WEBVTT - The Origin of the iPhone: Part One 0:00:04.519 --> 0:00:12.720 Technology with tech Stuff from work dot com. Hey there, 0:00:12.720 --> 0:00:17.400 and welcome to tech Stuff. I am your host, Jonathan Strickland, 0:00:17.640 --> 0:00:22.520 senior writer for how stuff works dot com, the podcasting 0:00:22.680 --> 0:00:28.120 company extraordinaire. We're all grown up, y'all. I don't know 0:00:28.160 --> 0:00:30.600 if you saw the news, but yeah, how stuff Works 0:00:30.600 --> 0:00:33.960 has spun off. It is a podcasting company, and of 0:00:34.000 --> 0:00:36.640 course tech Stuff being one of the first of the 0:00:36.760 --> 0:00:39.720 podcasts to UH to launch way back in the day, 0:00:39.760 --> 0:00:42.519 one of the first three major podcasts out of How 0:00:42.560 --> 0:00:46.040 stuff Works. I thought today we could talk about something 0:00:46.040 --> 0:00:51.840 that's iconic in today's technology, the iPhone, And it's really 0:00:51.880 --> 0:00:54.440 a matter of timing. It's important to talk about the 0:00:54.440 --> 0:00:57.160 iPhone came out ten years ago as of the recording 0:00:57.200 --> 0:00:59.280 of this podcast. Anyway, if you're listening in the future, 0:00:59.600 --> 0:01:01.960 it was more than that. But at the time of 0:01:01.960 --> 0:01:04.800 the recording, we're talking about ten years since the iPhone 0:01:04.840 --> 0:01:07.720 came out, and we have the tenth anniversary iPhone coming 0:01:07.720 --> 0:01:11.320 out right around the corner. In fact, on September twelve, seventeen, 0:01:11.720 --> 0:01:14.319 Apple is going to unveil the tenth anniversary version of 0:01:14.360 --> 0:01:16.399 the iPhone, and by the time you listen to this, 0:01:17.360 --> 0:01:20.800 maybe that's already happened. I don't know when you've when 0:01:20.800 --> 0:01:24.840 you've subscribed, but this episode should publish before September, and 0:01:24.840 --> 0:01:26.840 I thought it would be a good idea to trace 0:01:26.920 --> 0:01:29.319 the history of the iPhone and talk about impact on 0:01:29.360 --> 0:01:32.920 technology and culture. So I was gonna do an episode 0:01:32.920 --> 0:01:37.840 that just kind of went through the evolution of the iPhone. However, 0:01:37.920 --> 0:01:41.920 something happened. I started researching, and when I really got 0:01:41.959 --> 0:01:45.600 into the origins of the iPhone, I realized that, holy cow, 0:01:46.360 --> 0:01:49.240 just that story, just the story of how the first 0:01:49.320 --> 0:01:54.560 iPhone came to be, is so incredible and so complicated 0:01:54.680 --> 0:01:58.040 it justified an entire episode. So I concentrated on that, 0:01:58.560 --> 0:02:02.160 and then I found out that, surprise, surprise, it was 0:02:02.240 --> 0:02:05.640 such a huge story that it's more than one episode. 0:02:05.680 --> 0:02:08.680 This is actually part one of a two part episode 0:02:08.720 --> 0:02:13.720 about the origins of the iPhone. So this story will continue. 0:02:13.760 --> 0:02:17.639 In the next episode of tech Stuff. We will conclude 0:02:17.960 --> 0:02:20.560 the story of the origin of the iPhone. I have 0:02:20.600 --> 0:02:23.639 a little bit to say about how the iPhone evolved 0:02:23.639 --> 0:02:26.920 in its impact on technology in general at the end 0:02:26.960 --> 0:02:32.960 of the next episode. But this story is bonkers, y'all. Now, 0:02:33.040 --> 0:02:35.320 before I get into it, I've got to give some 0:02:35.400 --> 0:02:38.720 credit out there, actually a lot of credit to a 0:02:38.720 --> 0:02:42.880 particular writer, Brian Merchant. Mr. Merchant is an editor over 0:02:42.919 --> 0:02:45.720 at Motherboard. That's one of the sites I love to visit. 0:02:45.800 --> 0:02:50.600 Motherboards a great site. And he's been published by gosh, 0:02:50.600 --> 0:02:54.440 just about everyone everywhere, and he has a book out 0:02:54.560 --> 0:02:59.000 now titled The One Device, The Secret History of the iPhone. 