The Untold History of Apple

By Jake Schroeder
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Photo Courtesy: Ted Thai/Getty Images

Apple Inc. as we know it was started in a small garage in California in the 1970s. Its co-founders would set out to not only bring personal computers to homes across the globe but also to change the world for the better.

What most people don’t know is that Apple’s road to success hasn’t always been smooth. The company experienced trials, tribulations, scandal, and setbacks as it grew. This is the story of how Apple came to be the company it is today.

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Jobs And Wozniak Meet

Bill Fernandez first brought together the historic duo of Steve Jobs and Steve Wozniak in 1971. At the time, Wozniak was 21 and Jobs was 16. Wozniak was a self-taught electronics engineer who started creating blue boxes that allowed people to make phone calls free of charge.

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When Steve Jobs and Steve Wozniak first started working together, Jobs would sell those boxes for $150 each. The pair would then split the profits. Jobs sold 200 of these blue boxes. By 1975, both Steves had withdrawn from college at Reed College and UC Berkeley. By 1976, Wozniak had created what would be known as the Apple I, and Jobs saw its commercial potential.

Company Formation

In 1976, Jobs, Wozniak, and Ronald Wayne started Apple Computer Inc. Ronald Wayne was formerly a chief craftsman at Atari. Soon after the company formed, Wayne dropped out of the company, selling his 10% stake back to the two Steves for the bargain price of $800.

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Jobs quickly secured the company’s first order for their personal computer known as Apple I. With money from an angel investor and financing from Bank of America, Apple Computer Inc. was formed on January 3, 1977.

Apple I

The first computer they built was the Apple I. The Apple I had a few notable features. First, it had a TV display. Second, it could display 60 characters per second. Third, it had a very fast (for the time) load time.

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This fairly simple machine was already considered an unprecedented design. With Wayne and Wozniak building the Apple I machines, Jobs was able to secure parts, financing, and building space, all without giving away any stock in the company.

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Apple II

After their first sale of 200 machines, Wozniak was able to greatly improve the design and function of the Apple II. In 1977, the Apple II was introduced at a computer fair and it caught the interest of Toshio Mizushima. Mizushima would be the first Japanese Apple dealer.

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The Apple II had an improved display, memory, keyboard, and case. Jobs would advertise that it was ready to run right out of the box. The Apple II was one of the three home computers that contributed to the creation of the personal computer market. The Commodore PET and the TRS-80 were the other two.

Apple III

In 1980, Apple III was introduced. Although it was a conservative design, Jobs pushed for this model to not have a cooling fan. A cooling fan on a computer was crucial at the time to prevent it from overheating or even catching fire. The Apple III would eventually be recalled as thousands of people complained about it overheating.

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In 1983, a modified version of the Apple III was introduced hoping to rectify the problems of the previous model, but the company took a hit from the mistakes of Apple III. The small company continued to move forward, advertising and looking towards an IPO.

Apple IPO

Apple Computer was quickly becoming a name to watch. What started as a small workshop business in a home in California became the second-largest small computer company of its time. Apple hoped to focus its efforts on business, education, and personal computer markets all over the globe.

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In December 1980, Apple opened up its stock to the investing public by introducing their Initial Public Offering. When Apple went public, it generated the most money of any IPO to date. They made the biggest splash since the Ford Motor Company in 1956. Jobs hosted his first emotionally charged shareholder's meeting post-IPO.

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The PC

By 1981, Apple had become one of the three largest computer manufacturers, even surpassing Radio Shack as the leader. At this point, the only thing slowing Apple’s growth was its capacity to keep up with demand. When IBM's computer hit the market, a divide could now be seen between Apple loyalists and essentially everyone else.

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Apple loyalists would only purchase Apple products despite their occasional major flaws. Those people viewed Apple as a small company who were making computers for regular people on regular budgets. By 1983, IBM surpassed Apple in computer sales as the pair focused on marketing and R&D over improving their Apple II model.

Lisa

The Lisa group was hard at work designing a new computer that would introduce the world to terms like desktop, icon and mouse. In order to create the Lisa model, Xerox granted Apple three days of access to their facilities in exchange for $1 million pre-IPO stock. This was unprecedented for the two companies.

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After months of testing, Lisa was introduced in 1983 and included a floppy disc and an interface with icons and windows. Lisa was an expensive model. With a cost equivalent to $25,000 at the time, Lisa failed to make it in the business sector.

The Commercial

By 1984, it became clear that Apple was the only real competitor to IBM's influence. The marketing of this machine included a single television commercial that cost $1.5 million. The 1984 commercial consisted of a heroine in a white tank top with a picture of the Macintosh computer on it who would save humanity from "Big Brother".

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When the Macintosh first went on sale it showed off their two interfaces: MacWrite and MacPaint. In 1985, Microsoft Word, Lotus Jazz, and Microsoft Office were introduced. Through Apple’s success with Adobe Systems, Apple became known as the default for industries such as advertising, cinema, publishing, the arts, and music.

