The Day That Apple bought NeXT
A moment that changed everything.
On this day in 1996, Apple CEO Gil Amelio announced the company was acquiring NeXT, the company founded by Steve Jobs after he had been fired from Apple eleven years earlier. Apple would use the NeXTSTEP operating system to replace the aging Mac OS, and Steve would return to Apple as a “special consultant”.
I’ve been thinking this morning about how that transaction changed everything in Silicon Valley.
The backstory, of course, is that Steve had been fired/quit from Apple in 1985, and famously was so pissed-off that he sold all of his Apple stock except one single share that he kept as a souvenir.
He then took that cash and founded a new company, NeXT, to build the perfect next-generation computer (driven by love and rage). My office was in Palo Alto, just a few blocks from his house, and we’d run into each other occasionally at the new Whole Foods that opened at Emerson and Homer, where he’d go for his fresh vegan juice blends.
The NeXT computer was a work of art. A solid black cube running a lightning-fast 25 MHz CPU, a magneto-optical drive, and built-in ethernet. But most impressive of all was the new operating system, NeXTSTEP. Object-oriented and multi-tasking, it was based on Unix and had power and flexibility that went far beyond any other desktop operating system on the market.
But the price of the machine was too high. A base price of $6,500 put the computer out of the range of most consumers and it was never embraced it as widely as he hoped.
Its wider impact was huge, however. Tim Berners-Lee used a NeXT Computer to create the first Web browser and first Web server, pretty much creating the Internet as we know it today. John Carmack wrote Doom on a NeXT Computer, creating an entire computer game franchise that lives on today. And NeXT’s WebObjects was the first web application framework, and the first to produce dynamic web pages, a huge thing.
Because of NeXT, a whole new generation of computing was happening, with the internet at the center of everything, and Apple was way behind the curve. They needed to do something, and the acquisition of NeXT would allow Cupertino to leapfrog themselves back to where they needed to be.
If you are reading this on a Mac right now then you are using the NeXTSTEP operating system, in fact, which Apple re-branded as Mac OS X. Or maybe you’re reading this on an iPhone, in which case iOS is also built on the XNU kernel from NeXTSTEP. Same with Apple’s tvOS and watchOS. They are all built on NeXTSTEP.
The biggest plot twist was yet to come, of course. Seven months later, the “special consultant” Steve Jobs conducted a boardroom coup during the July 4th weekend, ousting Gil Amelio and re-instating himself as the King of the World.
The day that Apple bought NeXT eventually led to the iPhone which led to Android which led to a million other things. I think we can safely say that Apple would not be the company it is today if it wasn’t for the NeXT acquisition. They paid $400 million to buy the company that day, and Apple now has a market capitalization of over $3 trillion. Seems like pretty decent ROI.
