Steve Jobs Steps Down the First Time: The 1985 Press Coverage

By  |  Thursday, August 25, 2011 at 10:08 am

In 1985, John Sculley–Apple’s president and Steve Jobs’ partner and confidante–became frustrated with Jobs’ management style. He forced Jobs into a role as Apple’s chairman that was designed to prevent him from making any decisions. A few months later, Jobs resigned and founded NeXT. And that, it seemed, was that.

The saga got a lot of coverage in the press–not as much as this week’s Jobs news, but a lot. It’s fascinating to look back at it. And I don’t blame anyone who failed to understand the implicates of Jobs leaving back then or even cheered his exodus. I mean, who would have believed you if you’d outlined the story to come?

Here’s InfoWorld’ Kevin Strehlo, in “Shuffle Could Aid Apple,” June 24th 1985, part of a cover package on how Sculley forced Jobs into a role as chairman that involved no product responsibility:

Employees in the field, away from daily news reports that dwell on the dark specter of layoffs, seem ebullient. “At last we have someone who is watching the bottom line,” says a nearly five-year Apple veteran about the rise of Sculley. “He”s brought accountability to an organization in which it’s been lacking for five years.”

“I think Apple is making the transition from one phase of its life to the next. I don’t know that the image of a leader clad in a bow tie, jeans, and suspenders would help us survive in the coming years.”

The Miami News, in a newsbrief on June 27th, 1985:

Sculley, who consolidated control at Apple during the reorganization May 31 and reduced the power of chairman and founder Steve Jobs, spoke of several kay people in the company without mentioning Jobs. “We have put our individual egos aside and are putting teamwork in place.”

[snip]

Those steps, which include hiring managers from other companies, could transform the free-wheeling Apple created by Jobs into a more bureaucratic company. But Sculley says he’s convinced “a more disciplined environment will actually help us get innovative hints done quickly and effectively.”

The New York Times’ Andrew Pollack, in “Apple Computer Entrepreneur’s Rise and Fall,” September 19th 1985:

Mr. Sculley has declined to comment on Mr. Jobs’s resignation.

But in an interview today, William V. Campbell, an executive vice president, said the company did not need Mr. Jobs. ”We’ve been without Steve Jobs for the better part of four months,” he said, referring to the period since Mr. Jobs lost his operating responsibilities. ”Since that time we’ve been doing just fine.”

Mr. Jobs’s resignation culminates a tumultuous power struggle with Mr. Sculley that began earlier this year as Apple’s fortunes started to decline, a power struggle that Mr. Sculley has compared to a real-life version of ”Dynasty,” the television program.

[snip]

Apple, while having a solid management, still might miss Mr. Jobs. The company is weak in top engineering talent to guide product development. Moreover, more traditional managers like Mr. Sculley have often proved no more adept at running technology companies than the original entrepreneurs. Some analysts and former employees are worried that Apple is losing its spark and becoming stodgy, a process some refer to as ”Scullification.”

”The great sadness and the great tragedy” of the departure of Mr. Jobs from Apple, Mr. Moritz [Michael Moritz, author of a book on Apple and today a legendary venture capitalist] said, ”is that both the company and he personally would be better off if they were still together.”

Another Times story by Pollack from three days later:

No one expects any dramatic changes. Long before Mr. Jobs’s resignation last week, he had been pushed aside as an active executive, leaving Mr. Sculley to run the company as he saw fit. In addition, product direction for the next six months to a year is already fairly well set.

But problems could arise in a year or two, when the time comes to develop completely new products. Almost all analysts and company officials say that Mr. Jobs lent a certain creative spark and vision to Apple, as exemplified in his leadership in the development of the Macintosh computer, a project he pushed with such passion that he neglected other Apple models. ”He has always been the company dynamo, the company personality,” said Michael Moritz, author of an Apple history. Some suggest that Apple sans Jobs will be just another company.

