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==Wiki Article: How Apple Regained its Market Share==
 
==Wiki Article: How Apple Regained its Market Share==
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Abstract
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The objective of this research paper was to discover how Apple Inc. regained its market share in the computer industry after being headed toward failure at one point during the early 1990s.  Steve Jobs, co-founder of Apple, was the driving force behind Apple’s success, but he left the company in 1985 following a dispute over business decisions. Apple’s subsequent problems were the result of mismanagement by a string of inept chief executive officers and poor business decisions regarding the licensing of Apple technologies to outside firms.  Stock prices plummeted and Apple sustained a dramatic loss of market share.  If it had not been for the return of Steve Jobs to the helm of Apple in 1997, the company may have failed. Steve Jobs’ return brought back strong leadership and the launch of many innovative products.  First he stopped the licensing agreement that gave rise to Apple clones.  Then he stopped production on 15 of the company’s 19 products, so the focus could be placed on desktop and portable Macintoshes and product innovation.  Under Steve Jobs' strong leadership, Apple launched the many innovative and highly popular products it is so well known for today.  With the release of iMacs, iPods, iPhones and other Apple products, the company has regained its market share and become remarkably successful once again.
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Apple Inc. is a very popular and financially successful corporation, with many well known products in the consumer electronics, computer software, and personal computer market.  However, this has not always been the case.  Apple has had a roller coaster history, which makes it unique in the computer industry.  One may ask how this Fortune 500 Company, which was at one point headed toward failure, regained its market share.  Apple Inc. may have failed if it had not been for the return of co-founder Steve Jobs in the late 1990s, which brought back strong leadership and the launch of many innovative products.
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Established over 30 years ago, in 1976, Apple started out as a small company to distribute the Apple I personal computer kit.  Founded by three young men, Steve Jobs, Steve Wozniak, and Ronald Wayne, Apple entered the emerging personal computer market.  The Apple I would not be considered a personal computer by today’s standards, instead it had to be assembled by consumers, which were most likely computer hobbyists.  Over the next few years, Apple developed improved versions of the Apple I in order to compete with Commodore and Tandy, the two other major personal computer companies of the time.  Steve Jobs wanted to transform Apple into a large company, so he approached Mike Markkula, a former electronics engineer who had managed marketing for Intel Corporation and Fairchild Semiconductor.  Apple benefited largely from this consultation because, “Markkula bought one-third of the company for $250,000, helped Jobs with the business plan, and in 1977 hired Mike Scott as president” (Apple Computer). 
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The Apple II was released in 1977, and it was the product that distinguished Apple from its competitors.  Unlike the TRS-800 and Commodore PET, the Apple II came with color graphics, an open architecture, and storage on a 5 ¼ inch floppy disk drive and interface, the Disk II (Apple Inc).  With Apple becoming one of the fastest growing companies in the United States, the next step was to go public.  By going public, Apple would be able to expand, becoming an even bigger threat to competitors.  In 1980, Apple went public, and within a year, the stock value increased by 1700% (Apple Museum).
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Three years later, in 1980, the Apple III was released.  This release hurt the company in many ways.  The Apple III did not receive sufficient testing before its release, and it turned out to be a defective product.  Production of the unit was halted, the problems were remedied, but sales never compared to those of the Apple II.  In April 1984, Apple decided to discontinue the product.  President, Mike Scott, began to lay off employees after the failure of the Apple III.  Steve Jobs did not agree with this decision.  This discord resulted in Mike Markkula becoming president, Steve Jobs chairman, and Mike Scott resigning as president and leaving the company (Apple Museum).  Despite this difficulty, Apple persevered.  An especially notable event for Apple occurred in December 1982, when “Apple became the first personal computer company to reach $1 billion in annual sales” (Apple Computer).
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The following year, IBM surpassed Apple as Europe’s main supplier of personal computers.  Apple tried to compete with IBM by releasing the Apple Lisa computer, which was the first commercial computer with a graphical user interface or point and click system with a mouse.  The Lisa turned out to be a flop for Apple, not reaching projected sales due to its very expensive price of $10,000 (Apple Lisa).  The stock prices suffered greatly at this time, falling to $35, half the 1982 sale price (Apple Computer).  Jobs tried to rectify the situation by hiring the former president of Pepsi-Cola, John Sculley, to replace Mike Markkula as president.
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The next product to be released by Apple was the Macintosh.  This personal computer also had a user friendly graphical user interface like the Lisa, but it was priced more reasonably at $2,495 (Original Macintosh).  The Macintosh had problems though, with insufficient memory and other system issues.  In the first 100 days, Apple sold nearly 70,000 Macintosh computers, but the follow up sales were not the same (Apple Computer).  Following this decline in sales, Apple also experienced major internal problems.  Steve Jobs no longer supported Sculley’s business decisions and planned to remove him.  Sculley found out about Job’s plan and stripped him of all his operational responsibilities, leaving him with no power in any decision making (Apple Museum).
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Shortly thereafter, Steve Jobs resigned from Apple.  He was the key innovator of the company and without him, the Apple Corporation suffered.  Jobs went on to form another computer company, NeXT Incorporated.  In October 1985, Sculley made one of the worst decisions for Apple's future.  He signed a “contract with Microsoft that would eventually change the computer industry forever and make Microsoft the greatest competition for Apple. The contract granted Microsoft permission to use some Mac GUI (Graphical User Interface) technologies if Microsoft continued producing software for the Mac (Word, Excel). In return, Microsoft agreed to continue developing Word and Excel for Macintosh.  Based on this contract, Apple loses all lawsuits over copyright infringements against Microsoft in the following years” (Apple Museum).  This was Apple’s lowest point in history.  Stocks plummeted to their absolute lowest price (AAPL).
