September 2, 1985: Reports claim Apple co-founder Steve Jobs is on the verge of setting up a new company to compete with Cupertino. The rumors fly after Jobs sells Apple stock holdings worth $21.43 million.
For anyone who thinks speculation about Apple’s future is an invention of the blog era, today’s edition of “Today in Apple history” is a reminder that the tech rumor mill was alive and well in 1985.
Steve Jobs sells APPL stock, preps to leave Apple
Those rumors turned heads because Steve Jobs was a rarity in the tech world: a well-known entrepreneur with a singular vision for the future of personal computing. His personal identity became practically inseparable from the company he helped create.
Speculation that Jobs was on his way out at Apple came after he was stripped of his duties as general manager of the Macintosh division. The move came as part of a company-wide reorganization by Apple CEO John Sculley in the summer of 1985. The reshuffling occurred just a year and a half after the first Mac went on sale, to generally good reviews but disappointing sales.
Fortune magazine, in an August 5, 1985, cover story headlined “The Fall of Steve Jobs,” wrote that the Apple co-founder’s diminished role in Cupertino had “aroused intense speculation” about the company’s future.
“Not just another brash young entrepreneur, he is the Johnny Appleseed of personal computing, the leading broadcaster of ‘technology for the people,'” the magazine wrote. “Until June, Jobs led the development and marketing of the Macintosh computer, an easy-to-use, technologically advanced machine on which Apple has staked its future. Many insiders are shocked by his removal; they fear Apple has lost the spirit and vision that made it into a business phenomenon.”
Image: Fortune
Steve Jobs prepares for his post-Apple career
After his practically unthinkable demotion, nobody expected Jobs to stay quiet for long. Even in 1985, the 30-year-old tech exec was well-known to the public, thanks to a sustained PR blitz.
However, relatively few expected Jobs to leave the company altogether. Still, rumors about Jobs’ impending departure gained credibility in early September, when news emerged that Jobs sold 19.7% of his Apple stock in only two months.
In July, he sold 850,000 shares for $14 million. On August 22, he sold a further 500,000 shares for $7.43 million. As trade publication InfoWorld noted on September 2, “The large amounts of stock and high values are stirring speculation in the industry that Jobs will be starting his own venture sometime soon and that he may invite current Apple employees to join him.”
Enter NeXT Inc.
Unbeknownst to the press at the time, Jobs took a very significant meeting in early September 1985 with Nobel laureate Paul Berg, a Stanford biochemist who was about to turn 60. As they lunched, Berg told Jobs about gene splicing and the challenge of conducting wet-lab research.
When Jobs asked why he didn’t simulate it on a computer, Berg’s eyes reportedly “lit up.” (That’s the way Jobs recalled it, at least.) Jobs suddenly had a new idea to think about.
The result, a few months later, would be the formation of NeXT Inc. Jobs’ new computer company initially planned to build educational machines, although its remit later expanded.
NeXT started the next phase of Jobs’ career, and eventually paved the way for his triumphant return to Apple in 1997.
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