Mr. Sculley will hear none of that. ”We have the foundations in place for a really great Apple,” he said on Friday, in one of the first interviews he has granted since emerging victorious from his struggle with Mr. Jobs. ”We talk about vision and what Steve contributed to vision, and it’s an immense contribution, no doubt about it,” said Mr. Sculley. He sounded sometimes bitter but usually reflective about the souring of his relationship with the young man who founded Apple in his parents’ garage in the mid-1970’s. Mr. Jobs. developed that first computer with his friend Stephen Wozniak, who left Apple last February in a disagreement with his partner over priorities.

”Computers were big boring blue boxes until Steve Jobs came along,” Mr. Sculley said. And Apple will continue to be driven by the same vision of making computers for the individual in a youth-oriented company, he asserted. ”But people tend to confuse vision with innovation,” Mr. Sculley added. ”The real question is innovation, and most of the innovation, including the innovations in Macintosh, came from a lot of people.”

The San Jose Mercury News, in “Sculley: No Role for Jobs in Running Apple,” July 25th 1985:

John Sculley, Apple Computer Inc.’s president and chief executive officer, said Wednesday: “There is no role for Steve Jobs in the running of this company either today or in the future . . . but there is a role for Steve Jobs as chairman of the board.”
Sculley’s comments came after a meeting with securities analysts in Cupertino.

Sculley described Apple’s recent reorganization as painful but necessary. Chairman and co-founder Steven P. Jobs was removed from day-to-day operating responsibilities in the restructuring about seven weeks ago.

”I didn’t come to Apple with the intention of taking Apple away from Steve Jobs,” Sculley said.

”But it became increasingly clear that Steve and I had two very different ideas on how the company ought to be run.”

He said, “the outcome is very clear.”

Fortune’s Bro Uttal, in “Behind the Fall of Steve Jobs,” August 5th 1985:

Until June, Jobs led the development and marketing of the Macintosh computer, an easy-to-use, technologically advanced machine on which Apple has staked its future. Many insiders are shocked by his removal; they fear Apple has lost the spirit and vision that made it into a business phenomenon. Says one: ”They’ve cut the heart out of Apple and substituted an artificial one. We’ll just have to see how long it pumps.”

What Apple must do is hold together and carry out the latest product and marketing plans. To remain a strong contender in the long run, the company will also need the kinds of breakthrough products to which Jobs is devoted. Though Apple hopes to retain Jobs, it’s unclear whether he will stay on. In recent weeks he has seemed content to perform ambassadorial roles — promoting the Macintosh in French universities and jetting to the Soviet Union to check out opportunities for selling computers.

But Jobs has also talked of selling his stock — recently worth about $120 million — to endow a new R&D outfit that he would head. If he does leave, the company will lose a champion of innovation, a foe of bureaucracy, and a priceless proselytizer to the rest of the world.

The Washington Post’s T.R. Reid, in  a prescient piece titled “Sculley Means Trouble in Apple’s Orchard,” August 5th 1985:

In my view, the directors of Apple have made an outrageous and potentially fatal blunder in taking their company away from the founding father than turning it over to a generic marketing man. The computer industry is littered with the corpses of promising companies that were managed into oblivion by marketing “experts” who had no particular feel for silicon and software.

[snip]

The distinguishing thing about Steven Jobs is that he has a vision, a pervasive philosophy, about the role of personal computers in modern life. His whole professional career has been an effort–remarkably successful, at that–to bring that vision to life.

[snip]

Over the long haul, Apple sans Steven Jobs is not going to be a pretty sight The company has sold its birthright for a mess of Pepsi–and made a crucial blunder in doing so.

