iGod: Could Apple survive without Steve Jobs?

view gallery VIEW GALLERY

He shaped the company in his own image, turning it into the world's most influential consumer brand. But now rumours of ill-health and uncertainty over the succession have sent Apple's stock tumbling. David Usborne reports

Imagine fans showing up for next month's annual all-things-Apple shindig in San Francisco, the Macworld Expo, and being handed a programme, out of which flutters a paper insert with the message: "Steve Jobs is indisposed today. The role of 'Demi-God' will be played by Philip Schiller." Bummer.

Happily, the inserts won't be necessary, because the company, which is based in Cupertino, California, was kind of enough to give everyone a little warning. (Only a little one, mind you.) There it was, late on Tuesday afternoon, a statement saying just that. The moment when Jobs is meant to take to the stage, in jeans and black turtleneck shirt, to unveil one more "One More Thing..." won't happen. And yes, his leading role in the proceedings will be played instead by Schiller, Apple's top marketing person.

Actually, we need to be very clear here. The statement from Apple, which sent its shares into an instant swoon on Wall Street, did not mention "indisposed", but tried to argue that Macworld, an event that is seen as akin to a pilgrimage to Mecca by diehard "Macolytes" (they really are called that), had become superfluous to the company. Indeed, the statement said that after 2009, the company would forgo attendance at the event altogether. The point, apparently, is that Apple has 250 spiffy retail shops these days (there was a time not so long ago when it had none at all) and a mighty marketing presence on the internet with its own website.

So who needs trade shows? Steve Dowling, a spokesman, underlined the message, lest there be any misunderstanding. "Phil is giving the keynote because this will be Apple's last year at the show," he said. "It doesn't make sense for us to make a major investment in a trade show we will no longer be attending."

Well, that is a relief, because there was a time earlier this year when all the world was fretting that Jobs, 53, who is a survivor of pancreatic cancer which was diagnosed in 2003, might be very unwell again. People worried especially after his appearance at another Apple event in July when he looked thin to the point of gaunt. The chatter subsided slightly after another appearance in September saw him looking a little more chipper. But now we have this. What are we to make of it exactly? Is he, in fact, as gravely ill as we had all feared?

Normally, a CEO opting to skip just one more product presentation would be no big deal. (It can even be a blessing). But it's different with Jobs – who co-founded Apple with Steve Wozniak back in the late Seventies, introduced the Macintosh personal computer then left after a boardroom scuffle with then-CEO John Sculley in 1985 and returned to save the company from gathering oblivion in 1995.

The term "reality distortion field" was coined by colleagues at Apple many years ago to try to describe what happens in a room when Jobs begins his sales patter for the latest wonder from the company's research laboratories. First among his many roles at the company is brand-promoter-in-chief, and no one can do it better.

Nor is Macworld just any insignificant trade gathering. It is true that Apple has had increasingly strained relations with its organisers, the Massachusetts-based publisher IDG, and that it had already pulled out of a similar event that used to take place on the East Coast. It is also worth acknowledging that there could hardly be a worse time of year – just after Christmas – for any company to be introducing a new product. But, then again, it was at Macworld two years ago that the company introduced the iPhone and, long before that, its iTunes platform for digitally downloading music. Apple would have a hard job honestly arguing that Macworld has not been pivotal to the vast improvement in its fortunes of late.

So the notion that the fielding of Schiller instead of Jobs is something boringly bureaucratic is hard to swallow. Going to Macworld without Jobs will be a bit like paying for tickets to see Houdini escape from a welded trunk with a stand-in called Robert. "Nooo...", was the most common response in comment threads on the numerous Apple-centric internet blog sites yesterday. "Macworld is like a second Christmas! Santa Steve, don't do this to me!" pleaded someone who goes by the cyber-name of robbydigital.

"It was a huge marketing venue for them," said Richard Shim, an analyst with the research firm IDC, after hearing the Apple announcement. "You've seen those crowds. It was like the Pope was visiting. I think the pressure kind of got to them."

For a hint of the significance of Apple's announcement, consider what happened to it shares – down nearly 6 per cent in the first hours of trading in New York yesterday – partly as a result of the Oppenheimer analyst Yair Reiner downgrading the stock in response. Or look at how this perfectly executed fake press release supposedly from Apple, posted on the net by some smart alec yesterday, reminds us through tongue-in-cheek humour of the near-sanctity of Jobs for some of his disciples.