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Apple was plagued by inept management during the 1990s, as a string of different chief executive officers made poor business decisions and stocks plummeted.  In 1993, Sculley was removed from his position.  His successor, Michael Spindler, “broke tradition by licensing Apple technology to outside firms, paving the way for ill-fated Apple clones that ultimately eroded Apple’s profits” (Apple Computer).  In 1996, even under the new leadership of Apple chief executive officer, Gil Amelio, the company suffered financially.  Apple’s trouble grew as its losses reached “$816 million in 1996 and a staggering $1 billion in 1997.  The company’ stock, which had traded at more than $70 per share in 1991, fell to $14 per share.  Its market share, 16 percent in the late 1980s, stood at less than four percent” (Apple Computer).
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For ten years Steve Jobs operated NeXT Inc., and Apple continued to suffer.  The idea of returning to Apple lingered in Jobs’ mind.  In 1995, Jobs actually approached Apple’s newest board-member at the time, Gil Amelio, and declared, “There's only one person who can rally the Apple troops, only one person who can straighten out the company” (NeXT).  Steve Jobs was speaking of himself.  Jobs still had his ties with NeXT; so being the shrewd businessman that he was, Jobs focused on a merger deal between NeXT and Apple.  It was not until December 2, 1996 that Gil Amelio announced, “that Apple would buy NeXT for the price of $427 million and would base the next version of the Mac OS on NeXTstep” (NeXT).  After this deal was announced, Steve Jobs returned to Apple to serve as an advisor and help with the merger.  It had been eleven years since Jobs left Apple.  Finally, in September 1997, two months after Amelio’s exit, Apple’s board of directors named Steve Jobs as interim chief executive officer (Apple Computer).  Steve Jobs was back, and Apple’s recovery was set in motion.
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Now that Steve Jobs was back, the focus at Apple returned to product innovation.  Jobs realized the poor shape that Apple was in, and he was determined to bring the company back to power.  First he stopped the licensing agreement that gave rise to Apple clones.  Then he stopped production on 15 of the company’s 19 products, including printers, scanners, and other peripherals.  The focus of Apple was now placed on desktop and portable Macintoshes (Apple Computer).  By eliminating products, Jobs assembled teams that could focus solely on product innovation and improving the Macintosh.  Jobs reorganized the company and its leadership.  In this process, Jobs also “closed plants, laid off thousands of workers, and sold stock to rival Microsoft Corporation, receiving a cash infusion of $150 million in exchange” (Apple Computer).
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In August 1998, under Steve Jobs' leadership, Apple released a product that had great impact on the computer industry, the iMac.  Ten months earlier, Jobs was determined to create a computer for Apple that was affordable, so he tapped all available resources.  The iMac originally sold for $1299 (iMac G3), almost half the price of previous personal computers sold by Apple.  The iMac was affordable for many more people now, thus revolutionizing the personal computer industry.  This computer did not have a separate monitor, a rat’s nest of power cords, or any external drives.  The iMac became the fastest selling personal computer in history (Apple Museum).  Due to Steve Jobs’ restorative efforts, Apple left the 1990s as a smaller version of its former self, but more importantly, a profitable company once again.  Figures prove, “annual sales, which totaled $11.5 billion in 1995, stood at $5.9 billion in 1998, from which the company recorded a profit of $309 million. In 1999, sales grew a modest 3.2 percent, but the newfound health of the company was evident in a 94 percent gain in net income, as Apple's profits swelled to $601 million” (Apple Computer).  Apple was on the road to reinvention, and this was just the beginning.
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The iMac design team was lead by Jonathan Ive, who would eventually design the iPod and iPhone.  Jobs brought back innovation to Apple, and he knew who to place where to get the best outcome from his talented workforce.  He also knew what consumers wanted and he directed the focus toward developing technological advances to meet consumer demands.  In 1998, Apple purchased Macromedia’s Final Cut software, signaling its expansion into the digital video editing market (PostScript).  The purchase of this software resulted in the development of iMovie for consumers and Final Cut Pro for professionals.  Through the purchase of more software, Apple was able to finalize iLife.  iLife consists of: iPhoto, iMovie, iDVD, GarageBand, and iWeb.  These applications are unique in the computer industry because they can only be accessed on Apple computers.  This venture was a great marketing strategy because Jobs knew that perking consumer interest in applications that could only be accessed on Apple computers would result in an increase in Apple computer sales.
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Over the years, the iMac has become more advanced with each new generation.  Since 1998, the iMac has had seven new generations, each one being remarkably different than the previous generation.  The original iMac had a 15 inch display and a memory ranging from 4GB to 60GB.  Today’s iMac Aluminum has a display ranging from 20 to 27 inches of LCD and a memory ranging from 250GB to 2TB (Apple iMac).  These are quite impressive improvements to have occurred in a relatively short period of time.  What makes the iMac stand out from other desktop computers is how it lacks a separate system unit containing the memory, CPU, power supply and other parts.  This makes the iMac computer one of a kind.  Under Steve Jobs' leadership, release of the iMac computer, over ten years ago, helped Apple to regain its strong position in the computer industry.  Two Apple products, the iMac and the Apple Mac Mini were among the top three best-selling computers in 2009 (Top 3).
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Since Steve Jobs’ return to Apple, the company's products have become sleek, hip and very popular with consumers.  One of the most popular devices created by Apple is the iPod.  Since its creation in 2001, iPod sales have increased nearly 15 fold with total iPods sold measuring at nearly 160 million after the second fiscal quarter of 2008 (Apple iPod).  The iPod has gone through a complete metamorphosis in nine years, from the original iPod to the present day iPod Touch.  Over the past nine years, Apple has released over 15 different models, including: iPod classic, iPod with touch wheel, iPod mini, iPod shuffle, iPod photo, iPod with color display, iPod nano, and the iPod Touch.  Each of these iPod models has multiple generations, each with improvements and increased storage capacity.  The marketing strategy of having new generations of the iPod being released several times a year ensures that there will always be a steady stream of consumers who desire to own the latest and greatest version of the iPod.  If a consumer has been a fan of the iPod since its introduction, it is very likely that he or she has purchased multiple generations of the product.  The iPod is so popular with consumers that it has even been integrated into car audio systems.  Figures show that, “more than 70 percent of 2007 model year cars offer iPod integration” (Apple iPod).  That number is likely even higher for 2010 model year cars.  With the availability of iPod integration in most car models, automobile companies are obviously aware that a vast number of Americans own an iPod.  The iPod dominates the market for personal music players.  There are numerous brands of MP3 music players that attempt to rival the iPod, but none have sales figures that even closely resemble those of the Apple iPod.
