After Steve: How Apple Became a Trillion-Dollar Company and Lost Its Soul

by Tripp Mickle

Though he had started as a wizard of spreadsheets, he was rapidly distinguishing himself as a master politician who had forged global alliances with the presidents of both the United States and the People’s Republic of China. A single sentence from his mouth could send the world’s stock markets into free fall.

The truth was, Ive had been slipping out of focus for years. Apple was no longer his beautiful creation. He was no longer the star of the show. The cameras no longer clicked for him, and news anchors no longer invited him to wax poetically about design. The outside world wanted to know what the company was going to do about tariffs, immigration, and privacy. They wanted Cook. The creative soul of Apple had been eclipsed by the machine.

Apple’s most ardent customers were as fervent about and protective of the company as members of a religious cult. Some tattooed its corporate logo or advertising phrases onto their wrists.

Sicko

about California, he wanted to see if it held up to his imagination. He arranged informational interviews with several design firms, including Lunar Design. Cofounded by Robert Brunner, an industrial design graduate of nearby San Jose State University, Lunar had recently picked up work from Apple for a new computer and was developing a reputation as an upstart design firm with a relaxed surfer vibe.

Eager to find new ideas, he remembered Ive and proposed that Tangerine take on a project designing four speculative Apple products: a tablet, a mobile keyboard, and two desktop computers. The project, code-named Juggernaut, intimidated Ive. It was the first time he’d been given a chance to work with a company whose designs he admired. He assumed responsibility for the tablet and could be seen seated in the studio pretending to type on a foam model of a keyboard. The resulting design had a screen angled like a drawing board.

Though Ive had accomplished so much in the eyes of his peers, he distrusted the accolades and still saw faults in much of his work. “He was genuinely nervous,” Bailey said. At Apple, Ive feared his shortcomings as a designer would be exposed. He worried about what lay ahead.

Industrial engineering had grown out of the early part of the twentieth century as manufacturers sought ways to improve production. It is distinct from other engineering disciplines because it puts less emphasis on science and instead stresses using math to identify ways to improve complex processes such as creating a more efficient factory line or streamlining a hospital emergency room. Like many of his classmates, Cook enjoyed the intersection of math and people. The program taught him to think and question everything. His classmates said the one thing they had learned to ask about everything was: “Why is it done this way?” The school taught them that the common answer—“It’s just the way it’s done”—was unacceptable and urged them to ask follow-up questions to help them isolate what was important about past practices and identify what could be improved.

The decision pushed him into the world of computers, a field he’d never really considered, and helped shape his belief that a rewarding life requires a mix of preparation and good fortune. When he returned to Auburn decades later to give the 2010 commencement address, he urged graduates to prepare themselves in anticipation that their opportunity would come just as his had that day with the recruiter from IBM. “We rarely control the timing of opportunities, but we can control our preparation,” he said.

With a mandate from on high, two IBM managers, Philip “Don” Estridge and William Lowe, led the development of an Apple II rival that buyers could configure as they wished with the software and the disk drive of their choosing. The resulting IBM Personal Computer, or PC, surged in popularity, and the division behind it went from no sales in 1980 to nearly $1 billion in sales by the time Cook joined in 1982.

IBM had adopted the practice from Japan in the 1970s as it sought to ward off the growing competition from Asia and become the world’s lowest-cost producer of computers. The company also taught Cook the value of finding reliable, low-cost suppliers. To build its PC business, IBM dumped its decades-old bias toward making its own components in favor of low-priced alternatives from smaller suppliers. Doing so enabled the company to quickly catch up to Apple in the PC business and minimize its costs. While managing suppliers and minimizing inventory became one of Cook’s strengths, it was his energy and work ethic that raised his profile.

Between Christmas and New Year’s, he volunteered to run the manufacturing operations for IBM’s PC business. It allowed his bosses to spend time with their families and gave Cook the responsibility for shipping products critical to IBM’s end-of-the-year results. Cook’s bosses began to see him as a reliable leader and recommended that IBM pay for him to earn an evening MBA at nearby Duke University’s Fuqua School of Business. Courses in finance, strategy, and marketing broadened his appreciation of business disciplines that were outside the scope of his supply-chain job. In marketing, he studied Jobs’s famous “1984” commercial. He was fiercely loyal to IBM but loved the ad.