0:02:59.320 --> 0:03:01.480 And I used a lot of different sources when I 0:03:01.480 --> 0:03:04.519 was researching this episode, but I would say that that 0:03:04.600 --> 0:03:09.480 book was my primary source. It's incredible. It's got an 0:03:09.680 --> 0:03:14.800 enormous amount, an exhaustive amount, you might say, of information 0:03:14.880 --> 0:03:19.160 about the iPhone and its development, including things like details 0:03:19.160 --> 0:03:23.160 about the manufacturing process and the materials that go into 0:03:23.240 --> 0:03:25.400 the iPhone, so not just the story of how it 0:03:25.480 --> 0:03:29.000 was created, but the actual story of the stuff used 0:03:29.200 --> 0:03:32.079 to create it, the physical materials. I'm not going to 0:03:32.200 --> 0:03:35.080 dive into that part because it's outside the scope of 0:03:35.120 --> 0:03:37.480 what I wanted to talk about, But if you find 0:03:37.560 --> 0:03:41.080 this discussion at all interesting, I recommend you hunt down 0:03:41.080 --> 0:03:44.960 a copy of Brian Merchant's book again, that's uh, The 0:03:45.000 --> 0:03:49.000 One Device. Check that out because he goes into way 0:03:49.160 --> 0:03:51.360 more detail than I am going to go into. And 0:03:51.680 --> 0:03:54.960 I've got two episodes to talk about here. Now, the 0:03:55.000 --> 0:03:58.760 iPhone origin story is incredibly complex and there are a 0:03:58.800 --> 0:04:02.040 lot of different layers involved in it. It's a story 0:04:02.280 --> 0:04:06.120 of innovation, it's a story about advances in technology, but 0:04:06.160 --> 0:04:11.480 it's also a story about corporate politics and personality clashes 0:04:11.720 --> 0:04:14.760 and personal tragedy as it turns out. So this isn't 0:04:14.800 --> 0:04:18.360 a story about how some guy at Apple cobbled a 0:04:18.440 --> 0:04:22.160 phone together out of I don't know, shoe polish and dreams. 0:04:22.600 --> 0:04:26.960 The iPhone project involved dozens of people, sometimes working at 0:04:27.040 --> 0:04:31.560 cross purposes toward one another, So you had groups that 0:04:31.640 --> 0:04:35.479 were trying to compete with each other within Apple in 0:04:35.600 --> 0:04:40.080 order to produce this iPhone. And really it's it's very 0:04:40.160 --> 0:04:43.480 challenging to find a spot to begin, I mean, and 0:04:43.520 --> 0:04:47.080 that's because real history rarely has a clearly cut beginning 0:04:47.720 --> 0:04:50.880 or a middle. Really, the only thing that history has 0:04:50.880 --> 0:04:55.279 a clear cut defining feature is an end, because one 0:04:55.320 --> 0:04:58.279 day there will be an end to at least human history, 0:04:58.320 --> 0:05:00.479 I mean, the heat death of the universe pretty spells 0:05:00.520 --> 0:05:03.719 it out for us. But until that day, whenever it 0:05:03.839 --> 0:05:07.400 may be, it is hard to find a point where 0:05:07.400 --> 0:05:09.640 you can have a clear cut beginning it's we like 0:05:09.720 --> 0:05:12.320 our stories to have nice beginnings. That's just not the 0:05:12.320 --> 0:05:15.680 way real history works. So I thought it might be 0:05:15.800 --> 0:05:20.160 fun to go back and talk about an earlier mobile 0:05:20.160 --> 0:05:23.240 device Apple tried to launch in an effort to define 0:05:23.279 --> 0:05:26.160 a new era in computing, because I think it's a 0:05:26.200 --> 0:05:30.760 great way to compare and contrast the iPhone and I'm 0:05:30.800 --> 0:05:36.320 talking about the unfortunate Apple Newton. Now, the Apple Newton 0:05:36.440 --> 0:05:39.400 story is valuable because it illustrates how the iPhone project 0:05:39.480 --> 0:05:43.640 could have gone really wrong, and the story begins more 0:05:43.680 --> 0:05:46.600 than a decade before the iPhone project got the official 0:05:46.680 --> 0:05:50.600 nod from Steve Jobs. In fact, this story begins back 0:05:50.600 --> 0:05:54.280 when Steve Jobs wasn't even part of Apple. So if 0:05:54.279 --> 0:05:58.239 you've listened to my podcasts about Apple, you know that 0:05:58.279 --> 0:06:01.880 this is part of their story. A right that John Scully, 0:06:02.160 --> 0:06:06.480 who was brought into Apple to be their CEO, had 0:06:06.520 --> 0:06:11.640 progressively pushed Steve Jobs towards the outskirts of the company, 0:06:11.680 --> 0:06:14.960 both figuratively and literally, putting him in a remote part 0:06:15.160 --> 0:06:19.279 of the Apple campus and giving him fewer and fewer responsibilities. 