Die like IBM, or die like Apple

5. Die like IBM, or die like Apple?

Psion’s confidence about the prospects for its forthcoming 32-bit software system (the future Symbian OS), that was so high when serious coding had started on that system in late 1994, had grown considerably more tentative by the first half of 1996. One reason was the repeated delays in the development project, as mentioned in the previous chapter. But another reason was the changing competitive landscape.

Mounting competition

As the Protea project zigzagged forwards, sideways, and sometimes backwards, with uncertain and seemingly unknowable end date, Psion’s senior management wondered from time to time whether a different software system, obtained from outside the company, might prove a better bet for future mobile products.

For example, there was a period of around a week when senior management were enthralled by the “Magic Cap” system from a Californian company with the audacious name “General Magic”. General Magic had been spun out of Apple in 1990, with the following mission statement (which had considerable resonance to Psion’s own ways of talking about itself):

We have a dream of improving the lives of many millions of people by means of small, intimate life support systems that people carry with them everywhere. These systems will help people to organize their lives, to communicate with other people, and to access information of all kinds. They will be simple to use, and come in a wide range of models to fit every budget, need, and taste. They will change the way people live and communicate.

Over time, hype around General Magic grew more dramatic. Writing in Wired in 1994, http://www.wired.com/wired/archive/2.04/general.magic_pr.html, Stephen Levy foresaw some compelling developments:

With their new company, General Magic, the creators of the Macintosh aim to revolutionize computing – again…

Now that they’ve designed the technology, Bill [Atkinson] and Andy [Hertzfeld] love to talk about its implications – how, in effect, General Magic can change the world.

“I’d be interested to see what happens in schools when enough of the kids have these,” says Bill. “You’d have things like the teacher giving out homework by beaming it up to a bubble on the ceiling which beams it out to other people, and kids are actually able to collaborate by beaming something down to one of their friends. They could arrange a lunch date in the middle of class. Without passing notes.”

Andy is bouncing in his chair, eager to chime in. “Another thing that’s interesting is that we’ll get reviews of things. You know, I love arts, music, and books. The reviews are all going to have buttons on them now: ‘Buy It.’ Or, you know, everything gets intermingled, everything can be a link to something else.”

“Or like I’m listening to the FM radio and I hear a song I like,” says Bill. “I press a question mark and I instantly see the name of the artist and the other songs on the album and the price of the album. And there’s the damn BUY button, and the next day a CD will show up in my house.”

(This vision of the future failed to anticipate the demise of physical CDs or the rise of electronic distribution of music. It’s hard to predict the future!)

Partners and investors for General Magic included Sony, Motorola, AT&T, Philips, Matsushita, and British Telecom. A powerful buzz about the company’s future meant that its stock price doubled on the first day of its IPO in February 1995. It was therefore understandable that Psion senior managers would consider joining the General Magic party, and licence Magic Cap for use in their PDAs. After all, one of them whispered, think of the cost savings from not needing to maintain such a large in-house team of Psion’s own software developers. How much simpler to utilise ready-made software, created by the same team that had achieved such marvels in their earlier careers elsewhere in Silicon Valley! And how cute the Magic Cap software seemed, with its real-world metaphors and winsome bouncing rabbit.

That particular fancy soon evaporated. The Magic Cap software might appear cute, but closer examination revealed shallowness (weak functionality) in practice. The devices brought to market – by Sony and Motorola – were pale shadows of what the General Magic marketing machine had previously led people to expect. In contrast, Psion could see the strength in depth baked into the developing 32-bit Epoc software system. Psion’s development team escaped this particular axe.

Still, seeds of doubt were in the air. General Magic was an example of a new breed of competitor for Psion. These competitors were no longer mainly restricted, as earlier in Psion’s history, to companies who had previously created electronic calculators and simple handheld organisers. They contained managers with stellar track records in the PC and Mac industry – people like (in the case of General Magic) Bill Atkinson and Andy Hertzfeld, who had played major roles in the creation of pioneering Apple computers.

Envisioning the trillion dollar mother-of-all-markets

Apple itself was another competitor with seemingly fearsome potential. Media excitement grew high in anticipation of Apple’s Newton family of devices – with their built-in “intelligent assistant” that was claimed to be able to make sense of sketchy pen jottings and other fragmentary clues about user intent, to do many tasks that previously would have required a first class (human) personal assistant.

The Newton was what Apple CEO John Sculley had in mind, as early as January 1992, when delivering a memorable keynote at the Consumer Electronics Show (CES) tradeshow in Las Vegas. In that keynote, Sculley drew attention to the growing convergence of computing and consumer electronics, and also spoke about multimedia, communications, and increasing miniaturisation. Joining up the dots, he described the forthcoming market for PDAs as a “trillion dollar mother-of-all-markets”.

Sculley’s keynote is noteworthy for a number of reasons:

  • As a sign of changing times, it was the first occasion that the keynote speaker at the CES show was the CEO of a computer company
  • Although Sculley’s stewardship of Apple has received huge amounts of criticism over the years, his vision of the eventual trillion-dollar scale of the PDA market has eventually proven justified (thanks to the convergence of smartphones and PDAs)
  • The vision articulated in the keynote energised numerous companies and individuals to become vigorously involved in creating one or other variant of a PDA.

The first Newton went on sale in 1993. Five years later, with original company founder Steve Jobs back at its helm, Apple discontinued the entire device family. Sales had been extremely disappointing. There were so many unwanted Newtons that InfoWorld blogger Robert Cringely could claim in July 1995 that Apple had been forced

to dump 30,000 brand-new Newton MessagePad 100 PDAs in a Los Angeles landfill, where they were crushed under the treads of a bulldozer.

Although journalists had at first wanted this imaginative new concept to succeed, opinion had fairly quickly turned against the Newton. A series of episodes in the popular American “Doonesbury” cartoon strip lampooned the quirks and foibles of the Newton, and the device even made a guest appearance on “The Simpsons” – where, again, it was the butt of ridicule (the Newton in the cartoon misinterpreted the memo “Beat up Martin” as “Eat up Martha”). An expensive price tag deterred many would-be purchasers, as did the fact that the technology failed to fulfil many of its promises.

Photocopies of the Doonesbury cartoons were prominently displayed on the wall of the kitchen used by the Psion software development team. But alongside our guilty pleasure at the flaws in the initial Apple Newton software, we were acutely mindful of likely future developments.

[ SNIP ]

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