"December 16, 2008 – Apple today announced that this is the last year for Christmas. Philip Schiller, Apple's senior vice president of Worldwide Product Marketing, spoke at a joint press conference held with Santa Claus at the North Pole. He announced: 'Apple has been honoured to work with the North Pole the last several years to make Christmas possible, however, we have decided together that this is the last year for Christmas. Apple is reaching more people in more ways than ever before, so like many companies, Christmas has become a very minor part of how Apple reaches its customers.'"

For IDG, Macworld's organisers, the Apple announcement is a body blow. It is hard not to imagine that without Jobs – without Apple altogether – the expo will not start to wither, even though the company's general manager, Paul Kent, yesterday insisted otherwise. "Macworld has thrived for 25 years due to the strong support of tens of thousands of members of the Mac community," Kent said. "We are committed to continuing to serve their interests," he said in a statement. Plans for 2010 are already in hand.

But the far bigger question, of course, concerns Apple and Jobs. "The faithful are praying that Tuesday's announcement is exactly what Apple says it is," wrote Josh Quittner of Time magazine's online edition, "and not at all what it looks like." What it looks like – to Quittner, for one – is another Jobs health scare. Or, put even more bluntly and unkindly, that Jobs may be struggling with mortality again.

Some expert watchers of Apple on Wall Street and beyond believe it is possible that the usefulness of Macworld to the company is fading. It could be that Apple is tiring of the strictures of having to come up with something new every January to satisfy expectations, and that it wants to turn down the glare a little bit because this New Year it simply wouldn't have had anything very thrilling for Jobs to show off. John Gruber, who runs a respected Apple blog called Daring Fireball, offered: "I think that the set-in-stone scheduling of Macworld Expo has always been a thorn in Apple's side. January looks worse and worse as a month for major announcements."

Others argue, meanwhile, that there is something unethical about the endless speculation surrounding Jobs's state of health by members of the media. He is a human being with children (who presumably have access to all that is being written) and is entitled to his privacy. And it is true that the repeated, "Is-he-dying? Is-he-not-dying?", headlines are being written on the basis of no concrete evidence whatsoever. He may be thin, for all we know, because he has discovered the joys of a cottage-cheese diet or because post-cancer he is on a strict dietary regimen imposed on him by his doctors. Thin is good.

But Jobs is no ordinary citizen. Nor is he any ordinary CEO. When he returned to Apple in 1997, the campus at Cupertino was a place of almost suffocating gloom. The Apple computing platform commanded roughly 3 per cent of the market, a total washout alongside the hegemony of the PC, developed by Microsoft in Seattle. The effect of Jobs's return has been nothing short of miraculous. Thanks to a combination of aesthetic cleverness – you remember how groovy those iMacs with the sort of blue-translucent back casings were just 10 years ago? – and amazing innovations that led to the "i" revolution in Cupertino (iPod, iTunes and now the iPhone), he has led the company to even greater heights. The effect, however, has been to make Apple without Jobs hard to imagine.

And if Apple, with its 20,000-strong workforce, is irritated that we should all be obsessing about Jobs and his white-blood-cell count, it has itself to blame in part. When Jobs was diagnosed with pancreatic cancer, which is a serious condition however you cut it, in 2003, it took the company about nine months to alert the public and shareholders to the fact. The result of that has been to make everyone just a wee bit sceptical about anything it says, or does not say, on the subject now.

Then there is the small matter of the succession after Jobs disappears, whether because of sickness or indeed any other reason. This is a tricky one, of course, precisely because what will Apple be without Jobs at the helm? There are few major companies in the world that are so intimately tied to the boss, both in public perception and in their day-to-day operations. Others are perhaps the Virgin Group (Richard Branson), or Cuba Inc (the Castros). (We will not mention Madoff Investment Securities and Bernard Madoff just now.) Henry Blodget, the former banker and now Silicon Valley analyst, has said that Jobs is "arguably Apple's single most valuable asset".

But then Microsoft used to be synonymous with its creator, Bill Gates, and has managed its own transition to existing without his daily presence with a minimum of drama and fuss. Gates has left the building, in case anyone out there hadn't noticed. We are told that succession plans are being aired inside Apple, and there have been hints of this precisely because of the increased spotlight that has been shone at recent trade shows on other top-level executives at the company, including Schiller and also Timothy Cook, Jobs's chief operating officer. (There has even been an effort by some of them to mimic his black-top, jeans-bottom wardrobe when appearing in public.) But Wall Street clearly thinks it's high time that the succession debate was taken public.