0:06:20.160 --> 0:06:24.320 Jobs had alienated Scully, and he was notorious for his 0:06:24.360 --> 0:06:30.039 managerial style, which I think we could generously describe as difficult. 0:06:30.880 --> 0:06:34.839 So Jobs left Apple in nineteen five. Effectively he was 0:06:34.920 --> 0:06:37.920 forced out, and Scully turned his sites to finding a 0:06:37.960 --> 0:06:42.240 new product to transform the computing space. Now. Scully became 0:06:42.320 --> 0:06:46.200 enamored with this idea of a tablet like computing device 0:06:46.320 --> 0:06:50.080 that would rely upon artificial intelligence to help users navigate 0:06:50.200 --> 0:06:53.320 and complete tasks. And it was a really far out 0:06:53.440 --> 0:06:56.400 futuristic idea that would turn out to be a bit 0:06:56.520 --> 0:07:00.440 beyond the technological grasp of Apple or anyone else for 0:07:00.480 --> 0:07:05.200 that matter at that time, and it just couldn't take 0:07:05.279 --> 0:07:08.080 on a format that would be consumer ready, but it 0:07:08.160 --> 0:07:10.360 did set in motion the events that would lead to 0:07:10.400 --> 0:07:13.840 the Apple Newton. Scully's version of this device was called 0:07:13.880 --> 0:07:19.400 the Knowledge Navigator. Apple even created a concept video to 0:07:19.440 --> 0:07:22.040 show off what the Knowledge Navigator would one day be 0:07:22.160 --> 0:07:24.800 able to do, and you can find this on YouTube, 0:07:24.800 --> 0:07:27.600 and it's fascinating if you watch this. It is an 0:07:27.600 --> 0:07:31.960 amazing piece of of a video because it has a 0:07:32.040 --> 0:07:35.400 lot of prescience about where technology was going to be 0:07:35.440 --> 0:07:37.720 headed over the next couple of decades. It took a 0:07:37.720 --> 0:07:40.239 couple of decades to get there, but you can see 0:07:40.640 --> 0:07:45.360 ideas that are now becoming commonplace. In that concept video. 0:07:46.080 --> 0:07:50.200 The actual knowledge navigator in that video was like a magazine. 0:07:50.280 --> 0:07:53.320 It was actually a folded over computer. You could unfold 0:07:53.400 --> 0:07:55.200 it like you would a magazine as if you were 0:07:55.240 --> 0:07:58.720 opening it, and it had screens on both sides where 0:07:59.480 --> 0:08:02.559 images and show up. It could talk to you, so 0:08:02.800 --> 0:08:05.320 it had a voice capability, and it it had a 0:08:05.360 --> 0:08:09.360 touch screen and voice activation system, so you could either 0:08:09.520 --> 0:08:12.200 use touch commands or talk to it and make it 0:08:12.280 --> 0:08:16.800 do things like add in scheduling, UH conflicts or anything 0:08:16.840 --> 0:08:19.800 like that, or just schedule events on your calendar. You 0:08:19.880 --> 0:08:22.800 might hear a message and say, hey, put a note 0:08:22.800 --> 0:08:27.800 in my calendar surprise birthday party tomorrow. So it was 0:08:27.920 --> 0:08:31.960 really incredible because it incorporated features that later on we 0:08:32.040 --> 0:08:35.959 would see in actual real world devices like the iPad 0:08:36.600 --> 0:08:40.080 or things like Amazon's Echo or Google Home. But it 0:08:40.120 --> 0:08:43.000 was very much in that concept phase back in the 0:08:43.080 --> 0:08:45.520 nineteen eighties. There was no way to really make this 0:08:45.760 --> 0:08:47.640 at that point. It was just sort of a dream 0:08:47.720 --> 0:08:50.959 that Scully had. He just wanted to see something akin 0:08:51.080 --> 0:08:53.760 to that. And one person who was brought over to 0:08:53.840 --> 0:08:57.040 Apple around this time who saw the potential in creating 0:08:57.040 --> 0:09:00.800 a handheld computing device was Jean Luis Gassy and I 0:09:00.840 --> 0:09:03.560 also talked about Jean Luis guess Ay in those Apple 0:09:03.640 --> 0:09:06.320 episodes I referred to earlier. Guess A worked with a 0:09:06.400 --> 0:09:10.840 guy named Steve Sikaman who used to work for HP, 0:09:11.480 --> 0:09:16.720 and he really wanted to create special new technology, but 0:09:16.760 --> 0:09:18.800 no one over at HP was interested. So then he 0:09:18.800 --> 0:09:21.160 came over to Apple and for a while he was 0:09:21.160 --> 0:09:23.640 trying to work that over at Apple. Didn't get a 0:09:23.640 --> 0:09:25.680 lot of headway there either, and was about to leave 0:09:25.720 --> 0:09:30.560 the company when he and guess A got an amazing opportunity. 