e.g. the G3 iBook) as part of what appears to be a new secret Apple policy of some form of "in-built obsolescence" and if encouraging consumers to return the computers for repairs or purchase new ones. If consumers did not like this and have heavily invested already ion Mac software, the only other option is to pay extra for having the "extended AppleCare program" included in the package.

Part of this problem also stems from concerns about software piracy as Apple decided it was time to switch from the PowerPC G4 and G5 processors (which were getting hotter to operate safely inside laptops and desktops) to the Intel processor and building a new range of Intel Macs to the public.

The manufacturing faults would be supported by a number of Apple technicians although under anonymity to avoid losing their jobs or contracts by the Apple resellers with Apple, Inc. For example, an Apple technician who went by the name of Jonsaw with allegedly many years of experience gave his insight into the way Apple computers were being made. The quote appeared at MacFixIt.com on 29 December 2003:

"I've been repairing Macs since the beginning of 1985. I was one of the first (and maybe the first) person to fix a Mac (a 128K) outside of Apple, just as it came out of its one year warranty. I've fixed various problems with all Mac models since then, which has allowed me to get a good look inside all these models, and to see what parts break most often. I can assure anyone that Apple, like many other manufacturers, though they design many aspects of their products fabulously, seems to deliberately design, construct, and specify certain parts of certain Mac models, especially Powerbooks, iBooks, and iMacs, to fail. Most desktop Macs tend to be more sturdy, but not enough in my opinion.

As many other people have found, one primary example are Powerbook hinges. Though Apple seems to have finally gotten hinges mostly right (with exceptions like the iBook wire problem...), it took them about 10 or 11 years to do so — even the first generations of the Powerbook G4 [introduced in 2003] have hinge mechanics that are unforgivably badly designed (if the hinge doesn't break, the parts they're attached to [do] break). It didn't take them 10 or 11 years to figure out what they were doing wrong — a kid could have taken one look at these designs on the drawing board and told them: critical stress-bearing parts made too thin, and/or out of easily breakable materials, and/or with sharp right angles where stress could gain a foothold and crack, etc. Each new model Apple designed, had either the same problems, or new problems just as easy to see from the start. Designing a new model gives a manufacturer the opportunity to fix the previous model's problems, but Apple continued to make lousy hinges and a few other weak parts. It shows that Apple, though capable of learning from its mistakes, deliberately didn't put what they learned about hinges into practice for many years....

...It's basically the weird notion of planned obsolescence, which is common among other manufacturers too, which they use to justify such decisions — the idea that it's the manufacturers' business to say how long their products should be in use before they're replaced with a newer model, and so they specify parts that will last only that long or maybe a year or two longer. It's an old story. It's done in various way that can be hidden, and justified in various ways if the question of a lawsuit comes up. One way a company cleverly (or so they think) hides such practices, is to put weak parts into those areas that will be stressed the most, and when the parts break, they can say it's because that area gets stressed, instead of admitting that there's anything wrong with the design or the part's quality.

If Apple wants to sue me for slander, go right ahead. I and plenty of other people have enough proof to make whoever makes these decisions at Apple look like a fool. It's too bad, considering how good a job they do in so many other ways."

This is the strongest claim yet to support the possibility of Apple Inc. deliberately putting in obsolescence into their products in order to force consumers to buy more Apple products (or at the very least encourage users to return their products together with the hard drives to Apple for repairs and a close inspection).

UPDATE
January 2004

News from Apple Inc. at this time suggests the company wants to keep quiet on the above issues and instead emphasise how great the customer service and repairs are from Apple when you buy an Apple product and take out the extended AppleCare 3-year warranty at an additional cost to the consumer. Just so long as you provide the entire Apple product to Apple, they will quickly replace or repair anything needed to get it working again (until the next time) and have it returned within a reasonable period of time (either 3 days or a week). But God help you if your Apple product is not covered by the warranty! Talk of high-prices for repairs and replacement parts (equivalent to buying a new or second-hand computer) and long-waiting times is now becoming the norm for other Apple users in many countries given the number of problems emerging on Apple products.

Why the instability hardware problems from Apple Inc.?