Shortly afterward, Cook faced another unexpected personal challenge: he was diagnosed with multiple sclerosis. The disease threatened to disable his brain and impair his spinal cord. He later learned that it had been a misdiagnosis, but the health scare inspired him to raise money for MS research and contributed to a period of introspection. Around that time, he found himself asking: What is my life’s purpose? “It began to dawn on me then that the purpose of life wasn’t to love your job,” he told a group of Oxford students two decades later. “It was to serve humanity in some broad way, and the outcome of doing that would mean that you would love your job. I began to realize I wasn’t in a place to do that.”

Brunner quit Apple in the middle of it, tired of nonstop meetings and eager to return to consulting. Before departing, he encouraged his boss, Howard Lee, the head of computer hardware, to promote Ive to design director. Lee wanted to conduct a worldwide search, but Brunner warned him, “You’re going to lose the team.” Apple was in no position to recruit an outsider. Under Spindler, its troubled business worsened. It underforecast demand, had to recall a laptop model that had burst into flames, and laid off 16 percent of the staff to control the runaway costs. The CEO was eventually ousted and replaced by board member Gil Amelio.

Jobs pressed to create a portable music player. The nascent MP3 market sparked dreams of a next-generation Sony Walkman. The project took flight after Jon Rubinstein, the head of hardware engineering, discovered that Toshiba’s semiconductor unit had created a miniature disk drive that would hold a thousand songs. He pushed to buy the rights to every disk Toshiba made. To run the project, Jobs hired Tony Fadell, a hardware engineer who had worked on General Magic’s personal digital assistant. Rubinstein and Fadell assembled the components, while Apple’s head of marketing, Phil Schiller, contributed the idea of creating a wheel to scroll through songs, a concept inspired by a Bang & Olufsen phone. They handed the ingredients to Ive to package.

At the time, he reported to Rubinstein with a dotted line to Jobs. His insistence on specific design features provoked clashes over details ranging from the polish he wanted on a computer to the specially designed screws he insisted it include. Rubinstein, who brought together all aspects of a product from chips to firmware to design, rejected some of Ive’s ideas as too expensive. Ive bristled. He disliked conflict and disdained design compromises, so he went around Rubinstein to Jobs. Colleagues compared them to two little kids fighting for Jobs’s attention. Jobs’s advisers urged him to stop enabling Ive. Eventually, Rubinstein left and later became chief executive officer of a rival device maker, Palm. Afterward, Jobs streamlined Apple’s reporting structure so that Ive reported directly to him, ensuring that the designer was the second most powerful figure after the CEO.

“I’m not going to let someone drive the bus just because their fucking legs are long enough to reach the pedals,” he would say.

The designers enjoyed more perks than their peers did. They went to off-site retreats at five-star resorts in California’s wine country. They stayed at luxury hotels in Asia, while colleagues in operations and engineering stayed at more traditional three- or four-star places. In Hong Kong, Ive’s hotel of choice was the Peninsula, a five-star colonial building that served afternoon tea as a string quartet played. Apple pampered them.

While at Compaq, he had gotten to know Terry Gou, the founder of Foxconn Technology Group. The Taiwanese entrepreneur had built one of the world’s most reliable assemblers of electronics. With $2,500 borrowed from his mother in 1974, he had set up a factory in Taipei to make plastic knobs to change TV channels before expanding into PCs in the 1980s. He had transformed computer manufacturing by setting up factories in China, where land and labor were cheap. Production contracts with Dell, Compaq, and others had increased the company’s workforce to thirty thousand and its sales to $3 billion. Known to work sixteen-hour days, he demanded that products be released on schedule and in line with customers’ specifications. He would personally step in to solve production problems. His demanding, hands-on style appealed to Cook,

Though Cook had a strong connection with Jobs through work, he had only a distant relationship with Jony Ive. The inherent tension between operations and design sometimes put the two at odds. Cook’s duty was to control costs by manufacturing as many products as possible with a minimum number discarded because of defects. Meanwhile, Ive’s team was scrutinizing products coming off the assembly line to make sure that they were a close approximation of their sketches and models. When Ive identified an imperfection, it could disrupt production. It ate up time and added costs. But Apple’s supply chain began to be reshaped by the mixture of Cook’s demand for operational excellence, Ive’s insistence on superior design, and Jobs’s willingness to spend what was necessary to make amazing products.

