posted by Thomas Hormby on Mon 2nd Oct 2006 19:11 UTC
IconOver its thirty year history, Apple has survived and even thrived despite boneheaded business decisions. From pricing the Macintosh out of most consumers' reach to creating some really ugly computers, Apple has made a lot of bad decisions.

Overpricing the Original Macintosh

John Sculley had demonstrated an affinity for public relations while he was at Pepsi. He took the 'Pepsi Challenge' campaign national, and championed the 'Pepsi Generation' campaign that still defines Pepsi's brand today. Unfortunately, he had a lot to learn about computers. His two major contributions to the Macintosh project during the first two years of his tenure as Apple CEO were to covertly fund the Macworld magazine and to inflate the price from $1,495 to $2,495. Macworld went on to become a respected publication, but the price hike did little other than to temporarily inflate Apple's financials.

Steve Jobs had tripled the price of the Macintosh in the years following his takeover from Jef Raskin. Sculley's price hike merely made the Macintosh less palatable to consumers. Jobs had forecasted that he would be able to sell 2 million by the end of 1985, but only 250,000 Macintoshes were sold. Sculley later defended the price hikes because of the incredibly expensive advertising campaigns for the Macintosh, but the damage had already been done.

Macintosh Office

1984 and the advertising inserts in Newsweek and TIME were clearly targeted to consumers and small businesses. If Apple wanted to challenge the IBM hegemony (which it felt it needed to in order to survive), it would have to establish the Macintosh as a universal standard, in enterprise and the home alike. The Macintosh Office was Apple's failed attempt to make the Macintosh a serious contender in enterprise.

The Macintosh Office centered around two products that never materialized the FileServer and BigMac. FileServer was to be the original network appliance. It would be the size of the external hard drives Apple was already selling to business users, and would plug directly into a LocalTalk or PhoneNet network.

The BigMac was much more ambitious. It was to be the replacement for the original Macintosh and the hacked Macintosh XL. The hardware was comparable to the wave of '3M' (named for their megaflop processors, megapixel displays and megabytes of memory) workstations that IBM, Sun and Apollo all had in the pipeline. The software was a radical departure. It would port the Macintosh user interface to UNIX. Apple had gotten as far as ponying up the hundreds of thousands of dollars required for a UNIX license, but development bogged down. When Jobs left the Macintosh/Lisa division in the summer of 1985, his replacement, Jean-Louis Gassee cancelled the project.

FileServer was equally doomed. Supposedly, the hardware was largely completed, but the software development got bogged down. The FileServer was slated for release in late 1985, but never made it to the market. In 1989, AppleShare Server was released, but it required a dedicated Macintosh to run.

The most notable failure in the Macintosh Office was its inaugural ad. Apple and Chiat/Day scored a hit with 1984, and Sculley and Jobs reasoned that 1985 should be no different. Another expensive spot, titled Lemmings, was produced for the 1985 SuperBowl. The ad depicted a line of blindfolded men and women walking off a cliff. The last man in the line stops and takes off his blindfold just before he falls into the precipice. The ad stunned the audience in Stanford Stadium, but not for a good reason. The ad just didn't make sense. Were businesspeople that used PC's or Apple II's suicidal Lemmings'

The Macintosh Office could very well have won Apple a stronghold in the enterprise and small business market, but it only served to alienate it. The LaserWriter was the only successful product to be released under the brand, and it was largely developed by Canon and Adobe. Worse than the vaporware FileServer and BigMac, Lemmings actually offended many of the people who Apple hoped to sell Macintoshes to.

Table of contents
  1. "Business Decision, Page 1/3"
  2. "Business Decision, Page 2/3"
  3. "Business Decision, Page 3/3"
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