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Another very successful Apple innovation, developed with Steve Jobs at the helm, is the iTunes Store.  This online downloadable music store has made Apple Inc. millions of dollars.  The store sells individual songs for download at 99 cents per song.  In addition to songs, the iTunes Store also sells downloadable movies, television shows, applications for the iPod/iTouch, podcasts, and audiobooks.  The iTunes Store does not dominate the market for legal downloadable music, but it does bring in huge profits for Apple.  Even with the existence of illegal downloading, Apple’s iTunes Store has helped boost their profits dramatically.  It had been reported that from the launch of the iTunes Store on April 28, 2003, up to April 1, 2007, 2.5 billion songs had been sold (Macsimum).  Being able to sell 2.5 billion songs in 4 years is a remarkable achievement, and it helped Apple become a major distributor in the music sharing industry.
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Another Apple innovation that is very popular and very profitable is the iPhone.  The iPhone was developed after Steve Jobs directed his engineers to look into touch-screens.  At the time, Jobs was contemplating development of a touch-screen personal computer.  The iPhone was released in the United States, on June 29, 2007, and it could be purchased at Apple Stores and AT&T Stores.  Since the release of the iPhone 2G, there has been development of the iPhone 3G, iPhone 3GS, and the iPhone 4G, released the third week of June, 2010.  Again, Apple profits from a brilliant marketing strategy based on the consumers’ desire to own the latest gadget.  The iPhone is a versatile device that can be used to make a phone call, watch a movie, or send an email, all by the touch of a screen.  AT&T was lucky enough to be the only cell phone provider for the iPhone, making their sales climb just as significantly as Apple’s.  Surprisingly, there has been talk about the iPhone being developed for Verizon and being introduced within the next year (Ross).  If this happens, the iPhone has the chance of becoming the most widely sold cell phone in history.  Another victory for the company Steve Jobs brought back to life.
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Apple’s image today consists of it being a very successful company with innovative products that consumers desire to own.  This is a complete turnaround from the image it had in the early 1990s, as a company on the brink of failure with inept management.  It was the return of co-founder Steve Jobs, in the late 1990s, that turned Apple around, returning it to profitability and regaining its market share.  Under his strong leadership, Apple launched the many innovative and highly popular products it is so well known for today.  He reorganized the company and narrowed its focus.  Steve Jobs was the driving force behind Apple’s phenomenal return to success.  One can only image what the future holds for this incredible company under the leadership of this incredible man.
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References
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AAPL: Basic Chart for Apple Inc. - Yahoo! Finance. (n.d.). Yahoo! Finance - Business Finance, Stock Market, Quotes, News. Retrieved June 19, 2010, from http://finance.yahoo.com/q/bc?s=AAPL&t=my&l=on&z=m&q=l&c=
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Apple Computer, Inc.  -- Company History. (n.d.). Connecting Angel Investors and Entrepreneurs. Retrieved June 18, 2010, from http://www.fundinguniverse.com/company-histories/Apple-Computer-Inc-Company-History.html
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Apple iMac Specs (All iMac Technical Specs) @ EveryMac.com. (n.d.). Mac Specs, Prices, Answers, & Comparison @ EveryMac.com - Est. 1996. Retrieved June 20, 2010, from http://www.everymac.com/systems/apple/imac/index-imac.html
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Apple Inc History. (n.d.). Sooper Articles - Submit Articles - Free Ezine Articles Directory. Retrieved June 18, 2010, from http://www.sooperarticles.com/technology-articles/apple-inc-history-3733.html
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Apple iPod Sales Statistics. (n.d.). mLearning Hub - How eLearning Goes Mobile. Retrieved June 20, 2010, from http://www.mlearninghub.com/ipod_sales.html
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Apple Lisa. (n.d.). Free hosting, web hosting, domain names and web design | Fortunecity. Retrieved June 20, 2010, from http://www.fortunecity.com/marina/reach/435/lisa.htm
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iMac G3/233 Original - Bondi (Rev. A & B) Specs (iMac - Original, M6709LL/A*, iMac,1, M4984, N/A) @ EveryMac.com. (n.d.). Mac Specs, Prices, Answers, & Comparison @ EveryMac.com - Est. 1996. Retrieved June 20, 2010, from http://www.everymac.com/systems/apple/imac/stats/imac_ab.html
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iMac, MacBook top retail PC sales in US | Electronista. (n.d.). Technology, Gadgets, Mobile Phones, iPad, DVR, GPS, Camera, Music News | Electronista. Retrieved June 22, 2010, from http://www.electronista.com/articles/09/12/04/npd.has.apple.dominating.october.retail/
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Macsimum News. (n.d.). iTunes sales increasing dramatically on an annual basis.  Retreived June 20, 2010, from www.macsimumnews.com/index.php/archive/itunes_sales_increasing_dramatically_on_an_annual_basis/
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Original Macintosh 128k. (n.d.). Low End Mac: Worth It!. Retrieved June 20, 2010, from http://lowendmac.com/compact/original-macintosh-128k.html
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PostScript., Geschke, b., & So, W. r. (n.d.). FRIENDS AND FOES / Despite squabbles, Apple and Adobe have benefited from one another. San Francisco Bay Area — News, Sports, Business, Entertainment, Classifieds: SFGate. Retrieved June 20, 2010, from http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2002/02/25/BU107610.DTL&type=tech
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Ross, A., & Images, A. (n.d.). Apple and Verizon consider iPhone deal - USATODAY.com. News, Travel, Weather, Entertainment, Sports, Technology, U.S. & World - USATODAY.com. Retrieved June 22, 2010, from http://www.usatoday.com/tech/wireless/phones/2009-04-26-apple-verizon-iphone_N.htm
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The Apple Museum | 1980 - 1989. (n.d.). The Apple Museum | Home. Retrieved June 18, 2010, from http://www.theapplemuseum.com/index.php?id=56
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The NeXT Years: Steve Jobs before His Triumphant Return to Apple. Low End Mac: Worth It!. Retrieved June 19, 2010, from http://lowendmac.com/orchard/06/steve-jobs-next-years.html
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Top 3 Best-Selling Desktop Computers (As of August 2009). (n.d.). EzineArticles Submission - Submit Your Best Quality Original Articles For Massive Exposure, Ezine Publishers Get 25 Free Article Reprints. Retrieved June 30, 2010, from http://ezinearticles.com/?Top-3-Best-Selling-Desktop-Computers-(As-of-August-2009)&id=2759987