TIME’s Barbara Rudolph, in “Shaken to the Very Core,” September 30th 1985, which calls Jobs “brash,” “brilliant,” and “petulant,” among other things:

Silicon Valley remains rife with speculation about how well Apple will function without Jobs. Sculley is confident: “Steve’s great contribution was recognizing that computers were tools for individuals and not large blue boxes for institutions. That doesn’t change, whether Steve is here or not.” Some observers, noting that Apple stock jumped $1 a share after Jobs’ resignation became known, believe his departure may be a blessing for the company. Says David Gold, a Palo Alto venture capitalist: “It’s good news for Apple that | he’s out of their hair. The loss of a few employees is probably a small price to pay to have Steve Jobs going off and doing something else.” But Nolan Bushnell, who founded Atari and subsequently launched and left several other firms, including Pizza Time Theater, is not so sure. Says he: “Where is Apple’s inspiration going to come from? Is Apple going to have all the romance of a new brand of Pepsi?”

I wonder how this week’s coverage will read in 2037–or even a year from now?

 
19 Comments


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19 Comments For This Post

  1. DREGstudios Says:

    Jobs is done but left his mark on every corner of wireless technology. It only leaves us asking who won the war between the two titans of modern computer technology? Steve Jobs vs. Bill Gates / Apple vs. Microsoft– check out my rendering of an epic match-up of their cyborg selves on my artist's blog at http://dregstudiosart.blogspot.com/2011/08/end-of

  2. theguycalledtom Says:

    I've been wondering where the next Steve Jobs might come from. Would a young Steve Jobs today be trying to make his way to the top by working under the shadow of Tim Cook? I don't think so, the next Steve Jobs is out there creating a new start-up. Perhaps hoping to be acquired by a company like Apple, but I'm sure he's not within Apple already.

  3. Gaming Says:

    On today's patent swamp it is impossible for a new seed to bloom.

  4. boupinel Says:

    So the NYTimes was on the mark, the Washington Post prescient, and the business media totally off. I'd enjoy seeing the Wall Street Journal's reaction if you could post it……

  5. bendeho Says:

    Jobs was a petulant wanker dilletante back then, and forced his own ouster on himself in a misguided power struggle. He needed to go. Nothing he really did before coming back in 1997 helped the company much back then.

  6. zawy Says:

    I was a senior in high school when Steve resigned. It was obvious to young techies that Apple had made a stupendous moral error in not letting Steve run Apple. As Wozniak, I believe, said: "They ripped the heart out of Apple." In a cult of mac interview Sculley said "when Steve left" which shows he's still an a-hole. He threatened the board with resignation if they did not remove Jobs as VP and general manager of the Macintosh division, after experiencing "problems" with Steve trying to exert too much influence outside of his job title.

  7. Andy Says:

    It's good that you ask. I just got done reading an article from 'Crunch about the whole issue which suggest that there might not need to be another Steve jobs.
    http://techcrunch.com/2011/08/26/one-more-thing/

  8. nasholla Says:

    'Nothing he really did before coming back…helped the company much back then'

    'He still somehow managed to grow a company to take it public in 1980 which had 1,000 employees and a market value of over $1bn. Not bad for a 'petulant wanker'.

  9. Jon Says:

    really? have you not heard of NeXTStep? Cause it defined the modern Mac, and its what Steve did before coming back in 1997…

  10. Max Harris Says:

    I disagree. If what you say is actually true, then where did Google, Twitter, Facebook, etc. come from? We have essentially the same patent system that existed ten or twenty years ago.

    I submit that without the essential function of patents and copyrights, with both serve in essence to protect the individual rights of creators, no seeds would have been able to bloom. Property rights aren't a right to stuff – they are rights to the freedom to act. If you bring an idea into existence, the particular form in which you do it must be protected (because your physical and spiritual survival requires money and correct attribution from those who choose to benefit from your unique creation). Among other things, copyrights and patents provide protection against misappropriation of the market you've created for your unique creation and form of expressing ideas.

  11. Hamranhansenhansen Says:

    What we need is a billion more Steve Jobs. Every business person should be studying Apple under Steve Jobs as CEO, 1997-2011.