0:09:30.840 --> 0:09:35.000 Guess A got permission from Scully to work on a 0:09:35.160 --> 0:09:38.800 project without actually telling him what that project was. He 0:09:38.880 --> 0:09:41.520 essentially said, I have this idea. I think it could 0:09:41.559 --> 0:09:44.439 be incredible. I need your go ahead for me to 0:09:44.440 --> 0:09:47.440 to bring some people over into this project and work 0:09:47.480 --> 0:09:49.480 on it, and then I'll have something to show you 0:09:49.520 --> 0:09:52.200 in the future and maybe it's something we can move 0:09:52.240 --> 0:09:54.320 on as a product. And Scully said, all right, I 0:09:54.360 --> 0:09:57.760 trust you, go ahead. So guess And and Segament began 0:09:57.840 --> 0:10:01.840 to work on a project check that would eventually become 0:10:01.960 --> 0:10:04.800 the Apple Newton. The idea was that segment. He had 0:10:04.840 --> 0:10:09.640 a real interest in handwriting recognition technology, and so they 0:10:09.640 --> 0:10:12.720 were talking about making a handheld device that would have 0:10:12.760 --> 0:10:16.040 a stylists and a writing surface, and you could write 0:10:16.120 --> 0:10:19.120 on the device and it would translate it into digital text, 0:10:20.000 --> 0:10:24.480 among other things. And so they started work on this 0:10:24.600 --> 0:10:26.920 and it would evolve into the Apple Newton. And even 0:10:26.960 --> 0:10:31.200 back then, Segment said there were very early problems right 0:10:31.240 --> 0:10:34.080 out of the gate with the Apple Newton. Big one 0:10:34.120 --> 0:10:37.240 of those problems was that Guess didn't really set any 0:10:37.280 --> 0:10:40.760 restrictions on what should go into the device. He didn't 0:10:41.080 --> 0:10:44.440 have any hard and fast rules about that. So you 0:10:44.480 --> 0:10:47.400 get a bunch of engineers together and you tell them 0:10:47.440 --> 0:10:51.240 your general idea, you don't set restrictions on it. Everyone 0:10:51.240 --> 0:10:55.760 immediately starts to brainstorm different features and functions that quote 0:10:55.800 --> 0:10:59.200 unquote should go into that device. And then it just 0:10:59.320 --> 0:11:04.240 becomes a Morga's board of people adding in functionality, making 0:11:04.280 --> 0:11:07.680 the device more and more complex over time, and it 0:11:07.720 --> 0:11:11.120 became bloated with features as engineers kept thinking of other 0:11:11.160 --> 0:11:14.280 stuff the device should be able to do. The more 0:11:14.320 --> 0:11:17.719 features they gave the Newton, the more power it was 0:11:17.760 --> 0:11:21.440 going to require, and the more expensive components it would 0:11:21.440 --> 0:11:24.000 require in order to do this sort of processing, and 0:11:24.040 --> 0:11:27.439 the more strain on its battery it would create because 0:11:27.600 --> 0:11:30.800 you're requiring more power. So, in other words, it was 0:11:30.840 --> 0:11:34.280 just making the whole thing more complicated and more expensive, 0:11:34.600 --> 0:11:37.880 and it was strangling the development of the project. So 0:11:37.960 --> 0:11:41.400 in those early designs, before they had anything really to 0:11:41.480 --> 0:11:44.080 show for it, the team determined that the size of 0:11:44.080 --> 0:11:46.720 the Newton would be about the same as a four 0:11:46.880 --> 0:11:50.840 standard paper size. At Secondment felt it was already getting 0:11:51.080 --> 0:11:53.120 bigger than it was supposed to be. He wanted a 0:11:53.160 --> 0:11:56.680 smaller form factor, and the projected price for the gadget, 0:11:56.920 --> 0:12:00.920 based upon the elements that they were brainstorming at that time, 0:12:01.040 --> 0:12:04.600 was looked at it about six thousand dollars six thousand 0:12:04.640 --> 0:12:10.079 dollars for a handheld device, essentially a personal digital assistant 0:12:10.160 --> 0:12:13.160 or p d A that could read your handwriting. Six 0:12:13.400 --> 0:12:17.160 grand and we're talking nineteen eighties money here, so if 0:12:17.200 --> 0:12:20.720 you adjusted for inflation, you're talking about ten thousand dollars 0:12:20.720 --> 0:12:26.959 in today's cash for this device. Ten grand. I mean, 0:12:27.040 --> 0:12:31.240 Apple was known for selling premium products at a high price. 