Latest revision as of 21:47, 1 July 2010

Wiki Entry #1: Charles Babbage's Difference Engine

The Difference Engine is not likely to come to mind when thinking about the origin of computers. Charles Babbage, professor of mathematics at Cambridge University and developer of the Difference Engine, realized that all mathematical equations did not have to be done by hand, and that there had to be a faster way to arrive at a solution (Modern History). Babbage never constructed a working prototype of the Difference Engine, yet his ideas contributed to the development of the field of computing machines. The Difference Engine has an intriguing history, and even though it never actually materialized, the progressive ideas of its developer, Charles Babbage, made an important impact on the history of computing.

The early 19th century ushered in a time of unprecedented advancements in a wide range of fields. In the shadow of advancements in engineering, communication, transportation, and many other fields, lie mathematics. During this time, “Engineers, architects, mathematicians, astronomers, bankers, actuaries, journeymen, insurance brokers, statisticians, navigators - anyone with a need for calculation - relied on printed numerical tables for anything more than trivial calculations” (Babbage Engine). This being noted, printed numerical tables often had flaws because they were calculated by hand, and humans are inherently fallible. Babbage became frustrated by encountering these mistakes on printed numerical tables, and in 1821 exclaimed to his friend, “I wish to God these calculations had been executed by steam” (Babbage Engine). It was at this point in Babbage’s life that he set out to create a calculation machine that would eliminate human error. This was Babbage’s intention, but it would never be fully realized with a working prototype.

Charles Babbage’s first machine, the Difference Engine No. 1, “was designed to automatically calculate and tabulate mathematical functions called polynomials which have powerful general applications in mathematics and engineering” (Babbage Engine). Babbage worked on constructing this project with engineer Joseph Clement. Plans for this first machine detailed an enormous structure weighing nearly fifteen tons. In 1833, construction was stopped because Babbage argued with Clement about moving the workshop closer to his house (Babbage Engine). This first attempt to construct a calculation machine almost bankrupted Babbage, if it were not for the scrap value of the unused parts.

In 1834, Babbage devised plans for an even more advanced machine called the Analytical Engine, a programmable computing machine. This project was way ahead of Babbage’s time. His ideas surpassed the level of engineering and mechanics available to him at the time, therefore, an actual working prototype was never built.

It was not until 1837 that Babbage used the mechanisms involved in the Analytical Engine to start working on the Difference Engine No. 2. This new design would require three times less parts than the Difference Engine No. 1, weigh five tons and measure eleven feet long by seven feet high (Babbage Engine). Babbage never attempted to build this machine because it was again impossible with the mechanics available to him at the time.

The number one reason why Babbage failed to construct a working prototype of his calculation machine can be attributed to his ideas not aligning with the level of engineering and mechanics available at the time. Babbage had all the necessary ideas and plans to accomplish his objective, he just did not have the tools to bring his ideas to fruition. According to the Computer History Museum, “Babbage was a prickly character, highly principled, easily offended and given to virulent public criticism of those he took to be his enemies. Runaway costs, high precision, a disastrous dispute with his engineer, fitful financing, political instability, accusations of personal vendettas, delays, failing credibility and the cultural divide between pure and applied science, were all factors” (Babbage Engine). All of these factors, combined with Babbage’s ideas being so far ahead of his time, are the reasons why he is not widely recognized in the development of computing machines.

Overall, Charles Babbage may not be credited with it, but his ideas for a computing machine that would eliminate human error laid the foundation for the development of computing machines. For his time, the idea of the Difference Engine may not have been that practical, but in years to come its benefit would have been realized. Over 150 years later, “in 1990, Babbage's Difference Engine No. 2 was finally built from Babbage's designs and is also on display at the London Science Museum” (Modern History). Babbage inspired people to think about computing mathematical equations in a way that eliminated the human error found in basic hand calculated tables. This inspiration moved engineers closer toward actually creating computing machines.