Apart from the covert law enforcement purposes where Apple owners have to bring in their unusually faulty computers (often the demonstration "first in a series"" models with the original hard drive intact that weren't meant to be sold to consumers) for repairs (often requiring the original internal hard disk to be included in the warranty for inspection even though customers are not legally required to do so and even Apple stated in a manual that users can remove the hard drive in one model known as the PowerBook G3 Series "Wall Street" and "Pismo"), most design and manufacturing faults in the mid-1990s stem from the decision to let too many people have a financial share in the company while outsourcing much of the construction of the Apple computer to cheaper Asian computer manufacturers. As David Sobotta, a former Apple insider, said:

"...Apple executives had a theory that the route to success is not selling thousands of expensive things, but selling millions of very inexpensive things..." (Sobotta, David. iPod, iTunes, iPhone...I'm apples: The Sydney Morning Herald. 13-14 January 2007, p.19.)

Then between 2000 and 2003, Apple would continue to create manufacturing problems in what some critics suspect might be an unofficial policy to create obsolescence in Apple products such as the PowerBook G3 Series "Wall Street" computer, G3 iBooks and the iPod.

What were the key decisions?

Here are the key changes for Apple:

  1. There were some poor decisions in the late 1980s which led to a dramatic change in focus initially from the owners of Apple Inc. who needed money to survive in the late 1970s, to the customer throughout much of the 1980s and early 1990s, and now to the shareholders and executives of Apple Inc. in the mid-1990s and beyond.
  2. There was a great consumer demand in the late 1980s for Apple computers and not enough computers were produced in a reasonable period of time;
  3. Apple Inc. learned about the level of software piracy on some customer's hard disks. Experts in the IT industry would also highlight this problem including a number of the major software manufacturers such as Adobe Systems, Inc. and Microsoft Corporation.
  4. Apple shareholders were, and still are, pressuring Apple Inc. to maximise profit from the sale of Apple products; and
  5. Apple directors in the United States after 1993 wanted to improve only one thing that really mattered at Apple Inc. — profit, or the "bottom line".

What are the consequences of this decision?

The poor decisions has led to serious problems for customers and later to Apple Inc. in other countries outside the US with international users not buying enough Apple products.

Among the negative consequences include outsourcing of much of the manufacturing process for the sake of maximising "profit" and "product quantity" at Apple Inc resulting in an increase in the risk of producing sub-standard Apple products. We call them poor quality control measures taking place at some Asian computer manufacturers.

Another unfortunate consequence has been the radical overhaul and new formatting of the latest OS X in the hope Apple could stamp out software piracy by forcing people to buy new software.

And yet another consequence involves the creation of Apple software that would require regular updating because of security problems, general instability (e.g. removing support for G3 systems in favour of the latest G4 or G5 systems and hence making G3 computers more inherently unstable than usual such as what we see in MacOS 9.2.2 compared to MacOS 8.6 and MacOS 9.1), and by placing limitations in popular Apple software which would force customers to either update or pay extra to reactivate the software (e.g. disabling MPEG-2 plug-in after a certain date in Apple QuickTime 6.4).

This idea of regularly updating software to make them compatible with the latest OSX software or remove existing flaws (usually to be replaced by new flaws of a different nature in many cases) is suppose to be Apple's new policy of maximising profit for the company and its shareholders and to reduce what is presumably a serious software piracy problem.

What can I do to get a quality Apple computer?

If you have already bought an Apple computer (why?) and suspect it might be riddled with manufacturing and design faults courtesy of Apple Inc., there is not a great deal you can do except:

  1. avoid purchasing "demonstration models", always skip the first and usually the second versions (or manufacturing batches, eg. MacBook Pro 2011 instead of the 2007-2008 models) in a particular model range, and purchase only new Apple products you can see in the shop sealed (i.e. unopened) in the original packaging) to minimise the number of hardware-related problems;
  2. regularly purchase the extended 3-year AppleCare warranty for each new Apple computer you purchase (costing up to $500 for each machine);
  3. sell the Apple computer and buy something else (try a PC); or
  4. sign numerous petitions and establish a class action against Apple Inc. to force the company to get its act together.

As for those consumers fortunate enough not to have purchased an Apple computer (lucky buggers!), there is one lesson to learn from all of this. Never buy the latest and greatest computer (especially the so-called "demonstration models" no matter how good the price might seem to you or how trustworthy the Apple reseller might be) from an innovative computer manufacturer, even if the brand name is Apple, until the computer has been properly tested in the real world and consumers are satisfied with its quality.