0:12:31.320 --> 0:12:35.760 But come on, well, Guessa and Sigaman would both end 0:12:35.840 --> 0:12:40.080 up leaving Apple before the Newton was finished. They would 0:12:40.080 --> 0:12:43.439 go on to found a new company called be Incorporated. 0:12:43.480 --> 0:12:47.680 That's b E. They created the b box platform. But 0:12:47.760 --> 0:12:51.080 a side note here segment would eventually rejoin our story 0:12:51.240 --> 0:12:53.520 because he would come back to Apple in two thousand 0:12:53.600 --> 0:12:57.480 three as vice president of Software Technology, so he would 0:12:57.480 --> 0:12:59.880 actually play an important role in the development of the 0:13:00.000 --> 0:13:04.559 iPhone later on, but his role in the Newton had 0:13:04.559 --> 0:13:06.560 come to an end. He and guess A left, So 0:13:06.600 --> 0:13:09.200 even though they got the project started, they left before 0:13:09.200 --> 0:13:11.800 it was finished. But by then Scully was completely behind 0:13:11.840 --> 0:13:15.600 it and the ball was rolling and there were there 0:13:15.640 --> 0:13:18.200 was a team hard at work trying to make this 0:13:18.360 --> 0:13:21.520 become a reality. Now on the software side of things, 0:13:21.840 --> 0:13:25.560 the Apple Newton pioneered some really cool technology, including elements 0:13:25.559 --> 0:13:28.880 of that assist of AI that Scully had been dreaming about. 0:13:29.280 --> 0:13:32.160 The software could search through text, and it could identify 0:13:32.360 --> 0:13:35.160 names and cross reference that with a context list. It 0:13:35.200 --> 0:13:38.760 could identify phone numbers, It could send hyperlinks for email 0:13:38.800 --> 0:13:42.679 addresses and more and make it more useful by recognizing 0:13:42.720 --> 0:13:45.440 these elements within text. And it could also pull up 0:13:45.480 --> 0:13:50.080 scheduling information based upon text within messages about meeting times. 0:13:50.280 --> 0:13:52.760 So short it had early versions of the features you 0:13:52.840 --> 0:13:54.840 find in a lot of email apps and smart devices 0:13:54.840 --> 0:13:57.959 out there. So, for example, if I get an email 0:13:58.400 --> 0:14:02.400 that uh confer arms that I've purchased tickets for something 0:14:02.400 --> 0:14:05.679 and it's going to my Gmail account, that will put 0:14:05.679 --> 0:14:09.480 in a Gmail entry in my out or my my 0:14:09.559 --> 0:14:12.640 Google calendar and say, all right, well, because I've got 0:14:12.640 --> 0:14:15.120 this message and because it had this time and this time, 0:14:15.800 --> 0:14:18.439 this date on it, I can put in an entry 0:14:18.520 --> 0:14:22.680 in that calendar. Well, the Apple Newton had a rudimentary 0:14:22.800 --> 0:14:26.080 form of that technology in it, which was years ahead 0:14:26.080 --> 0:14:29.480 of anyone else at that point. It also had the 0:14:29.560 --> 0:14:34.160 infamous handwriting recognition algorithm. Now, the algorithm was designed to 0:14:34.360 --> 0:14:38.120 learn over time how to recognize specific characters written onto 0:14:38.200 --> 0:14:41.720 the message pad, but it wasn't terribly accurate right out 0:14:41.720 --> 0:14:43.600 of the gate, and that would end up causing some 0:14:43.800 --> 0:14:48.560 major major problems for Apple. The development process was stretching 0:14:48.560 --> 0:14:51.240 on for years, and Scully eventually put his foot down 0:14:51.280 --> 0:14:53.760 and demanded that the team produced a Newton device that 0:14:53.800 --> 0:14:58.240 would be ready for consumers by April second, and he 0:14:58.280 --> 0:15:02.040 wanted it to cost less than of teen hundred dollars. Meanwhile, 0:15:03.640 --> 0:15:06.400 within the teams that were about three different models that 0:15:06.440 --> 0:15:09.560 were being proposed