References

The Babbage Engine | Computer History Museum. (n.d.). Computer History Museum. Retrieved May 27, 2010, from http://www.computerhistory.org/babbage/

The Modern History of Computing (Stanford Encyclopedia of Philosophy). Stanford Encyclopedia of Philosophy. Retrieved May 30, 2010, from http://plato.stanford.edu/entries/computing-history/

Wiki Entry #2: Bill Gates

William H. Gates III is undoubtedly one of the most famous men in the history of computers. He is more commonly known as Bill Gates, chairman of the Microsoft Corporation. As Bill Gates’ name has become synonymous with the computer industry, one might wonder how he arrived at this auspicious position. Gates’ fascination with computers can be traced all the way back to his adolescence.

Bill Gates was born on October 28th, 1955 in Seattle, Washington (Microsoft Corporation). Gates became interested in programming at a young age. He was lucky enough to attend Seattle’s Lakeside School, which is a highly exclusive private school (Encyclopedia of World Biography). It was at this school that Gates would meet his lifelong friend and future business partner, Paul Allen. Some of Gates early experiences with computers included, “debugging (eliminating errors from) programs for the Computer Center Corporation's PDP-10, helping to computerize electric power grids for the Bonneville Power Administration, and founding with Allen a firm called Traf-O-Data while still in high school” (Encyclopedia of World Biography).

After Gates graduated from Seattle’s Lakeside School, he went on to further his education at Harvard University. This is where Gates “teamed up with Paul [Allen] to write a new version of Basic programming language for the first personnel computer the Altair 8800” (Investing Value). Gates made the decision to leave Harvard, during his junior year, to pursue his dream of creating a world-class computer technology corporation. Ironically, thirty years later, in 2007, Harvard University presented Gates with an honorary law degree after his commencement address (Engadget).

In 1975, Bill Gates and Paul Allen launched Microsoft. With the foresight of believing that “the computer would be a valuable tool on every office desktop and in every home, they began developing software for personal computers” (Microsoft Corporation). Microsoft would serve as the catalyst for the idea of every household owning a personal computer becoming reality.

During the beginning years of Microsoft, Gates and Allen actually wrote programs for the early Apple and Commodore machines (Encyclopedia of World Biography). The two men worked as a productive team and were very crafty with their business negotiations. This was evidenced when, “Bill Gates talked IBM into letting Microsoft retain the licensing rights to MS-DOS, an operating system that IBM needed for their new personal computer” (Inventors).

It was only a few years later that Microsoft burst on to the global scene. In November of 1983, “Microsoft Corporation formally announced Microsoft Windows, a next-generation operating system” (Inventors). It was actually two years later that the final product was released. The next five years involved Microsoft perfecting Windows 1.0 and releasing a new version called Windows 2.0. After this, Microsoft began releasing a new version of Windows every few years. In 1990, Microsoft released “a new version of Windows called Windows 3.0 with a much improved GUI and features which sold more than 10 million copies, quickly followed by Windows 3.1, 3.11 and workgroups which added networking support. Building on their success Microsoft developed Windows 95 followed by windows 98, 2000, Millennium Edition and … Windows XP” (Investing Value). Windows 7, the newest version, was released in the fall of 2009.

Bill Gates is more than just an incredibly successful businessman, he is also an incredibly generous philanthropist. This generosity was put into effect when Bill Gates and his wife, Melinda, “endowed the Bill & Melinda Gates Foundation with more than $28.8 billion (as of January 2005) to support philanthropic initiatives in the areas of global health and learning” (Inventors). In addition, some of his recent pledges include, “$1 billion over twenty years to fund college scholarships for about one thousand minority students; $750 million over five years to help launch the Global Fund for Children's Vaccines; $50 million to help the World Health Organization's efforts to eradicate polio, a crippling disease that usually attacks children; and $3 million to help prevent the spread of acquired immune deficiency syndrome (AIDS; an incurable disease that destroys the body's immune system) among young people in South Africa” (Encyclopedia of World Biography).

When one considers the history of computers, Bill Gates is certainly one of the first names that comes to mind. Without his pioneering efforts, it is hard to say whether computer programming would be as advanced as it is today. It was Bill Gates’ fascination with programming that advanced computers from the Altair 8800, which had to be manually assembled, to the recent edition of Windows 7, which can be downloaded in minutes to any personal computer.


References

Bellis, M. (n.d.). Bill Gates - Biography and History of the Microsoft Chairman. Inventors. Retrieved June 9, 2010, from http://inventors.about.com/od/gstartinventors/a/Bill_Gates.htm

Bill Gates Biography. (n.d.). Investing Value - Business and Investment Portal. Retrieved June 9, 2010, from http://www.investingvalue.com/investment-leaders/bill-gates/index.htm

Bill Gates Biography - life, family, childhood, children, parents, name, story, history, wife, school, young, son, information, born, college, marriage, time, year, achievements, sister. (n.d.). Encyclopedia of World Biography. Retrieved June 9, 2010, from http://www.notablebiographies.com/Fi-Gi/Gates-Bill.html

Executive: Bill Gates. (n.d.). Microsoft Corporation. Retrieved June 9, 2010, from http://www.microsoft.com/presspass/exec/billg/bio.mspx

Miller, P. (n.d.). Bill Gates gets Harvard degree, not at all smug about it -- Engadget. Engadget. Retrieved June 11, 2010, from http://www.engadget.com/2007/06/08/bill-gates-gets-harvard-degree-not-at-all-smug-about-it/

Wiki Entry #3: Netscape

When considering web browsers, Netscape would not be the first name that comes to mind. That is because, although Netscape was one of the premier browsers, over the years it has lost its prominent position in the browser industry. At the end of 2006, the usage share of Netscape had fallen, from over 90% in the mid 1990s, to less than 5% (Using Internet). Netscape’s market share rose and fell in relation to the introduction of the technological advancements of the browser.