Talk to professional computer users, read both PC and Mac computer magazines to learn of the testing conducted by people outside of Apple on these new computers, and do other things you consider necessary to help you determine precisely the best computer product for your needs.

And use the Trades Practices Act to argue "not of merchantable quality" to get a repair or replacement if the hardware problems appear well before you should reasonably expect the products to last.

Pushing the company in a different direction

Then Steve Jobs took the company in a different direction. He decided Apple would embark on a plan to diversify into the consumer electronics market. The aim here was to sell far more products of a lower cost for something that many people were interested in using and enjoying on a daily basis (e.g. listening to MP3 music) but always maintaining good looks and a minimalistic approach to the user interface and design. The result of this move was the development and production of the world acclaimed iPod (an MP3 player) and iPhone (a mobile phone with extra features). As a result, Apple grew to a total of 250 retail stores in nine countries, employing 35,000 people, and making worldwide annual sales of over US$32 billion by 29 September 2008.

In the latest marketing strategy to convince people to buy Apple products for 2009, Apple explains all products are designed to "work out of the box" and therefore will satisfy a lot of customers who need technology to be simple and easy to use. While marketing may be seen as a tool for satisfying the needs and wants of customers, Apple sometimes forget that satisfaction also requires users to be able to use the products for a reasonable length of time (perhaps as long as 10 or 15 years, or longer) after the purchase and be free of faults or signs of rapid deterioration.

Satisfaction is both a short-term and a long-term objective that should be in the vocabulary of all businesses trying to sell products and services.

In the wake of manufacturing faults and/or designs that are considered too flimsy or weak and likely to break through normal use, web sites have appeared to fill a need for users wanting to maintain their expensive Mac computers for longer. Among the web sites to take stand in favour of Mac users include iFixIt.com, and MacFixIt.com.

As Kyle Wiens of iFixIt.com said:

"There are some big changes afoot at iFixit. You might even call them revolutionary changes.

Seven years ago, there weren't any freely available repair manuals for Macs. Luke and I started iFixit to fill a very real need.

Since then, iFixit has become an integral part of the Apple community. Our step-by-step guides, troubleshooting forum, and service parts store have successfully helped people fix over a million Apple devices themselves!

...Our plan to fix the world is simple. We are enabling everyone to write a service manual for every kind of device — not just Macs, and not just electronics. Every thing. iFixit 2.0 is a Wikipedia of repair manuals. We are making all of our authoring tools available for free, and opening up all of our manuals for community editing."

And why is iFixIt.com doing this? As iFixIt.com said:

"What if everyone had free access to a repair manual for everything they owned? How much longer would our things last? Our mission is to give people the information, parts, and tools they need to make their things work as long as possible."

A great move!

Apple Inc. using early adopters as beta testers for first generation Apple products

In 2010, the release of the first generation iPad with its overheating processor when running movies on a hot day, poor WiFi connection, limited touch-screen keyboard, shocking iWorks applications for touch screen use and so on and dumping the product on early adopters is reminiscent of previous first generation products.

As a result, more users are coming to see the early adopters of Apple technology as the beta testers for Apple's low-cost quality control testing. And worse still, these early adopters don't know it and are quite happy to pay for the chance to tell Apple what's wrong with the products. Whereas the smart ones tend to stay back, wait and watch, and see how the products improve and compare them to the competitors.

A CNET user has accepted this view with Apple products (and can be translated equally well to other companies and industries) when he said:

"Like with most computer related products, I reckon stuff is released as beta versions for "product testing" by early adopters. AND you PAY them (in real money and emotional anguish) for the privilege of finding all the product deficiencies.

Having been around since DOS days, I remember the old adage - "Never buy anything ending in xx.0"

I am quite happy to wait for Windows 7 service pack 2 or 3 before I migrate - equally happy to wait for iPad v3 before I have a look at one in a year or so.

The automotive industry has long ago (either through people's expectations or legislation) fixed buggy hardware for FREE and generally not blamed the customers for not knowing how to drive their cars (Toyo** excepting until that embarrassing admission). Pity the computer industry doesn't have the same philosophy. As someone said in a previous comment - it's not an Apple thing or a Microsoft thing - the whole industry is tarred with the same brush.