for the Apple Newton and They ranged 0:15:09.680 --> 0:15:13.560 from the bare bones version that would be the cheapest 0:15:13.720 --> 0:15:16.440 to a full featured version that would be more than 0:15:16.480 --> 0:15:20.360 seven thousand dollars. Teams broke out in support of those 0:15:20.360 --> 0:15:23.320 different models, and the two teams that had the most 0:15:23.400 --> 0:15:26.400 support were the extreme ends. You had the junior end 0:15:26.480 --> 0:15:31.200 on one side and the senior end on the other side. Uh, 0:15:31.200 --> 0:15:34.120 and it became a battle of wills, and apparently it 0:15:34.200 --> 0:15:37.080 got a bit heated. The senior version of the Newton 0:15:37.240 --> 0:15:41.080 was way more feature heavy and included some stuff like 0:15:41.120 --> 0:15:44.440 the ability to network with other Newton's. The problem was 0:15:44.480 --> 0:15:47.680 the way it networked was through infrared communication, and the 0:15:47.720 --> 0:15:51.120 infrared sensors did not work well under fluorescent lights, which 0:15:51.200 --> 0:15:55.240 led the junior team to jokingly state that the only 0:15:55.280 --> 0:15:58.600 way you could use the Newton networking function in the 0:15:58.680 --> 0:16:01.160 senior model would be if you turned all the lights 0:16:01.160 --> 0:16:04.960 off inside your office, which seems a bit counterproductive. So 0:16:05.080 --> 0:16:07.000 is this kind of sniping that was going on back 0:16:07.080 --> 0:16:09.360 and forth. The junior version, like I said, was not 0:16:09.440 --> 0:16:11.880 quite so latent with features and would cost less than 0:16:11.920 --> 0:16:14.920 a thousand dollars, and eventually it became the front runner 0:16:14.960 --> 0:16:18.160 among all the models, but it didn't get there without 0:16:18.160 --> 0:16:23.200 a lot of arguments on all sides. April came and 0:16:23.200 --> 0:16:25.920 went and the team still didn't have a Shippa Bowl 0:16:25.960 --> 0:16:29.080 product yet, though they had performed a few successful demos, 0:16:29.080 --> 0:16:32.760 so Scully was assuaged a little bit, although he kept 0:16:32.840 --> 0:16:35.240 on setting new deadlines so that the team would have 0:16:35.400 --> 0:16:37.880 something to work toward. He laid down the law again 0:16:37.920 --> 0:16:40.520 and kept creating these deadlines, saying pressure the team, he said, 0:16:40.560 --> 0:16:42.520 produced some results for me, and it caused a great 0:16:42.520 --> 0:16:45.840 deal of problems among the team and likely contributed to 0:16:45.920 --> 0:16:51.160 one absolute tragedy. One of the programmers on the project 0:16:51.320 --> 0:16:54.840 was a guy named Ko who moved from Japan with 0:16:54.880 --> 0:16:57.080 his wife to be part of the programming community in 0:16:57.120 --> 0:17:02.840 Silicon Valley and joined Apple. On December twelfth, Iszono went 0:17:02.880 --> 0:17:07.320 home after work and he committed suicide. The assumption is 0:17:07.359 --> 0:17:11.520 that the intense pressure at work to create the Apple 0:17:11.600 --> 0:17:15.800 Newton led to this breakdown. Now, that was the absolute 0:17:15.800 --> 0:17:18.760 worst of the tragedies associated with Newton's development, but it 0:17:18.800 --> 0:17:21.800 was not the only one. There was another event that 0:17:21.840 --> 0:17:25.320 happened where one of the developers had some sort of 0:17:25.400 --> 0:17:29.560 mental breakdown and assaulted his roommate and was charged with 0:17:29.600 --> 0:17:32.800 assault and sent to jail as a result, so John 0:17:32.840 --> 0:17:35.800 Scully would not be in charge by the time the 0:17:35.840 --> 0:17:39.280 Newton was finally ready to debut. He stepped down as 0:17:39.359 --> 0:17:44.560 CEO of Apple on June seven. That was two months 0:17:44.840 --> 0:17:48.040 before the Newton went gold, so it's just too much 0:17:48.040 --> 0:17:51.800 shy of the Newton actually launching. He was effectively forced 0:17:51.840 --> 0:17:54.480 to resign by the board of directors, and he became 0:17:54.560 --> 0:17:57.480 the chairman of Apple, but his position was reduced to 0:17:57.520 --> 0:18:01.359 being largely ceremonial, which was an