    Many technology entrepeneurs, including the Google founders, set out to be the next Steve Jobs.

  12. Hamranhansenhansen Says:

    Totally wrong. A new seed just bloomed. Apple is the NEWEST entrant into tablet PC's and phones, and they are also by far the most profitable, taking the majority of the profits in both markets. So that proves you wrong. Not only is it possible for a new entrant to get in, it is possible for them to dominate. Apple just did it.

    Motorola, Samsung, HTC, RIM, Nokia … they have all been making phones for a decade or more. HP, Dell, Acer, Lenovo have all been making tablet PC's for a decade or more. Apple did not steal their work and complain about patents. Instead, Apple made the next generation versions of these products and patented those. That is what patents are FOR. Every company should be trying right now to invent the next phone after iPhone and patent that, not copying iPhone and complaining it is patented.

    The current "patent storm" is BS marketing that is being used to excuse the almost complete lack of profitability in the phone and tablet PC markets outside of Apple. The problem is not that Google lacks PATENTS, it is that they lack INVENTIONS. They deliberately copied whatever they wanted for Android with the idea that there would be so much money later that the lawsuits would be easy to pay off. However, Apple took all the profits in the phone market, so Android has sold very few profitable phones, and overall is not profitable. So there is now the potential that the lawsuits that Google expected all along, that they considered as a good way to shop for technologies, may ruin Google completely. That is why they are whining.

    They are not just accused of violating the engineering patents that everyone is talking about … there are also copyrights, design patents, software licenses. Both by big corporations and small open source software projects.

  13. Hamranhansenhansen Says:

    Before he left, he managed the development of the Apple II, the Mac, and the "Big Mac" project that became NeXT after he left. When he left, Apple's computer line was essentially forked: Apple kept Mac OS, and Jobs took NeXT. When he came back, he essentially reunited the 2 and you get Intel Mac, iPhone, iPad, Apple TV. Without the NeXT work, you don't get an iPhone. Sorry.

    One of the reasons he was ousted is he viewed the Mac as a low-end "iMac" -type machine and wanted to build a "Mac Pro" platform with Unix core so it could support the Internet, and ultimately, improve the Mac by moving technology downstream from the Mac Pro. Apple management wanted to sell the Mac as a high-end machine. So what he has done since he came back is what he was doing when he was ousted. If he was not ousted, then Mac OS X would have shipped alongside Windows 3.1, not Windows XP.

    PS when you look down on someone as accomplished as Jobs, it's only absurd. Whether you like his work or not, you cannot doubt his accomplishments. If his work is not for you, just say it's not for you, or just say nothing.

  14. Hamranhansenhansen Says:

    Splitting Apple into Apple and NeXT was a terrible idea. So much so, that they had to be reunited in order to start functioning correctly again. They were both hopping around on one leg.

    You can clearly see the iMac goes back to the original compact Mac, MacBook Pro goes back to the original PowerBook, iPhone/iPad go back to Newton, but Mac Pro and OS X and Xcode and even the Web go back to the NeXT Cube.

    Not to take away from the job Steve Jobs did over the past 15 years, but I remember when Apple bought NeXT, I thought, "they have 98% of all the cool software or hardware in the world." They had a lot of tools to work with, but all totally disorganized and in disrepair. Almost everything else in the world was DOS at that time. So it was great to see them become such great stewards of that technology.

  15. Arthur Says:

    I remember at that time reading Sculley's comments on how Apple would make better computers if it were a "more standard" corporation, and I just thought "wow… and nobody ousts this man?". Note that Jean-Louis Gassée said the same stupid stuff a few years later.

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  18. payday UK Says:

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  19. Electric Kettles Says:

    Jobs was a petulant wanker dilletante back then, and forced his own ouster on himself in a misguided power struggle. He needed to go. Nothing he really did before coming back in 1997 helped the company much back then.