Chinese suppliers would clamor to work with Apple because its production demands and the number of products it sold could help manufacturers build their businesses. Cook’s operations team would use their demand to Apple’s advantage, hammering suppliers for lower prices than they offered anyone else in the market. The suppliers often agreed to the onerous terms, knowing that they could learn cutting-edge manufacturing techniques from Apple’s engineers and then market those capabilities to other consumer electronics companies eager to catch up to Apple in product design. The dynamic deepened Apple’s dependency on China and China’s dependency on Apple.

Forstall’s doubt irritated Ive. The designer believed that ideas were fragile, tentative things that came at unexpected times from unknown places. Rising up out of the ether, they initially seem obvious and brilliant but can quickly be deemed impossible, squashed by the recognition of some insurmountable hurdle that could prevent them from becoming a reality. He and Jobs shared a belief that ideas should be nurtured, not crushed. Now one of his most important ideas in months was being battered by a colleague’s misgivings.

When Jobs had returned in 1997, he had put the entire company under a single profit-and-loss statement and created an organization whose senior vice presidents managed the various areas of the business.

iPod

This is apparently a mistake

most of all, they talked about it freeing people from the tyranny of their phones, delivering text messages to their wrists, and allowing them to make calls or listen to music on the go—a leap, they agreed, that would require wireless headphones. And just like that, the watch birthed another wearable product.

Todd Pendleton assembled Samsung’s scrappiest marketers to plan an assault on the smartphone king. It was fall, the season of the iPhone, and Samsung’s chief marketing officer in the United States had an idea for a disruptive advertising campaign that would turn the precious descriptions Apple lavished on its newest device from commercial rites into irreverent ridicule.

The capital repurchases lifted Apple’s stock price and quieted Icahn, who eventually sold his shares for a profit of $1.83 billion. Cook cannily followed Icahn’s advice and drove the company’s share price up by doing something his predecessor would never have considered.

Some simply tried to process how a company that had flirted with bankruptcy and adopted the mindset of a Depression-era grandmother had arrived at a place where it was considering spending so much money on a tent.

The complaints exposed the folly of Cook’s decision three years earlier to sharpen the company’s functional structure after firing Forstall. Ive had wanted a voice in software design, not necessarily oversight of a new division. A good corporate soldier, he had assumed that duty willingly, only to later regret it. Rather than protect Ive and provide him with space to be creative as Jobs once had, Cook, who lived to work, had asked Ive to do the same. He had squeezed more out of the artist than the artist had to give. Ive wanted to leave.

Joanna Stern was blunt: “I don’t love Apple Music.” She said it “lacks polish and simplicity” and compared its lists and menus to Russian nesting dolls.

He and Abrams, who sat to his left, had become friends and creative muses. Ive told The New Yorker that he had advised Abrams over dinner to make a future Star Wars lightsaber “more spitty,” giving it an unevenness that would make it more primitive and menacing. It was a visual concept that Abrams had felt compelled to try. The result was villain Kylo Ren’s ominous laser sword.

j.j. Hasta lo buebo es robado o prestado

The partial iTunes suspension unsettled Cook. He had spent a decade building a business in China and was now being told by his people on the ground that his vision for the future there may be unrealistic.

The Chinese Communist Party was known to punish foreign companies it deemed too large or powerful. Often it did so with an invisible hand by unleashing China’s shuijun, or “water army,” a group of government-backed influencers who shaped public opinion about brands on Chinese social media.

In October, Cook flew to Shenzhen to announce plans to create a $45 million research and development center there. The public affairs team had suggested offering it as an olive branch to the Chinese leaders. They told Cook that it would convey that Apple was committed to China and would assist in its efforts to become a more technologically advanced nation. He met with Chinese premier Li Keqiang and other leaders during the trip.

The email alarmed Ive and Dye. They feared that the message Chaudhri sent could be interpreted to mean that Apple’s best days had passed. Its river had run dry. It was one thing for outsiders to say that the company was no longer innovative, but another thing altogether for that critique to come from someone who had helped birth multitouch technology for the iPhone. They worried it would poison morale and moved to contain the damage. Shortly after the email, Dye fired Chaudhri. The move had crushing financial ramifications. Chaudhri would no longer receive his shares. Stung, he complained to friends about the dismissal, telling them that Ive and Dye misunderstood his comment about the river. He explained to those people that the email was a personal reflection on his own lack of joy, not a comment on Apple.