that was somewhat ironic 0:18:01.480 --> 0:18:04.399 because Scully had effectively done the same thing to Steve 0:18:04.520 --> 0:18:07.040 Jobs a decade earlier when he was forced out of 0:18:07.080 --> 0:18:10.680 the company. Michael Spindler would step in as the new 0:18:10.760 --> 0:18:13.280 CEO of Apple and he would oversee the launch of 0:18:13.320 --> 0:18:15.920 the Newton. The team did finish the Newton, and it 0:18:16.040 --> 0:18:21.840 shipped in August, I should say, but the handwriting recognition 0:18:22.000 --> 0:18:25.120 was faulty, as you probably know if you've ever heard 0:18:25.160 --> 0:18:28.960 anything about the Newton, and since the handwriting feature was 0:18:29.040 --> 0:18:32.119 supposed to be the core feature of the Newton, it 0:18:32.200 --> 0:18:37.359 led to massive criticism and ridicule. Steve Jobs was fuming 0:18:37.520 --> 0:18:39.320 over it. He was not part of Apple, but he 0:18:39.359 --> 0:18:44.080 was furious to see a product make Apple the laughing 0:18:44.160 --> 0:18:47.199 stock of the tech community. He hated seeing this company 0:18:47.240 --> 0:18:49.320 that he had co found and held up to ridicule, 0:18:49.600 --> 0:18:52.600 and he had made no secret of his disdain towards 0:18:52.640 --> 0:18:57.400 Scully throughout Scully's tenure as CEO. Of course, a couple 0:18:57.359 --> 0:19:00.960 of years later, Steve Jobs would rejoin Apple, and what 0:19:01.119 --> 0:19:05.800 happened was that Apple acquired Jobs as company Next. So 0:19:05.920 --> 0:19:09.639 Jobs that created a company called Next Computers, and Jobs 0:19:09.640 --> 0:19:13.760 had failed to produce a commercially successful computer with his 0:19:13.920 --> 0:19:18.400 next company, but uh, and it was because that computer 0:19:18.560 --> 0:19:20.720 was incredibly expensive and a lot of people thought it 0:19:20.760 --> 0:19:23.000 was limited in what it could do. But mostly it 0:19:23.040 --> 0:19:25.480 was the cost of the computer that made people bulk. 0:19:26.440 --> 0:19:29.720 But the operating system innovations that his company had created 0:19:30.040 --> 0:19:33.280 were undeniable, and Apple was really in need of that innovation. 0:19:33.440 --> 0:19:37.520 So Apple acquired Next, and Jobs came along with the company, 0:19:37.840 --> 0:19:40.919 and before long he was able to maneuver the board 0:19:41.080 --> 0:19:44.320 into making him the interim CEO, and eventually he became 0:19:44.359 --> 0:19:48.760 the permanent CEO of Apple. So that's the Newton's story, 0:19:49.359 --> 0:19:52.600 and I'll talk more about how that impacts the iPhone 0:19:52.640 --> 0:19:55.320 story in just a moment. But first let's take a 0:19:55.400 --> 0:20:05.119 quick break to thank our sponsor. You know, the reason 0:20:05.160 --> 0:20:07.439 I spent so much time on that story of the 0:20:07.440 --> 0:20:11.040 Newton in a podcast about the iPhone is to set 0:20:11.080 --> 0:20:13.280 that stage and explain why the iPhone was such a 0:20:13.280 --> 0:20:18.200 big risk for Apple. The company's reputation had already been damaged. 0:20:18.359 --> 0:20:22.119 The Newton was literally a punchline. I distinctly remember a 0:20:22.160 --> 0:20:24.920 Simpsons episode that used it as a throwaway joke. And 0:20:25.000 --> 0:20:28.680 again I mean that literally, as Nelson throws a Newton 0:20:28.760 --> 0:20:33.919 away after it misinterprets handwriting. So trying to get a 0:20:33.960 --> 0:20:36.600 new type of computing device out the door was going 0:20:36.680 --> 0:20:40.600 to have big obstacles, not just from technology but also 0:20:40.720 --> 0:20:44.640 from a corporate culture standpoint. And Steve Jobs was, as 0:20:44.680 --> 0:20:49.080 I'm sure many of you are aware, a notoriously difficult 0:20:49.119 --> 0:20:52.920 person to work for. He had very strong convictions, very 0:20:52.920 --> 0:20:56.320 strong opinions, and he was not terribly concerned with how 0:20:56.359 --> 0:21:00.960 they came across in his interactions with other people. Uh 0:21:01.000 --> 0:21:06.040 he would he could be incredibly blunt and sometimes extremely critical, 0:21:06.720 --> 0:21:09.879 and it was a tough