In 1994, Silicon Graphics founder Jim Clark collaborated with Marc Andreessen to establish Mosaic Communications, which would later be renamed Netscape Communications (Browser History). These two men recognized the potential for web browsing software, and wanted to introduce it outside of the academic circle where it originated. Netscape became an instant success. The company was creating and innovating at a speed much faster than any competitor of the time. Netscape released many new browser features, and integrated three internet technologies in one application, web, email, and newsgroups (Netscape History). Netscape also made its browser accessible on the three major computer types of the time, Windows, Macintosh, and Unix. The public began to use Netscape more and more because of the relative ease of controlling it, and because it was the most advanced browser of the time. Netscape also incorporated new features, including: cookies, frames, and JavaScript in future versions (Best Web).

Microsoft witnessed the success Netscape had with its browser and they quickly joined in the competition for this new market. Thus began the first browser wars. When Windows 95 was launched, Microsoft challenged Netscape with a web browser of its own, Internet Explorer. For many years, Internet Explorer remained in the shadow of Netscape, always trying to catch up with their new technologies. This competition helped advance browser technology, because fierce competition is the impetus for the creation of new and improved versions of a product.

Internet Explorer did have one distinct advantage over Netscape; it could be downloaded free of charge. Even with Netscape charging its customers for access, it still held on to its market share for the next couple years. These next couple years proved to be a very productive period for both browsers’ companies. Each company was constantly releasing betas and final versions to the public to challenge the competition.

Slowly, the gap between Netscape and Internet Explorer began to shrink. Once the fourth generation of browsers was released, Netscape was finally matched and then quickly surpassed technologically by Internet Explorer. In January 1998, Netscape announced that its browser could now be downloaded free of charge, a desperate move to stay in competition with Internet Explorer. As the decade came to an end, Internet Explorer had captured most of Netscape’s market share.

In November 1998, while under great pressure from Microsoft and their Internet Explorer, Netscape was sold to America Online. Netscape eventually lost almost its entire market share, and was no longer a threat to any competitor. Nine years later, in November 2007, Internet Explorer had 77.4% of the browser market, Firefox 16%, and Netscape 0.6% (Switch). Near the end of 2007, America Online announced that it would stop the development of the Netscape browser, putting an end to Netscape’s short lived success in the browser market.


References

1994, t. e. (n.d.). Netscape History - Web Browser, Marc Andreessen, Jim Clark, Mosaic. The Internet. Retrieved June 22, 2010, from http://www.livinginternet.com/w/wi_netscape.htm

Browser History: Netscape. (n.d.). Bloo's Home Page. Retrieved June 22, 2010, from http://www.blooberry.com/indexdot/history/netscape.htm

Lavieri Jr., Edward D. Using Internet Browsers to Safely Access Information and Services on the World Wide Web. June 2006. Retrieved June 22, 2010

Switch, t. &. (n.d.). AOL Kills Netscape's Future, Leaves Firefox To Battle IE -- Browser Wars -- InformationWeek. InformationWeek | Business Technology News, Reviews and Blogs. Retrieved June 22, 2010, from http://www.informationweek.com/news/internet/webdev/showArticle.jhtml?articleID=205204433

The History of Netscape Navigator. (n.d.). Best Web Hosting | Website Hosting Reviews and Ratings 2010. Retrieved June 22, 2010, from http://www.webhostingreport.com/learn/netscape-navigator.html


Wiki Article: How Apple Regained its Market Share

Abstract

The objective of this research paper was to discover how Apple Inc. regained its market share in the computer industry after being headed toward failure at one point during the early 1990s. Steve Jobs, co-founder of Apple, was the driving force behind Apple’s success, but he left the company in 1985 following a dispute over business decisions. Apple’s subsequent problems were the result of mismanagement by a string of inept chief executive officers and poor business decisions regarding the licensing of Apple technologies to outside firms. Stock prices plummeted and Apple sustained a dramatic loss of market share. If it had not been for the return of Steve Jobs to the helm of Apple in 1997, the company may have failed. Steve Jobs’ return brought back strong leadership and the launch of many innovative products. First he stopped the licensing agreement that gave rise to Apple clones. Then he stopped production on 15 of the company’s 19 products, so the focus could be placed on desktop and portable Macintoshes and product innovation. Under Steve Jobs' strong leadership, Apple launched the many innovative and highly popular products it is so well known for today. With the release of iMacs, iPods, iPhones and other Apple products, the company has regained its market share and become remarkably successful once again.

Apple Inc. is a very popular and financially successful corporation, with many well known products in the consumer electronics, computer software, and personal computer market. However, this has not always been the case. Apple has had a roller coaster history, which makes it unique in the computer industry. One may ask how this Fortune 500 Company, which was at one point headed toward failure, regained its market share. Apple Inc. may have failed if it had not been for the return of co-founder Steve Jobs in the late 1990s, which brought back strong leadership and the launch of many innovative products.

Established over 30 years ago, in 1976, Apple started out as a small company to distribute the Apple I personal computer kit. Founded by three young men, Steve Jobs, Steve Wozniak, and Ronald Wayne, Apple entered the emerging personal computer market. The Apple I would not be considered a personal computer by today’s standards, instead it had to be assembled by consumers, which were most likely computer hobbyists. Over the next few years, Apple developed improved versions of the Apple I in order to compete with Commodore and Tandy, the two other major personal computer companies of the time. Steve Jobs wanted to transform Apple into a large company, so he approached Mike Markkula, a former electronics engineer who had managed marketing for Intel Corporation and Fairchild Semiconductor. Apple benefited largely from this consultation because, “Markkula bought one-third of the company for $250,000, helped Jobs with the business plan, and in 1977 hired Mike Scott as president” (Apple Computer).