Confirming that he had downgraded Apple stock from "Outperform" to "Perform", Reiner of Oppenheimer left no doubt that he is one of those growing worried again about Jobs. The decision to keep him away from Macworld "has underscored the greatest risk to Apple's long-term success – its dependence on Jobs' health and its apparent lack of a succession plan." He added that it was "past time" for Apple to give investors some clarity about how it envisages the company post-Jobs.

Gene Munster, an Apple analyst at the Piper Jaffray investment firm, thinks Apple could have avoided this week's stock grief by letting Jobs speak next month and cautions against those who read into this flap that Jobs is again gravely unwell. That said, Munster does suggest that, at the very least, we may be starting to see the first phases of whatever succession plans Apple does have being implemented. "While we do not believe that this change provides any indication regarding Steve Jobs's health," he said, "we do believe that it is a sign that we are in the early stages of changing roles in Apple's management structure."

In other words, the era of Steve Jobs at Apple may indeed be nearing an end. A reporter on CNBC yesterday cited sources in Cupertino who insisted that the decision to keep him away from Macworld was "more about politics than his pancreas". So, perhaps, if he begins to retreat from his daily duties then it will be because he has other things he wants to do, beyond simply changing the daily lives of so many of us with those clever little iThingamajigs that we are about to buy for Christmas.

Apple's core: Who will follow Steve Jobs?

Philip Schiller

Front-runner

Schiller has 17 years of marketing management experience at Apple and is current senior vice president of worldwide product marketing, reporting directly to Steve Jobs. He is also a member of Apple's executive team and is credited by the company with "delivering breakthrough products" such as iMac, MacBook, iPod, iPhone and Mac OS X. While he may not have the technical expertise of other potential candidates, and certainly enjoys a less fearsome reputation than Jobs, Schiller has long been his CEO's right-hand man at most Apple public events. Given that a significant part of Apple's success is built on its presentation and public appeal, perhaps he would add a marketing dimension that other key figures at Apple don't have access to. When news broke this week that Jobs would not be the keynote speaker at the Macworld event next January, it was announced that Schiller would deliver the opening address in his place.

Timothy D Cook

Front-runner

Reporting directly to Steve Jobs, Cook is Apple's chief operating officer. Having previously worked for Compaq, as vice president of corporate materials, and for IBM as director of North American fulfilment, his rock-solid technology credentials place him firmly in the running for the top job. At Apple, he is responsible for the company's sales and operations globally, including managing the company's supply chain. Described by 'Fortune' magazine as being "as steady and low-key as Jobs is temperamental", 47-year-old Cook is a fitness fanatic and cycling enthusiast. Although the question of whether he has the charisma to replace his widely revered boss has been raised, he was given him a nod of approval when, in 2004, Jobs put Cook in charge of the company while he recovered from surgery for pancreatic cancer.

Ron Johnson

Long shot

With a focus on the public face of the business, Ron Johnson's profile has rocketed since he joined Apple from the US retail company Target in 2000. Although he has on occasion disagreed with the Jobs on retail strategy – the Apple stores' "Genius Bars" were one such clash – Johnson is widely regarded as one of few candidates to possess the personality and charisma necessary to inherit the top job. Currently serving as the company's senior vice president of retail operations, Johnson has presided over a period of record growth for Apple outlets, with annual sales topping $1bn. In a retail environment that is destined to get tougher in the coming years, and with Apple sales having stagnated, dropping 1 per cent last month, now could be the moment for the company to focus more closely on making sure Apple customers keep coming back for more in this difficult period. Ron Johnson could be the man to tackle the problem head-on.

Jonathan Ive

Front-runner

The 41-year-old from Chingford, east London, is senior vice president of industrial design at Apple. Internationally renowned as the principal designer of the iMac, iPod, iPhone and the PowerBook G4, he was awarded a CBE by the Queen in 2006. To many, after Jobs, Ive best embodies the spirit of Apple and is a favourite potential successor – recently 49 per cent of voters in an online poll said they trusted Ive to run Apple. However, Ive's pathway to Apple's throne isn't quite so straightforward: will one of the world's most influential designers want to give up such a creative role to take on the infinitely divergent tasks of a CEO? Further, Ive is famously private, and may lack the charisma and presentational skills expected of an Apple CEO.