environment. Now, in the early 0:21:09.920 --> 0:21:14.360 two thousand's, before anyone had even proposed a formal phone project, 0:21:14.440 --> 0:21:18.720 at Apple, employees were talking about how cell phones were 0:21:18.720 --> 0:21:21.879 a potential opportunity for the company because there was a 0:21:21.880 --> 0:21:27.040 general consensus that cell phones kind of stunk at the time. 0:21:27.520 --> 0:21:30.840 They had really bad call quality, many of the handsets 0:21:30.840 --> 0:21:33.440 were not good at holding onto a signal, you would 0:21:33.440 --> 0:21:37.120 have calls dropping left and right, and the internet features 0:21:37.160 --> 0:21:40.520 were anemic. But while there was a general desire to 0:21:40.560 --> 0:21:44.080 look into developing a cell phone under Apple's brand, it 0:21:44.160 --> 0:21:48.399 remained mostly wishful thinking, including among people who had worked 0:21:48.440 --> 0:21:52.160 on the Newton project and who were still at Apple. Meanwhile, 0:21:52.520 --> 0:21:56.560 Apple was launching a device that would revolutionize electronics as 0:21:56.600 --> 0:22:00.920 well as an entirely different industry, namely the music industry. 0:22:00.960 --> 0:22:04.440 I am talking, of course, about the iPod, and I've 0:22:04.480 --> 0:22:06.600 done a full episode about that device, so I'm not 0:22:06.560 --> 0:22:10.159 going to retread it here, But the iPod it wasn't 0:22:10.160 --> 0:22:13.040 a home run right away. The two thousand one iPod 0:22:13.200 --> 0:22:17.159 had some hefty limitations. Now. The biggest limitation was that 0:22:17.200 --> 0:22:20.800 it was only compatible with Mac computers, and that was 0:22:20.840 --> 0:22:24.359 a problem because at the time, Max represented a very 0:22:24.400 --> 0:22:29.200 small percentage of the overall computer market. The overwhelming majority 0:22:29.240 --> 0:22:32.800 of computer owners were using Windows based devices, and so 0:22:32.880 --> 0:22:37.080 the iPods customer base was limited by that compatibility issue. 0:22:37.640 --> 0:22:41.119 Now Tony Fidell, who sometimes is referred to as the 0:22:41.240 --> 0:22:45.400 pod Father, oversaw the development and launch of the iPod, 0:22:45.760 --> 0:22:49.080 and he thought that Apple should make the iPod work 0:22:49.160 --> 0:22:52.560 with PCs, which would mean developing iTunes software that could 0:22:52.640 --> 0:22:58.399 run on Windows based machines. Steve Jobs was really reluctant. Actually, 0:22:58.440 --> 0:23:02.080 that's too gentle word to use. Steve Jobs refused to 0:23:02.160 --> 0:23:04.800 do this for a long time, but after a couple 0:23:04.800 --> 0:23:08.240 of years of lackluster iPod sales, Jobs had to admit 0:23:08.280 --> 0:23:10.600 that they needed to explore other options if the iPod 0:23:10.720 --> 0:23:14.160 were to be a real success. Now, Luckily, in this case, 0:23:14.400 --> 0:23:17.919 Fidel had kind of gone behind Steve Jobs back and 0:23:17.920 --> 0:23:19.720 he had been working with a group of people to 0:23:19.840 --> 0:23:24.720 develop iTunes for Windows machines without Jobs being aware of it. 0:23:25.280 --> 0:23:28.200 So once Steve Jobs actually came around to this idea 0:23:28.359 --> 0:23:31.960 of a Windows compatible iPod, Fidel already had the iTunes 0:23:32.200 --> 0:23:35.919 build ready to go essentially, and once Apple allowed for 0:23:35.960 --> 0:23:42.200 this connectivity, iPod sales exploded. It suddenly became extremely popular 0:23:42.240 --> 0:23:46.320 because now it was compatible with the overwhelming majority of 0:23:46.400 --> 0:23:49.520 computers out there, and by two thousand four, the iPod 0:23:49.640 --> 0:23:54.240 sales accounted for fifty percent of all revenue for Apple. 0:23:54.880 --> 0:23:58.479 So Apple was no longer just a computer company. Had 0:23:58.520 --> 0:24:01.080 a new mobile product that was in just as much 0:24:01.119 --> 0:24:04.400 money as their computer sales were bringing in. So this 0:24:04.480 --> 0:24:07.680 was revolutionary, and that revolution would of course ripple out 0:24:07.680 --> 0:24:10.479 to affect the entire music industry as well. It really 0:24:10.600 --> 0:24:14.440