SO... go you early adopters [AKA Beta Testers]... have the latest toy... and many thanks for sorting out the problems for the rest of us. :-)" (Ogg, Erica. Apple promises software fix for iPad Wi-Fi problems: CNET News. 11 May 2010.)

A quote like this should be an eye opener for anyone contemplating purchasing any Apple product. In other words, always wait before you buy. And never buy the first and sometimes the second generation models.

Apple Support Communities

Apple has launched a revamped version of the Apple Discussions board where you can continue to post questions and get responses from other Mac users. The new name for this service is called Apple Support Communities. There is a different layout and feel to the new web site compared to the old discussions board, but should prove to be adequate for the purposes of posting questions and getting responses.

All postings will be organised by the type of Apple product they relate to in order to help Apple to determine if a better product should be produced in the future.

We can only hope this is a new era for Apple to start focussing on the customer and understanding user experiences and learning to improve their products.

Mr Steve Jobs resigns from his CEO position at Apple, Inc.

On 24 August 2011, Mr Steve Jobs announced he would retire from the company he co-founded in the early 1980s and worked so hard to make it succeed. Although he didn't hint at the reason for his departure, many analysts believe he is battling cancer and only recently had a liver transplant. A combination of health and the stresses of running the second biggest company by market capitalisation as CEO for many years may have taken its toll on the visionary leader.

As the new CEO, Tim Cook, said in a statement to the media:

"Steve's extraordinary vision and leadership saved Apple and guided it to its position as the world's most innovative and valuable technology company."

Later, Jobs released his own statement:

"I have always said if there ever came a day when I could no longer meet my duties and expectations as Apples CEO, I would be the first to let you know. Unfortunately, that day has come. I hereby resign as CEO of Apple.

I would like to serve, if the board sees fit, as chairman of the board, director and Apple employee. I believe Apple's brightest and most innovative days are ahead of it. And I look forward to watching and contributing to its success in a new role. I have made some of the best friends of my life at Apple, and I thank you all for the many years of being able to work alongside you."

Mr Jobs is the man whose ceaseless quest for perfection and in producing the most compact, creatively inspired and intuitive Apple computers in the early days of his company is considered legendary (sometimes to the frustration of some people in management). And his determination to build up the company's bottom line when he returned as CEO while applying his good product designing skills to re-invigorate the Apple product line and with a focus on the younger market who are willing to take on new technologies from the company even if the quality of early designs needed more attention, will always be remembered.

We hope, under the leadership of Mr Cook, that consumers will see even higher quality and more durable Apple products emerging from the company and with improved customer service throughout the entire cradle to grave process of purchasing and using the products by the consumers. And just as important is to show innovation and creativity in the design of useful products.

Steve Jobs (1955 - 2011)

Sadly, on 5 October 2011, at the age of 56 years, the world lost the greatest creative genius in the hi-tech industry. Succumbing to his long battle with cancer, Steve Jobs will be remembered as the man who pushed the hi-tech industry to the very limits, creating inspiring, desirable and highly compact computers and personal devices for consumers which only those in the PC industry could emulate and keep up. Never has anyone else in the industry been able to outdo the creative abilities of Steve Jobs and succeed in selling technology-based products as well as Steve did.

It is now up to the new industrial designing team at Apple headed by Jonathan Ive to create inspiring and attractive new products. Indeed, Mr Ive has been positioned in the company by Mr Jobs to have enormous freedom in the company to create new Apple products with virtually little or no interference from the rest of management because as Mr Jobs understood, good designing is at least as critical to selling technology to consumers. All that remains in this designing equation, of course, are the practical elements of using quality electronic components and materials to ensure the best Apple product is available to every consumer who wants one and can use for as long as they wish. This quality control aspect is something the engineering department and the rest of management will have to focus and work together on. As it is about time consumers receive the best products Apple can ever produce.

The right-hand man to Mr Jobs in the designing decisions since 1996 — Jonathan Ive — will now take centre stage following the death of Mr Jobs. The world will now look to Mr Ive's leadership in designing the next inspiring Apple products of the 21st century. But we can only hope Mr Cook and his right-hand man in engineering will provide the necessary quality control assurances to ensure all new Apple products are something to be remembered in the minds of all consumers for all times.

If this next level of improvement can be achieved, there is absolutely no reason why Apple, Inc. couldn't become the biggest and most popular company in the world.