The Apple II was released in 1977, and it was the product that distinguished Apple from its competitors. Unlike the TRS-800 and Commodore PET, the Apple II came with color graphics, an open architecture, and storage on a 5 ¼ inch floppy disk drive and interface, the Disk II (Apple Inc). With Apple becoming one of the fastest growing companies in the United States, the next step was to go public. By going public, Apple would be able to expand, becoming an even bigger threat to competitors. In 1980, Apple went public, and within a year, the stock value increased by 1700% (Apple Museum).

Three years later, in 1980, the Apple III was released. This release hurt the company in many ways. The Apple III did not receive sufficient testing before its release, and it turned out to be a defective product. Production of the unit was halted, the problems were remedied, but sales never compared to those of the Apple II. In April 1984, Apple decided to discontinue the product. President, Mike Scott, began to lay off employees after the failure of the Apple III. Steve Jobs did not agree with this decision. This discord resulted in Mike Markkula becoming president, Steve Jobs chairman, and Mike Scott resigning as president and leaving the company (Apple Museum). Despite this difficulty, Apple persevered. An especially notable event for Apple occurred in December 1982, when “Apple became the first personal computer company to reach $1 billion in annual sales” (Apple Computer).

The following year, IBM surpassed Apple as Europe’s main supplier of personal computers. Apple tried to compete with IBM by releasing the Apple Lisa computer, which was the first commercial computer with a graphical user interface or point and click system with a mouse. The Lisa turned out to be a flop for Apple, not reaching projected sales due to its very expensive price of $10,000 (Apple Lisa). The stock prices suffered greatly at this time, falling to $35, half the 1982 sale price (Apple Computer). Jobs tried to rectify the situation by hiring the former president of Pepsi-Cola, John Sculley, to replace Mike Markkula as president.

The next product to be released by Apple was the Macintosh. This personal computer also had a user friendly graphical user interface like the Lisa, but it was priced more reasonably at $2,495 (Original Macintosh). The Macintosh had problems though, with insufficient memory and other system issues. In the first 100 days, Apple sold nearly 70,000 Macintosh computers, but the follow up sales were not the same (Apple Computer). Following this decline in sales, Apple also experienced major internal problems. Steve Jobs no longer supported Sculley’s business decisions and planned to remove him. Sculley found out about Job’s plan and stripped him of all his operational responsibilities, leaving him with no power in any decision making (Apple Museum).

Shortly thereafter, Steve Jobs resigned from Apple. He was the key innovator of the company and without him, the Apple Corporation suffered. Jobs went on to form another computer company, NeXT Incorporated. In October 1985, Sculley made one of the worst decisions for Apple's future. He signed a “contract with Microsoft that would eventually change the computer industry forever and make Microsoft the greatest competition for Apple. The contract granted Microsoft permission to use some Mac GUI (Graphical User Interface) technologies if Microsoft continued producing software for the Mac (Word, Excel). In return, Microsoft agreed to continue developing Word and Excel for Macintosh. Based on this contract, Apple loses all lawsuits over copyright infringements against Microsoft in the following years” (Apple Museum). This was Apple’s lowest point in history. Stocks plummeted to their absolute lowest price (AAPL).

Apple was plagued by inept management during the 1990s, as a string of different chief executive officers made poor business decisions and stocks plummeted. In 1993, Sculley was removed from his position. His successor, Michael Spindler, “broke tradition by licensing Apple technology to outside firms, paving the way for ill-fated Apple clones that ultimately eroded Apple’s profits” (Apple Computer). In 1996, even under the new leadership of Apple chief executive officer, Gil Amelio, the company suffered financially. Apple’s trouble grew as its losses reached “$816 million in 1996 and a staggering $1 billion in 1997. The company’ stock, which had traded at more than $70 per share in 1991, fell to $14 per share. Its market share, 16 percent in the late 1980s, stood at less than four percent” (Apple Computer).

For ten years Steve Jobs operated NeXT Inc., and Apple continued to suffer. The idea of returning to Apple lingered in Jobs’ mind. In 1995, Jobs actually approached Apple’s newest board-member at the time, Gil Amelio, and declared, “There's only one person who can rally the Apple troops, only one person who can straighten out the company” (NeXT). Steve Jobs was speaking of himself. Jobs still had his ties with NeXT; so being the shrewd businessman that he was, Jobs focused on a merger deal between NeXT and Apple. It was not until December 2, 1996 that Gil Amelio announced, “that Apple would buy NeXT for the price of $427 million and would base the next version of the Mac OS on NeXTstep” (NeXT). After this deal was announced, Steve Jobs returned to Apple to serve as an advisor and help with the merger. It had been eleven years since Jobs left Apple. Finally, in September 1997, two months after Amelio’s exit, Apple’s board of directors named Steve Jobs as interim chief executive officer (Apple Computer). Steve Jobs was back, and Apple’s recovery was set in motion.

Now that Steve Jobs was back, the focus at Apple returned to product innovation. Jobs realized the poor shape that Apple was in, and he was determined to bring the company back to power. First he stopped the licensing agreement that gave rise to Apple clones. Then he stopped production on 15 of the company’s 19 products, including printers, scanners, and other peripherals. The focus of Apple was now placed on desktop and portable Macintoshes (Apple Computer). By eliminating products, Jobs assembled teams that could focus solely on product innovation and improving the Macintosh. Jobs reorganized the company and its leadership. In this process, Jobs also “closed plants, laid off thousands of workers, and sold stock to rival Microsoft Corporation, receiving a cash infusion of $150 million in exchange” (Apple Computer).