Rank outsider

Eric Schmidt

Could Apple bring in a relative outsider in an attempt to diffuse any internecine conflicts among the major players in the company's top echelons? Perhaps Eric E Schmidt, current CEO of Google and already a member of the board of directors at Apple, would be an ideal, if surprising choice. Schmidt led development of Sun Microsystems' Java technology and ran the software outfit Novell before becoming CEO of Google in 2001, where he has overseen the introduction of new Google products such as Gmail, Google Talk and the Android phone-operating system. Schmidt, with an estimated net worth of $5.9bn, was recruited by Google as the straight man to rein in the "mad scientist" impulses of the company's founders Sergey Brin and Larry Page. His ability to do so could be useful to Apple to keep Jobs acolytes in check, while the Apple CEO role might entice Schmidt as it could afford him greater creative freedom than being Page and Brin's third wheel at Google. With Apple, Google and Microsoft limbering up for a battle over the future of cloud computing, Schmidt's technical background, coupled with his track record in taking on the latter company in the search-engine market, would be a major boon.

Scott Forstall

Long shot

Forstall cut his teeth at NeXT, the software company Jobs founded following his departure from Apple in 1985. The software he worked on there was the precursor to Apple's OSX, and the buy-out of NeXT by Apple in 1997 saw Forstall join the company, in charge of OSX releases, alongside Jobs, who was then appointed Apple CEO. This year Forstall was appointed to senior vice president, after having managed the development of software for the iPhone. His dedication to his previous role bordered on obsessive, as he admitted to 'Time' in 2007: "I actually have a photographer's loupe that I use to make sure every pixel is right," he told the magazine. "We will argue over literally a single pixel." After his series of impressive performances at recent Apple worldwide developers' conferences, some observers are tipping Forstall as a worthy successor to Jobs.

JACK RILEY & LARRY RYAN

News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
Sport
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvHe is only remaining member of original cast
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
PROMOTED VIDEO
Life and Style
ebooksA superb mix of recipes serving up the freshest of local produce in a delicious range of styles
Life and Style
ebooksFrom the lifespan of a slug to the distance to the Sun: answers to 500 questions from readers
Sport
Fans hold up a scarf at West Ham vs Liverpool
footballAfter Arsenal's clear victory, focus turns to West Ham vs Liverpool
New Articles
i100... she's just started school
News
news
New Articles
i100
Life and Style
Couples have been having sex less in 2014, according to a new survey
life
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
Sport
football
New Articles
i100... despite rising prices
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Gadgets & Tech

    Graduate BI Consultant (Business Intelligence) - London

    £24000 - £30000 per annum + benefits: Ashdown Group: Graduate BI Consultant (B...

    Service Delivery Manager (Product Manager, Test and Deployment)

    £40000 - £55000 per annum: Ashdown Group: Service Delivery Manager (Product Ma...

    Technical Product Marketing Specialist - London - £70,000

    £50000 - £70000 per annum: Ashdown Group: Cloud Product and Solutions Marketin...

    Trainee Helpdesk Analyst / 1st Line Application Support Analyst

    £18000 per annum: Ashdown Group: An established and growing IT Consultancy fir...

    Day In a Page

    Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

    Despite the result, this is the end of the status quo

    Boyd Tonkin on the fall-out from the Scottish referendum
    Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

    Manolo Blahnik: Flats, Englishness, and Mary Beard

    The shoe designer who has been dubbed 'the patron saint of the stiletto'
    The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

    Scrambled eggs and LSD

    Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
    'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

    'Normcore': Blending in is the new standing out

    Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
    Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

    New leading ladies of dance fight back

    How female vocalists are now writing their own hits
    Mystery of the Ground Zero wedding photo

    A shot in the dark

    Mystery of the wedding photo from Ground Zero
    His life, the universe and everything

    His life, the universe and everything

    New biography sheds light on comic genius of Douglas Adams
    Save us from small screen superheroes

    Save us from small screen superheroes

    Shows like Agents of S.H.I.E.L.D are little more than marketing tools
    Reach for the skies

    Reach for the skies

    From pools to football pitches, rooftop living is looking up
    These are the 12 best hotel spas in the UK

    12 best hotel spas in the UK

    Some hotels go all out on facilities; others stand out for the sheer quality of treatments
    These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

    Widespread fear of Isis is producing strange bedfellows

    Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
    Topshop goes part Athena poster, part last spring Prada

    Topshop goes part Athena poster, part last spring Prada

    Shoppers don't come to Topshop for the unique
    How to make a Lego masterpiece

    How to make a Lego masterpiece

    Toy breaks out of the nursery and heads for the gallery
    Meet the ‘Endies’ – city dwellers who are too poor to have fun

    Meet the ‘Endies’ – city dwellers who are too poor to have fun

    Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
    Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

    Ian Paisley’s decision to make peace with his IRA enemies

    His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam