Apple Inc. history

The company introduced the Apple II microcomputer in March 1977. A few years later, in 1983, it introduced the Lisa, the first commercial personal computer to employ a graphical user interface (GUI), which was influenced in part by the Xerox Alto. Lisa was also the first personal computer to have the mouse. In 1984, the Macintosh was introduced, which arguably advanced the concept of a new user-friendly graphical user interface. Apple's success with the Macintosh became a major influence in the development of graphical interfaces elsewhere, with major computer operating systems, such as the Commodore Amiga, and Atari ST, appearing on the market within two years of the introduction of the Macintosh.

In 1991, Apple introduced the PowerBook line of portable computers. The 1990s also saw Apple's market share fall as competition from Microsoft Windows and the comparatively inexpensive IBM PC compatible computers that would eventually dominate the market. In the 2000s, Apple expanded its focus on software to include professional and prosumer video, music, and photo production solutions, with a view to promoting their products as a "digital hub". It also introduced the iPod, the most popular digital music player in the world.

1976 to 1980: The early years

The Apple I, Apple's first product. Sold as an assembled circuit board, it lacked basic features such as a keyboard, monitor, and case. The owner of this unit added a keyboard and a wooden case.

Apple was founded on April 1, 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne (and later incorporated January 3, 1977 without Wayne, who sold his share of the company back to Jobs and Wozniak) to sell the Apple I personal computer kit. They were hand-built by Steve Wozniak in the living room of Jobs' parents' home, and the Apple I was first shown to the public at the Homebrew Computer Club. Eventually 200 computers were built. The Apple I was sold as a motherboard (with CPU, RAM, and basic textual-video chips) — not what is today considered a complete personal computer. The user was required to provide two different AC input voltages (the manual recommended specific transformers), wire an ASCII keyboard (not provided with the computer) to a DIP connector (providing logic inverter and alpha lock chips in some cases), and to wire the video output pins to a monitor or to an RF modulator if a TV set was used. The Apple I went on sale in July 1976 and was market-priced at $666.66.

Jobs approached a local computer store, The Byte Shop, which ordered fifty units and paid US$500 for each unit after much persuasion. He then ordered components from Cramer Electronics, a national electronic parts distributor. Using a variety of methods, including borrowing space from friends and family and selling various items including a Volkswagen Type 2 bus, Jobs managed to secure the parts needed while Wozniak and Ronald Wayne assembled the Apple I.

The Apple II was introduced on April 16, 1977 at the first West Coast Computer Faire. It differed from its major rivals, the TRS-80 and Commodore PET, because it came with color graphics and an open architecture. While early models used ordinary cassette tapes as storage devices, this was quickly superseded by the introduction of a 5 1/4 inch floppy disk drive and interface, the Disk II.


Another key to business for Apple was software. The Apple II was chosen by programmers Dan Bricklin and Bob Frankston to be the desktop platform for the first "killer app" of the business world—the VisiCalc spreadsheet program. VisiCalc created a business market for the Apple II, and the corporate market attracted many more software and hardware developers to the machine, as well as giving home users an additional reason to buy one—compatibility with the office. (See the timeline for dates of Apple II family model releases—the 1977 Apple II and its younger siblings the II+, IIe, IIc, and IIGS.)

According to Brian Bagnall's book, "On the Edge" (pp. 109-112), Apple exaggerated its sales figures, and Apple was a distant third place until VisiCalc came along. VisiCalc was first released on Apple II because Commodore and Tandy computers were tied up in VisiCalc's software development office due to their popularity. VisiCalc's association with Apple was thus pure happenstance, not a technical decision. Even after VisiCalc, Apple II did not surpass the Tandy TRS-80, whose sales were helped by the large number of Radio Shack stores. However, VisiCalc did put Apple ahead of Commodore's PET, at least in the US. (Commodore later regained the lead for a while with the Commodore 64 in the mid 80s, the best selling specific model of computer to date.)

By the end of the 1970s, Jobs and his partners had a staff of computer designers and a production line. The Apple II was succeeded by the Apple III in May 1980 as the company struggled to compete against IBM and Microsoft in the lucrative business and corporate computing market. The designers of the Apple III were forced to comply with Jobs' request to omit the cooling fan, and this ultimately resulted in thousands of recalled units due to overheating.An updated version, the Apple III+, was introduced in 1983, but it was also a failure due to bad press and wary buyers.

Apple's sustained growth during the early 1980s was partly due to its leadership in the education sector, attributed to their adaptation of the programming language LOGO, used in many schools with the Apple II. The drive into education was accentuated in California with the donation of one Apple II and one Apple LOGO software package to each public school in the state. The deal concluded between Steve Jobs and Jim Baroux of LCSI, and having required the support of Sacramento, established a strong and pervasive presence for Apple in all schools throughout California. The initial conquest of education environments was critical to Apple's acceptance in the home where the earliest purchases of computers by parents was in support of children's continued learning experience.

1981 to 1989: Lisa and Macintosh

The rebel from Apple's 1984 ad, set in a dystopian future modeled after the Orwell novel Nineteen Eighty-Four, set the tone for the introduction of the Macintosh

Jobs and several other Apple employees including Jef Raskin visited Xerox PARC in December 1979 to see the Alto computer. Xerox granted Apple engineers three days of access to the PARC facilities in return for selling them US$1 million in pre-IPO Apple stock (approximately US$18 million net).

It is said that Jobs was immediately convinced that all future computers would use a GUI, and decided to turn over design of Apple's next project, the Apple Lisa, to produce such a device. The Lisa was named after Jobs' daughter (however, a bacronym, Local Integrated Software Architecture, was coined). He was eventually pushed from the group due to infighting, and instead took over Jef Raskin's low-cost computer project, the Macintosh. Branding the new effort as the product that would "save Apple", an intense turf war broke out between the Lisa's "corporate shirts" and Jobs' Macintosh "pirates", both teams claiming they would ship first and be more successful. In 1983 the Lisa team won the race and Apple introduced the first personal computer to be sold to the public with a GUI. However, the Lisa was a commercial failure as a result of its high price tag (US$9,995) and limited software titles.

The Macintosh 128K, the first Macintosh computer

In 1984, drawing upon its experience with the Lisa, Apple next launched the Macintosh. Its debut was announced by a single national broadcast of the now famous US$1.5 million television commercial, "1984", based on George Orwell's novel Nineteen Eighty-Four. The commercial was directed by Ridley Scott and aired during Super Bowl XVIII on January 22, 1984. Jobs' intention with the ad was to represent the IBM PC as Big Brother, and the Macintosh as a nameless female action hero portrayed by Anya Major. While the Macintosh initially sold well, follow-up sales were not particularly strong. The machine's fortunes changed with the introduction of the LaserWriter, the first laser printer to be offered at a reasonable price point, and PageMaker, an early desktop publishing (DTP) package. The Mac was particularly powerful in this market due to its advanced graphics capabilities, which were already necessarily built-in to create the intuitive Macintosh GUI. It has been suggested that the combination of these three products was responsible for the creation of the DTP market. As DTP became widespread, Apple's sales reached a series of new highs, and the company had its initial public offering on September 7, 1984.

An internal power struggle developed between Jobs and new CEO John Sculley in 1985. Apple's board of directors sided with Sculley and Jobs was removed from his managerial duties. Jobs later resigned from Apple and founded NeXT Inc., a computer company that built machines with futuristic designs and ran the UNIX-derived NeXTStep operating system. Although powerful, NeXT computers never caught on with buyers, due in part to their high purchase price.

1989 to 1991: The Golden Age

The Macintosh Portable was Apple's first "portable" Macintosh computer, released in 1989.

Having learned several painful lessons after introducing the bulky Macintosh Portable in 1989, Apple introduced the PowerBook in 1991, which established the modern form and ergonomic layout of the laptop computer. The same year, Apple introduced System 7, a major upgrade to the operating system which added color to the interface, and introduced a number of new networking capabilities. It would remain the architectural basis for Mac OS until 2001.

The success of the PowerBook and several other Apple products during this period led to increasing revenue. For some time, it appeared that Apple could do no wrong, introducing fresh new products and generating increasing profits in the process. The magazine MacAddict named the period between 1989 to 1991 the "first golden age" of the Macintosh. However, the continuing development of Microsoft Windows had given birth to an interface that was competitive with Apple's. Combined with a huge base of low-cost computers and peripherals and an improving software suite, an increasing number of potential customers turned to the "Wintel" standard.

Apple, relying on high profit margins to maintain their massive R&D budget, never developed a clear response. Instead they sued Microsoft for theft of intellectual property, in Apple Computer, Inc. v. Microsoft Corporation. The lawsuit dragged on for years before finally being thrown out of court. A series of major product flops and missed deadlines destroyed Apple's reputation of invincibility, and consequently their market share dropped, particularly after the release of Windows 95

During this time, Apple branched out into consumer electronics. One example of this product diversification was the Apple QuickTake digital camera, one of the first digital cameras brought to the consumer market. A more famous example was the Newton, termed a "Personal digital assistant" or "PDA" by Sculley, that was introduced in 1993. Though it failed commercially, it defined and launched a new category of computing and was a forerunner of devices such as Palm Pilot, PocketPC, and eventually the iPhone.

1994 to 1997: Attempts at reinvention

The Apple Newton was Apple's first foray into the PDA markets, as well as one of the first in the industry. A financial flop, it helped pave the way for the Palm Pilot and Apple's own iPhone in the future.

By the mid-90s, Apple realized that it had to reinvent the Macintosh in order to stay competitive in the market. The needs of both computer users and computer programs were becoming, for a variety of technical reasons, harder for the existing hardware and operating system to address.

In 1994 Apple allied with long-time competitor IBM and CPU maker Motorola in the so-called AIM alliance. This was a bid to create a new computing platform (the PowerPC Reference Platform or PReP), which would use IBM and Motorola hardware coupled with Apple's software. The AIM alliance hoped that PReP's performance and Apple's software would leave the PC far behind, thus countering Microsoft, which had become Apple's chief competitor. That year, Apple introduced the Power Macintosh using IBM's PowerPC processor. This processor utilized a RISC architecture, which differed substantially from the Motorola 68k series that had been used by all previous Macs.

Throughout the mid to late 1990s, Apple tried to improve its operating system's multitasking and memory management. After multiple failed attempts to improve the existing Mac OS, first with the Taligent project, then later with Copland and Gershwin, the company chose to purchase NeXT and its NeXTSTEP operating system, bringing Steve Jobs back to Apple in the process. On July 9, 1997, Gil Amelio was ousted as CEO of Apple by the board of directors after overseeing a 3-year record-low stock price and crippling financial losses. Jobs stepped in as the interim CEO and began a restructuring of the company's product line.

At the 1997 Macworld Expo, Steve Jobs announced that Apple would be entering into a partnership with Microsoft to release new versions of Microsoft Office for the Macintosh as well as a US$150 million investment in non-voting Apple stock.

On November 10, 1997, Apple introduced the Apple Store, an online retail store based upon the WebObjects application server the company had acquired in its purchase of NeXT. The new direct sales outlet was also tied to a new build-to-order manufacturing strategy and announced at the same time as new machines using the PowerPC processor.

1998 to 2005: New beginnings

Company headquarters on Infinite Loop in Cupertino, California.

On August 15, 1998, Apple introduced a new all-in-one Mac computer reminiscent of the original Macintosh 128K: the iMac. The iMac design team was led by Jonathan Ive, who would later design the iPod and the iPhone. While not groundbreaking from a technological standpoint, the iMac featured an innovative new translucent plastic exterior, originally in Bondi Blue, but later many other colors. The iMac sold close to 800,000 units in its first five months and helped return the company to sustained profitability for the first time since 1993.

Through this time period, Apple purchased several companies in a move to create a portfolio of professional and consumer-oriented digital production software. In 1998, Apple announced the purchase of Macromedia's Final Cut software, signalling its expansion into the digital video editing market. The following year, Apple released two video editing products: iMovie for consumers, and Final Cut Pro for professionals, the latter of which has gone on to be a significant video-editing program, with 800,000 registered users in early 2007. In 2002 Apple purchased Nothing Real for their advanced digital compositing application Shake, as well as Emagic for their music productivity application Logic. which led to the development of their consumer-level GarageBand application. With iPhoto's release in 2002, this completed Apple's collection of consumer and professional level creativity software, with the consumer-level applications being collected together into the iLife suite.

Mac OS X, the operating system based on NeXT's OPENSTEP and BSD Unix was released on March 24, 2001 after several years of development. Aimed at consumers and professionals alike, Mac OS X aimed to marry the stability, reliability and security of the Unix operating system with the ease of use afforded by a completely overhauled user interface. To aid users in moving their applications from Mac OS 9, the new operating system allowed the use of OS 9 applications through Mac OS X's Classic environment.

The entrance of the Apple Store on Fifth Avenue in New York City is a glass cube, housing a cylindrical elevator and a spiral staircase that leads into the subterranean store.

On May 19, 2001, Apple opened its first official Apple Retail Stores in Virginia and California, and has since continued to open more stores in the United States and other countries.

Later the same year, Apple introduced its first iPod portable digital audio player. The product has proven phenomenally successful; over 100 million units have been sold in the six years since its introduction. In 2003, Apple's iTunes Store was introduced, offering online music downloads for US 99¢ a song and integration with the iPod. The service quickly became the market leader in online music services, with over 3 billion downloads by August 2007. Steve Jobs announced that iTunes had reached 4 billion downloads during his keynote address at the 2008 Macworld Conference & Expo.

As for the Macintosh, Apple's design team progressively abandoned the flashy colors of the iMac G3 era in favor of white polycarbonate for consumer lines such as the iMac and iBook, as well as the educational eMac, and metal enclosures for the professional lines. This began with the 2001 release of the titanium PowerBook and was followed by the 2001 white iBook, the 2002 flat-panel iMac, the 2003 Power Mac G5, and the 2004 Apple Cinema Displays.