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Jobs And Wozniak Leave Apple

Wozniak eventually left Apple, stating that the company was going in a different direction than he would have liked. He continues to represent Apple at events and interviews and he receives an annual stipend of $120,000 per year. In 1985, Jobs was removed as the general manager of the Macintosh division.

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Jobs resigned from Apple in September 1985. John Sculley reorganized the company, unifying the divisions. In protest over being removed Jobs sold all but one of the 6.5 million shares he owned in Apple. He would then go on to acquire Pixar for $5 million. What would soon become the Mac OS X was what Tim Berners-Lee initially used to develop the World Wide Web.

Apple’s Corporate Performance

Over the next couple of years, Apple would undertake five acquisitions, including Network Innovations, Styleware, Coral Software and Nashoba Systems. This was a busy time for Apple in terms of sales and acquisitions. Apple also released a compact version of the Apple II. This version would be known as the Apple IIc.

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Despite the release of new computers with new interfaces and a mouse-driven environment, Apple II computers would remain the main source of revenue for the company for several years. Apple II was still the biggest seller and the most popular product. The Mac model was becoming a product of its own by the late 1980s.

Macintosh Models

1989-1991 was considered to be the golden age of the Mac. The Mac family would include releases such as the Mac SE, the Mac II, the Mac Classic, and the Mac LC. Portable Macs were also released in 1989 including the not-so-popular Macintosh Portable.

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In 1991, the PowerBook was released and this historic product would lay the foundation for the ergonomic laptop that Apple is still known for. These products became increasingly popular and revenue increased for Apple. In 1987, apple.com was purchased as one of the first domains registered on the internet. This is still the company's domain today.

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The Early 1990s

In the 1980s, Amiga and Atari ST platforms were among Apple’s foremost technology rivals. IBM PC computers were still more popular than any of these three, however. The early ‘90s were some of the most poorly managed years in Apple’s history. Production and profits took a hit in the early 1990s.

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Apple underestimated the popularity of certain models and overproduced others, causing a supply and demand problem in the market. Apple partnered with IBM and Motorola in 1991 to form the AIM Alliance.

Mid-1990s

In the mid-1990s, Apple began to release personal digital assistant devices also known as PDAs. These would inspire the Palm Pilot and Pocket PCs that would emerge later in the ‘90s. In 1994, Apple launched an online service that would provide email and news called eWorld.

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In 1985 the official decision was made to license the Mac PS and Macintosh ROMs to manufacturers who would produce Mac clones to produce more revenue for the company. Jobs would later find a loophole in these contracts that would end the clone era.

The Late 1990s

With the end of the Macintosh cloning era, market shares dropped quickly from 10% to 3%. Steve Job’s company, NeXT, was eventually bought out by BeOS to sell its operating system to Apple. In 1996, Apple acquired NeXT and the operating system. NeXT became a part of Apple to help with their operating system efforts.

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The purchase brought Steve Jobs back to Apple in the late 1990s. He would once again return to management at Apple and the NeXT technology would eventually become the Mac OS X operating system’s foundation.

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Steve Jobs Returns

In 1997, Gil Amelia was removed as the chief operating officer of Apple. Apple appointed Jobs as the interim CEO and he began a massive restructuring of the company and its product line. Jobs eventually became the chief operating officer and he would remain in that position from 1997 until August of 2011.

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By 1997, Apple had introduced the Apple Store, which sold applications. The online retail store was based on NeXTs WebObjects. This direct sales platform was tied to the new manufacturing strategy that focused on build-to-order.

Microsoft And Apple

In 1997, Steve Jobs made the announcement that Apple would partner with Microsoft. The five-year commitment meant that Microsoft Office would be available on Macintosh computers as well. This $150 million investment in Apple showed a new partnership between Steve Jobs and Microsoft's Bill Gates.

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Internet Explorer became the default internet browser on the Macintosh and Apple. Gates announced his plans for the software they would be developing for Macs. Jobs gave a heartfelt speech about how the two companies could benefit from each other’s success and a new partnership. Jobs made the announcement at the MacWorld Expo in 1997.

The iMac And iBook

One of the first things Jobs did as the chief executive officer was to develop the iMac. With time to restructure, Apple was able to create an iMac with a CPU and CRT display in a new and improved, streamlined, translucent plastic body. This line was a major success. Apple sold around 1 million iMacs each year.

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The iMac and newly unveiled iBook introduced Apple’s new aesthetic to the public. The iBook was Apple’s first laptop geared towards consumers. This laptop was also one of the first to support Wireless LAN, helping make the technology popular.

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Mac Operating System

Apple introduced its Mac OS X operating system in 2001. The operating system was based on NeXT’s operating systems and incorporated FreeBSD parts. This operating system was aimed at professionals as well as home consumers.

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Apple allowed consumers to transition between operating systems using both environments. This was key to their initial success. The new interface was user-friendly and completely overhauled. Developers could use Apple’s Carbon API to make their Mac OS 9 system adaptable to the OS X’s new features.

