I'm sorry for Apple that it can't be a player in the PDA market, but the decision Jobs made at the time was a good business move. As several people have pointed out, the Newton was good technology by the time it was killed, but Apple (as a company) wasn't in the position to support multiple platforms right then.
The hard reality is that the company had to get back to the core of what it did best: make and sell better Macs. If Apple had been in the financial shape it is NOW, I doubt Newton would have died, but at the time, it was a wise business move when the future of the company was honestly in doubt. Business and marketing literature are filled with examples of companies that have tried to split their resources when they were weak and ended up going out of business simply because they couldn't afford to do anything right.
As for your suspicion that Jobs resented Newton because it was a Sculley project, there could be some validity to that. However, his trademarked Reality Distortion Field could have convinced people that it had been his all along if he had wanted it that way.:-)
Seriously, as much as I hate Apple losing that place in the market, it helped with survival in the dark days when the adjective "beleaguered" really WAS justified in referring to the company.
I disagree with your premise in the first place, but your application of your premise to this particular siutation is even less defensible. There is no natural resource involved in providing telephone service and the only reason the incumbent phone companies have any advantage that could be termed economy of scale is that they were given a monopoly through regulation, NOT through market action.
You're looking at the mess that has been CREATED by regulation and then claiming that MORE regulation will fix it -- and that's just plain not true. There are no "impossible circumstances" involved in providing a true market in phone service OTHER THAN those circumstances that have been CREATED by the very thing that you apparently advocate.
I'm sorry, but that's just not true. The only reason that the Baby Bells (or any other company) has a true monopoly is BECAUSE of a legacy of regulation. AT&T was given the monopoly in most of the United States in the early days (and smaller companies were given monopolies in areas where Ma Bell didn't want to go at the time).
The situation we have today (where the incumbent local carriers have de facto monopolies) exist ONLY because government got involved to keep the competition out. Contrary to what you and many people mistakenly believe, regulation does NOT bring true competition. Only unfettered markets ultimately do that.
We're in the situation where we are because of monopolistic government utility decisions years and years ago. The effects of those old decisions aren't going to go away overnight, but the market will ultimately bring competition, not bureaucrats.
The better question is why should ANY of them be regulated? The rationale for regulating them in the old days was that it was a monopoloy service. If pretty much anybody can compete -- using the Internet as the infrustructure -- why SHOULD there be any regulation of the service?
The existing phone companies like regulation because it shields them from further competition. There's no reason for them to be protected by the competition brought by new technology (which is going to lower the price of communication for consumers).
Actually, I think you'd be surprised. The last I heard, Pixar used quite an assortment of computers, but maybe someone else knows more about the specifics of it than I do. I'm sure Jobs would LIKE to use Macs for everything at Pixar, but he's enough of a businessman to use the tools that get the job done, just as Apple is pragmatic enough to use non-Apple computers for some internal needs.
Also, you might be interested to know that before he came back to Apple, there was a time when Jobs was using an IBM ThinkPad instead of a Mac. (If I remember correctly, that came from an article in Wired magazine, but it's been awhile, so I could be wrong.)
If you'll look at the story again, you'll see that the article only referenced Apple by mentioning that it was "Apple CEO Steve Jobs" who bought the company. Apple has never owned Pixar or had any business relationship with it, other than sharing CEOs, unless I am badly mistaken.
David
To be honest, if I were a competitor of one of Lucas' companies, I would be happy to see this consolidation, assuming that they're truly going to put one management team in charge of the whole thing. Here's why.
1) As independent operations, each of those companies has a clear focus. The management team at the sound company knows that its goal is to provide the best sound work possible in order to get business from other production companies making films. The video game unit is focusing on making money on its games. The ILM people are focused on effects and selling those effects to other studios. From a business point of view, combining will tend to make those units lose focus, because they're now going to be looking at what the new "big boss" wants instead of focusing on individual goals. See Al Ries' book, "Focus," for a good discussion of why focus is essential to a company. (Actually, see almost any of the work from Ries and Jack Trout for more support of this point, going back to their work in the '70s on positioning.)
2) This is going to potentially create sales problems for the divisions that sell to other movie studios. As it has been, a studio that bought its special effects from ILM was dealing with a specialist company, NOT a competing studio. ILM's specialist competitors are now going to be saying (to other studios), "Why would you want to use LucasFilm? They're your competitor." You might say that it was that way already, but there's a very real difference when you're dealing with a company with a different name and different management team. If a studio is angry at LucasFilm for some action that it's taken in one area, they'll hold it against the whole company since they'll be one combined operation.
I know this is being pitched as something to streamline operations and reasons like that, but I would bet that the original idea originated with the bean counters for reasons involving taxes or other accounting reasons. My bet is that the decision was made for accounting reasons and is being sold as something to help operations.
I honestly don't see any operational advantage and I see multiple disadvantages. It will be interesting to see how the combined company does in the future (as compared to how its doing in its current structure), but since the numbers are private, we might never know.
We're going to have to agree to disagree, because our underlying principles (and experiences about how government works in the real world) are obviously radically different.
I must say, though, that you're badly misrepresenting libertarian views if you argue that libertarians generally believe the market is perfect. They simply believe it's far preferable to any other ALTERNATIVE, especially government.
I meant the comment about anarchy in the same spirit as the person (whose name I forget) who said that democracy was the worst possible system except for all the others.:-) I don't truly favor anarchy, but it's scary to watch the sausage being made.:-)
Actually, the only way to see my argument as contradictory (as you apparently do) is if you believe that ANY system is perfect. When I say that the market works, I don't mean that it keeps all the incompetent people out. I'm simply saying that it works better (or at LEAST as well, for the sake of argument) as government licensing -- while government-mandated licensing creates the barriers to entry that I mentioned.
I do NOT maintain that the market keeps every incompetent person out of business. But what it DOES do is let people KNOW that it is THEIR responsibility to choose someone competent, not rely on some government bureaucrat who supposedly knows who is (and who is not) competent to fix your computer.
The fact that you can show the market is less than perfect doesn't make a government-mandated system any more reasonable, nor does it negate the real-world consequences of such a system. Your idealism and good intentions don't change those facts.
BTW, when I referred to professional groups or unions (in my original response), I had a typo which could have made it appear I was JUST talking about unions, but the word was supposed to be "or" rather than "of." Unions (typically in the form of Democrats) and business (typically in the form of Republicans) both tend to pay off politicians to get protection from competitors, unfortunately.
I'm a political consultant, and I'm not sure whether to laugh at the ignorance implied by the proposed solution or calmly explain why things work the way they do. I'm trying hard to remember that some people actually believed the garbage they heard in seventh grade civics classes and that they haven't actually dealt with real politicians enough to know what motivates such laws.
Laws requiring people to be licensed to do certain things (such as repair plumbing or cut hair) are sold to the public as protection for the public, but, in reality, those regulations are about protecting the people already in a business and keeping prices high for the service. If you honestly think that regulations such as you're proposing will keep out incompetent people, you clearly haven't seen some of the bad haircuts that I've seen from fully licensed haircutters. Do you think the licensing keeps incompetent plumbers from working? Do you think that licensing keeps incompetent people in almost ANY field from working?
Government licensing is popular because it provides barriers to entry into a profession. It makes it harder to compete with the people who are already doing it (and tends to make prices for those services HIGHER than they otherwise would be). But all those things do is create hoops for people to jump through. Any idiot can memorize enough basic facts long enough to get a real estate license, for instance, but that doesn't mean that person is going to be a competent agent. A licensed haircutter isn't necessarily a good haircutter. And a licensed plumber isn't necessarily a good plumber.
The market is what works. If somebody is good at something, you recommend him or her to your friends -- and that person gets more business. If somebody is lousy at something, word gets around and the person has trouble getting work, until he's getting work only from people who are more interested in a cheap price than a quality job. The same is true in ANY field -- even things where we like to pretend that licensing provides a level playing field for everyone, such as with physicians.
Politicians like licensing requirements, because they allow them to tell the voters that they're protecting them, while they're really taking contributions from professional groups of union groups which are eager to lock out competition.
Giving the government the power to decide who is competent to do ANYTHING is crazy. The longer I'm around politics, the more I think that anarchy is a darn good idea.:-)
Slashdot Mirror
I'm sorry for Apple that it can't be a player in the PDA market, but the decision Jobs made at the time was a good business move. As several people have pointed out, the Newton was good technology by the time it was killed, but Apple (as a company) wasn't in the position to support multiple platforms right then.
:-)
The hard reality is that the company had to get back to the core of what it did best: make and sell better Macs. If Apple had been in the financial shape it is NOW, I doubt Newton would have died, but at the time, it was a wise business move when the future of the company was honestly in doubt. Business and marketing literature are filled with examples of companies that have tried to split their resources when they were weak and ended up going out of business simply because they couldn't afford to do anything right.
As for your suspicion that Jobs resented Newton because it was a Sculley project, there could be some validity to that. However, his trademarked Reality Distortion Field could have convinced people that it had been his all along if he had wanted it that way.
Seriously, as much as I hate Apple losing that place in the market, it helped with survival in the dark days when the adjective "beleaguered" really WAS justified in referring to the company.
David
I disagree with your premise in the first place, but your application of your premise to this particular siutation is even less defensible. There is no natural resource involved in providing telephone service and the only reason the incumbent phone companies have any advantage that could be termed economy of scale is that they were given a monopoly through regulation, NOT through market action.
You're looking at the mess that has been CREATED by regulation and then claiming that MORE regulation will fix it -- and that's just plain not true. There are no "impossible circumstances" involved in providing a true market in phone service OTHER THAN those circumstances that have been CREATED by the very thing that you apparently advocate.
David
I'm sorry, but that's just not true. The only reason that the Baby Bells (or any other company) has a true monopoly is BECAUSE of a legacy of regulation. AT&T was given the monopoly in most of the United States in the early days (and smaller companies were given monopolies in areas where Ma Bell didn't want to go at the time).
The situation we have today (where the incumbent local carriers have de facto monopolies) exist ONLY because government got involved to keep the competition out. Contrary to what you and many people mistakenly believe, regulation does NOT bring true competition. Only unfettered markets ultimately do that.
We're in the situation where we are because of monopolistic government utility decisions years and years ago. The effects of those old decisions aren't going to go away overnight, but the market will ultimately bring competition, not bureaucrats.
David
The better question is why should ANY of them be regulated? The rationale for regulating them in the old days was that it was a monopoloy service. If pretty much anybody can compete -- using the Internet as the infrustructure -- why SHOULD there be any regulation of the service?
The existing phone companies like regulation because it shields them from further competition. There's no reason for them to be protected by the competition brought by new technology (which is going to lower the price of communication for consumers).
David
Actually, I think you'd be surprised. The last I heard, Pixar used quite an assortment of computers, but maybe someone else knows more about the specifics of it than I do. I'm sure Jobs would LIKE to use Macs for everything at Pixar, but he's enough of a businessman to use the tools that get the job done, just as Apple is pragmatic enough to use non-Apple computers for some internal needs.
Also, you might be interested to know that before he came back to Apple, there was a time when Jobs was using an IBM ThinkPad instead of a Mac. (If I remember correctly, that came from an article in Wired magazine, but it's been awhile, so I could be wrong.)
David
If you'll look at the story again, you'll see that the article only referenced Apple by mentioning that it was "Apple CEO Steve Jobs" who bought the company. Apple has never owned Pixar or had any business relationship with it, other than sharing CEOs, unless I am badly mistaken. David
To be honest, if I were a competitor of one of Lucas' companies, I would be happy to see this consolidation, assuming that they're truly going to put one management team in charge of the whole thing. Here's why.
1) As independent operations, each of those companies has a clear focus. The management team at the sound company knows that its goal is to provide the best sound work possible in order to get business from other production companies making films. The video game unit is focusing on making money on its games. The ILM people are focused on effects and selling those effects to other studios. From a business point of view, combining will tend to make those units lose focus, because they're now going to be looking at what the new "big boss" wants instead of focusing on individual goals. See Al Ries' book, "Focus," for a good discussion of why focus is essential to a company. (Actually, see almost any of the work from Ries and Jack Trout for more support of this point, going back to their work in the '70s on positioning.)
2) This is going to potentially create sales problems for the divisions that sell to other movie studios. As it has been, a studio that bought its special effects from ILM was dealing with a specialist company, NOT a competing studio. ILM's specialist competitors are now going to be saying (to other studios), "Why would you want to use LucasFilm? They're your competitor." You might say that it was that way already, but there's a very real difference when you're dealing with a company with a different name and different management team. If a studio is angry at LucasFilm for some action that it's taken in one area, they'll hold it against the whole company since they'll be one combined operation.
I know this is being pitched as something to streamline operations and reasons like that, but I would bet that the original idea originated with the bean counters for reasons involving taxes or other accounting reasons. My bet is that the decision was made for accounting reasons and is being sold as something to help operations.
I honestly don't see any operational advantage and I see multiple disadvantages. It will be interesting to see how the combined company does in the future (as compared to how its doing in its current structure), but since the numbers are private, we might never know.
David
We're going to have to agree to disagree, because our underlying principles (and experiences about how government works in the real world) are obviously radically different.
I must say, though, that you're badly misrepresenting libertarian views if you argue that libertarians generally believe the market is perfect. They simply believe it's far preferable to any other ALTERNATIVE, especially government.
David
I meant the comment about anarchy in the same spirit as the person (whose name I forget) who said that democracy was the worst possible system except for all the others. :-) I don't truly favor anarchy, but it's scary to watch the sausage being made. :-)
Actually, the only way to see my argument as contradictory (as you apparently do) is if you believe that ANY system is perfect. When I say that the market works, I don't mean that it keeps all the incompetent people out. I'm simply saying that it works better (or at LEAST as well, for the sake of argument) as government licensing -- while government-mandated licensing creates the barriers to entry that I mentioned.
I do NOT maintain that the market keeps every incompetent person out of business. But what it DOES do is let people KNOW that it is THEIR responsibility to choose someone competent, not rely on some government bureaucrat who supposedly knows who is (and who is not) competent to fix your computer.
The fact that you can show the market is less than perfect doesn't make a government-mandated system any more reasonable, nor does it negate the real-world consequences of such a system. Your idealism and good intentions don't change those facts.
BTW, when I referred to professional groups or unions (in my original response), I had a typo which could have made it appear I was JUST talking about unions, but the word was supposed to be "or" rather than "of." Unions (typically in the form of Democrats) and business (typically in the form of Republicans) both tend to pay off politicians to get protection from competitors, unfortunately.
David
I'm a political consultant, and I'm not sure whether to laugh at the ignorance implied by the proposed solution or calmly explain why things work the way they do. I'm trying hard to remember that some people actually believed the garbage they heard in seventh grade civics classes and that they haven't actually dealt with real politicians enough to know what motivates such laws.
:-)
Laws requiring people to be licensed to do certain things (such as repair plumbing or cut hair) are sold to the public as protection for the public, but, in reality, those regulations are about protecting the people already in a business and keeping prices high for the service. If you honestly think that regulations such as you're proposing will keep out incompetent people, you clearly haven't seen some of the bad haircuts that I've seen from fully licensed haircutters. Do you think the licensing keeps incompetent plumbers from working? Do you think that licensing keeps incompetent people in almost ANY field from working?
Government licensing is popular because it provides barriers to entry into a profession. It makes it harder to compete with the people who are already doing it (and tends to make prices for those services HIGHER than they otherwise would be). But all those things do is create hoops for people to jump through. Any idiot can memorize enough basic facts long enough to get a real estate license, for instance, but that doesn't mean that person is going to be a competent agent. A licensed haircutter isn't necessarily a good haircutter. And a licensed plumber isn't necessarily a good plumber.
The market is what works. If somebody is good at something, you recommend him or her to your friends -- and that person gets more business. If somebody is lousy at something, word gets around and the person has trouble getting work, until he's getting work only from people who are more interested in a cheap price than a quality job. The same is true in ANY field -- even things where we like to pretend that licensing provides a level playing field for everyone, such as with physicians.
Politicians like licensing requirements, because they allow them to tell the voters that they're protecting them, while they're really taking contributions from professional groups of union groups which are eager to lock out competition.
Giving the government the power to decide who is competent to do ANYTHING is crazy. The longer I'm around politics, the more I think that anarchy is a darn good idea.
David