Why Steve Jobs Was Fired From Apple

"WEBVTTKind: captionsLanguage: enBack in 1976 Steve Jobs co-founded Apple.And during his time at the company, he builtan incredible legacy that continues to beadmired today.But things weren’t always smooth sailingfor Steve Jobs.In fact he was fired from Apple in 1985, onlynine years after starting the company.So in this video we’re going to take a closerlook at the events leading up to his removal,and investigate why it happened.This is Greg with Apple Explained, and I wantto thank Squarespace for sponsoring this video.If you’d like to help decide which videotopics I cover, make sure you’re subscribed,and voting polls like this one will show upin your mobile activity feed.So you may be wondering, how can Steve Jobsbe fired from his own company if he’s theone in charge?And the truth is, he wasn’t in charge.Jobs was just 21 years old when he co-foundedApple.And that earned him a lot of skepticism overwhether he was mature enough to successfullyoperate a multi-million dollar company.So to put those concerns to rest, a more experiencedbusinessman named Michael Scott joined Appleto serve as their CEO.Steve Jobs never actually had that title untilhis return to the company in 1997.And while it freed up his time to lead productdevelopment projects like the LISA and Macintosh,it also mean he didn’t have as much decision-makingpower, and that’s a big reason why he wasable to be forced out of Apple to begin with.But the biggest irony is that the man whoallegedly fired Steve Jobs, was someone Jobshimself set out to hire.That man was John Sculley, and he actuallyplayed a very active role at Pepsi.Where he turned around their food operationsdivision from losses of $70 million a year,to profits of 40 million.He also led research that resulted in Pepsicreating the first two-liter bottle in 1970.And he created the Pepsi Challenge ad campaign,which was very successful in stealing marketshare away from Coke.So because of his impressive performance atPepsi, Jobs poached him very aggressivelyfor Apple’s CEO position.Sculley was initially reluctant, but thatchanged when Jobs asked him, \"Do you wantto sell sugared water for the rest of yourlife?Or do you want to come with me and changethe world?\"That sealed the deal, and John Sculley becameApple’s CEO in 1983.Now during this time the company wasn’tdoing very well.They’d gone through two CEOs already, MichaelScott and Mike Markkula, and neither wereable to create a follow up computer to thewildly successful Apple II.The company was simply selling iterationsof that product, while trying to figure outwhat the next big thing might be.Jobs thought the future of computing wouldbe based upon a graphical user interface.Which features a mouse, cursor, and virtualdesktop with icons and folders.Jobs led the effort to create Apple’s firstcomputer with a graphical user interface,and it was called LISA.Which he claimed stood for Local IntegratedSystems Architecture, but later admitted wasnamed after his daughter Lisa.The computer was praise for being a technicalmarvel, but those advanced technologies cameat a cost of $10,000.And that price tag alone put the LISA outof reach for everyday consumers, and resultedin just 10,000 sales over its two year lifespan.The LISA was a commercial flop, and Apple’sleadership was getting nervous.Although the Apple II was still a big seller,it’s days were numbered.And Apple needed a successful followup machinebefore the competition beat them to it.And something else every YouTube or businessowners needs to stay competitive is theirown website.Which, of course, you should build with Squarespace.I actually started using Squarespace yearsago to create appleexplained.com, and I chosetheir platform since it has a super easy-to-usedrag and drop interface and the most websitetemplates to choose from compared to any othersite builder.But what I thought was really cool is thatI could add an e-commerce store to my sitewhen I was selling merch a couple years ago,without starting over from scratch.Plus the payment processor was built in andI could print shipping labels straight fromSquarespace.But you can sell more than physical items,it’s also possible to sell digital itemslike eBooks and Music, or services if you’rea consultant or fitness coach.It really is an all-in-one platform designedto do almost anything you can imagine.And you can get all this for cheaper thanyou might think, especially if you use thelink squarespace.com/appleexplained sinceyou’ll get 10% off your first purchase,you can find that link in the description.Again, Steve Jobs led the effort on a newmachine with a graphical user interface calledthe Macintosh.It combined the low production costs of theApple II with the advanced technology of theLISA, and was expected to be a hit with customersand businesses alike.But there was one area of debate: it’s price.Jobs wanted to sell the Macintosh for $2,000.This would put it in a very competitive positionagainst other retailers like IBM, who soldPCs for around $1,600.But Apple’s CEO John Sculley disagreed.He told Jobs the price of Macintosh shouldbe $2,500 in order to recoup all the developmentand marketing costs that were incurred beforeits release.The two argued over this detail for months,and marked the beginning of a war that wouldend their friendship for good.Because when Apple’s board of director’sagreed with Sculley, that the Macintosh shouldsell for $2,500, it gave Jobs a convenientexcuse to give if the product failed.He could simply say, “well of course itfailed, because priced it too high.”And that’s exactly what happened.Despite the Macintosh being extremely wellreceived by consumers and critics, and experiencingpromising sales for its first few months,demand quickly tapered off.And again consumers were flocking to IBM machinesfor the biggest bang for their buck, ratherthan buying a radically new and expensivemachine from Apple that didn’t even havemuch support from software developers sincewriting applications for a graphical userinterface was troublesome and time-consuming.This is when tensions between Sculley andJobs reached an all-time high.The board of directors wanted Sculley to exercisemore control over Jobs, who was spending histime on expensive projects that amounted inzero commercially successful products.The Apple II was still paying the company’sbills, and that machine was technically createdby Steve Wozniak.So Jobs really was looking to create his ownhit product, but hadn’t found right recipe.The problem was, Apple’s leadership wasn’tgoing to sit around and watch him drain theirbank accounts waiting for that happen.So Sculley made the tough decision to reduceJob’s roles and responsibilities withinthe company.But Jobs himself found out about this planbefore he was supposed to.And he used that time to put together a planof his own.He formed an alliance with other employeesand tried organizing at coup to take overthe leadership roles at Apple and force theexisting members out.But it was too little too late, Sculley caughtwind of this effort and called for an emergencyboard meeting to address the issue.And it was at this meeting when Steve Jobswas told that his day-to-day decision makingpower within the company would be removed.And that he’d have his own corner officewith the freedom to experiment with emergingtechnology as he wished, except he wouldn’tbe able to lead any projects and no one wouldreport to him.Jobs didn’t accept this offer, and insteadforced the board to vote on who they’d preferas Apple’s leader: Himself, or Sculley.But this is where Jobs made a fatal mistake.He genuinely believed that the board was onhis side.So when they unanimously voted in supportof Sculley, Jobs was stunned.And he stormed out of the meeting in anger.So that means technically, no one fired Jobs,but he lost so much control of his own companythat he preferred to leave and start a newone.That’s exactly why NeXT Computer was founded,as well as PIXAR, but that’s a completelydifferent story for another time.Also, the saga of Steve Jobs return to Appleis just as epic so make sure you’re subscribedbecause I’ll definitely include that topicin a future voting poll.Alright guys thanks for watching till theend, don’t forget I do have a podcast channelthat I upload to every Friday if you’d liketo hear my thoughts on more current Appletopics, and I’ll see you in the next video.\n"