Retail Stores Open For Business

After much speculation and anticipation, in May 2001 Apple made the announcement that they would be opening their own line of brick-and-mortar Apple stores. The new Apple retail stores would be located in major computer markets throughout the United States and eventually the world.

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One of the main goals of the new Apple retail stores was to reverse the decline in Apple’s computer sales. In the years leading up to this, Apple was losing its share of the market. The other thing Apple was trying to accomplish by owning their own stores was to improve marketing that was taking place at third-party retail stores.

The iPod Is Born

Apple introduced the iPod in October 2001. The iPod was Apple's first portable, hand-held digital audio player. The first version was able to store 5 GB music player that could store around 1,000 songs. The iPod gave a big boost to Apple’s revenue.

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The iPod eventually gave way to a line of music play products including the iPod Touch, the iPod Shuffle, the iPod Classic, and the Nano. Eventually, many of these would be discontinued as the iPhone and iPad came into production. At the time, Jobs stated that Apple had about 76% of the portable music player market.

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The New iMac

In 2002, Apple moved over to a reimagined and completely new iMac design. This iMac had a G4 processor and an LCD display. The new iMac 4G was white with a hemispherical base. There was also a flat panel all-digital display. The iMac was supported by a chrome neck that could swivel.

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In 2004, Apple began to work with new suppliers for parts. They were able to produce the iMac G5, which was one of the thinnest computers on the market. They also released the iPod Video, iPod Touch, iPod Classic, and eventually the iPhone.

Brick-And-Mortar Takeover

In late 2003, Apple opened its first Apple retail store abroad. The first store was located in Tokyo in the Ginza district. In the following years, Apple opened stores in Nagoya, Tokyo, Fukuoka, Sendai, Sapporo, and London on Regent Street.

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By 2010 there were stores in Toronto, Dartford, Manchester, Brent Cross, and Covent Garden, which is currently the largest Apple store. In 2004, Apple also opened several mini-stores that would help reach consumers in areas that might not support a full retail store. Palo Alto, California was home to one of the first mini-stores.

Apple Web Services

Apple introduced its first iTools service in 2000. These free web-based tools included an email account, an iReview consumer review site, iCards for digital greeting cards, and KidSafe which aimed to keep children on safe browsing sites.

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Eventually, Apple Mac became MobileMe, before transitioning to iCloud, the current web service used by Apple. These services provided email accounts, find my Mac, iTunes and cloud services. iCloud now also includes data back up and storage and synchronization across all iCloud iOS devices.

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iTunes

In 2003, Apple launched the iTunes Music Store. iTunes boasted 2 million downloads in its first 16 days. By October, iTunes supported music purchased through Apple as well as Windows. This was the only music store that was available in the United States at the time due to licensing restrictions.

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In 2004, Apple launched the iTunes Music Store in Germany, the United Kingdom, and France. iTunes opened in Ireland, Canada, Denmark, Norway, Switzerland and Sweden shortly after. In 2005, the 500 millionth song was purchased on the iTunes Music Store.

Intel

Steve Jobs announced that Apple would begin producing Apple computers that were Intel-based Macintosh models in June 2005. The company had been working on versions that were cross-platform compatible.

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Over the next five years, the transition to the Intel processor system would continue until late 2007. The first Intel-based computers, the iMac and the MacBook Pro were introduced in 2006. Both of these machines were built off of the Intel Core Duo platform.

Apple Inc.

The company eventually shortened its name to Apple Inc. in 2007. Steve Jobs addressed the change during his keynote address at the MacWorld Expo. Jobs explained that the name change reflected the broadening of their brand beyond just computers.

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This keynote address also included the announcement of the first iPhone. The iPhone would revolutionize the industry in a way that none of its products had done before. Apple also unveiled its first internet communicator that worked with Safari.

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iPhone

The iPhone became available to the public on June 29, 2007. By 2008, iPhone 4 was released. In 2011, a Verizon model was released, followed by a Sprint iPhone model in 2011. This was released shortly after Steve Jobs passed away.

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The iPhone 4 was available for both AT&T and Verizon Wireless in 2011. By 2009, The United States, Canada, and most major European countries had access to iPhone models. Around the same time, the Apple iPad became available along with the second-generation Apple TV.

iPad

Apple announced the release of its iPad on January 27, 2010. By April 2010, the iPad was released commercially. The iPad went into the iOS line of products. The iPad had the same applications as the iPhone but the screen was twice the size.

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There was fear at first that the iPad would infringe upon sales of the iPhone in 2010. In 2011, it was discovered that the iPad actually increased the sales of the iMac and MacBook series of computers. Around this time Apple also began selling wireless trackpad keyboards, a wireless mouse, and an external hard drive.

The Resurgence

In recent years, Apple has continued to see a resurgence of success. This is in part due to the importance of smartphones and tablets in our culture, as PC software has become less important in recent years.

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In 2011, Microsoft announced that for the first time ever, their profits were lower than that of Apple’s. Recently, customers have seen an improved camera, improved user interface and facial recognition technology. As technology and the world evolves, the sky seems to remain the limit for this once small company started in a California garage.

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