In August 1998, under Steve Jobs' leadership, Apple released a product that had great impact on the computer industry, the iMac. Ten months earlier, Jobs was determined to create a computer for Apple that was affordable, so he tapped all available resources. The iMac originally sold for $1299 (iMac G3), almost half the price of previous personal computers sold by Apple. The iMac was affordable for many more people now, thus revolutionizing the personal computer industry. This computer did not have a separate monitor, a rat’s nest of power cords, or any external drives. The iMac became the fastest selling personal computer in history (Apple Museum). Due to Steve Jobs’ restorative efforts, Apple left the 1990s as a smaller version of its former self, but more importantly, a profitable company once again. Figures prove, “annual sales, which totaled $11.5 billion in 1995, stood at $5.9 billion in 1998, from which the company recorded a profit of $309 million. In 1999, sales grew a modest 3.2 percent, but the newfound health of the company was evident in a 94 percent gain in net income, as Apple's profits swelled to $601 million” (Apple Computer). Apple was on the road to reinvention, and this was just the beginning.

The iMac design team was lead by Jonathan Ive, who would eventually design the iPod and iPhone. Jobs brought back innovation to Apple, and he knew who to place where to get the best outcome from his talented workforce. He also knew what consumers wanted and he directed the focus toward developing technological advances to meet consumer demands. In 1998, Apple purchased Macromedia’s Final Cut software, signaling its expansion into the digital video editing market (PostScript). The purchase of this software resulted in the development of iMovie for consumers and Final Cut Pro for professionals. Through the purchase of more software, Apple was able to finalize iLife. iLife consists of: iPhoto, iMovie, iDVD, GarageBand, and iWeb. These applications are unique in the computer industry because they can only be accessed on Apple computers. This venture was a great marketing strategy because Jobs knew that perking consumer interest in applications that could only be accessed on Apple computers would result in an increase in Apple computer sales.

Over the years, the iMac has become more advanced with each new generation. Since 1998, the iMac has had seven new generations, each one being remarkably different than the previous generation. The original iMac had a 15 inch display and a memory ranging from 4GB to 60GB. Today’s iMac Aluminum has a display ranging from 20 to 27 inches of LCD and a memory ranging from 250GB to 2TB (Apple iMac). These are quite impressive improvements to have occurred in a relatively short period of time. What makes the iMac stand out from other desktop computers is how it lacks a separate system unit containing the memory, CPU, power supply and other parts. This makes the iMac computer one of a kind. Under Steve Jobs' leadership, release of the iMac computer, over ten years ago, helped Apple to regain its strong position in the computer industry. Two Apple products, the iMac and the Apple Mac Mini were among the top three best-selling computers in 2009 (Top 3).

Since Steve Jobs’ return to Apple, the company's products have become sleek, hip and very popular with consumers. One of the most popular devices created by Apple is the iPod. Since its creation in 2001, iPod sales have increased nearly 15 fold with total iPods sold measuring at nearly 160 million after the second fiscal quarter of 2008 (Apple iPod). The iPod has gone through a complete metamorphosis in nine years, from the original iPod to the present day iPod Touch. Over the past nine years, Apple has released over 15 different models, including: iPod classic, iPod with touch wheel, iPod mini, iPod shuffle, iPod photo, iPod with color display, iPod nano, and the iPod Touch. Each of these iPod models has multiple generations, each with improvements and increased storage capacity. The marketing strategy of having new generations of the iPod being released several times a year ensures that there will always be a steady stream of consumers who desire to own the latest and greatest version of the iPod. If a consumer has been a fan of the iPod since its introduction, it is very likely that he or she has purchased multiple generations of the product. The iPod is so popular with consumers that it has even been integrated into car audio systems. Figures show that, “more than 70 percent of 2007 model year cars offer iPod integration” (Apple iPod). That number is likely even higher for 2010 model year cars. With the availability of iPod integration in most car models, automobile companies are obviously aware that a vast number of Americans own an iPod. The iPod dominates the market for personal music players. There are numerous brands of MP3 music players that attempt to rival the iPod, but none have sales figures that even closely resemble those of the Apple iPod.

Another very successful Apple innovation, developed with Steve Jobs at the helm, is the iTunes Store. This online downloadable music store has made Apple Inc. millions of dollars. The store sells individual songs for download at 99 cents per song. In addition to songs, the iTunes Store also sells downloadable movies, television shows, applications for the iPod/iTouch, podcasts, and audiobooks. The iTunes Store does not dominate the market for legal downloadable music, but it does bring in huge profits for Apple. Even with the existence of illegal downloading, Apple’s iTunes Store has helped boost their profits dramatically. It had been reported that from the launch of the iTunes Store on April 28, 2003, up to April 1, 2007, 2.5 billion songs had been sold (Macsimum). Being able to sell 2.5 billion songs in 4 years is a remarkable achievement, and it helped Apple become a major distributor in the music sharing industry.

Another Apple innovation that is very popular and very profitable is the iPhone. The iPhone was developed after Steve Jobs directed his engineers to look into touch-screens. At the time, Jobs was contemplating development of a touch-screen personal computer. The iPhone was released in the United States, on June 29, 2007, and it could be purchased at Apple Stores and AT&T Stores. Since the release of the iPhone 2G, there has been development of the iPhone 3G, iPhone 3GS, and the iPhone 4G, released the third week of June, 2010. Again, Apple profits from a brilliant marketing strategy based on the consumers’ desire to own the latest gadget. The iPhone is a versatile device that can be used to make a phone call, watch a movie, or send an email, all by the touch of a screen. AT&T was lucky enough to be the only cell phone provider for the iPhone, making their sales climb just as significantly as Apple’s. Surprisingly, there has been talk about the iPhone being developed for Verizon and being introduced within the next year (Ross). If this happens, the iPhone has the chance of becoming the most widely sold cell phone in history. Another victory for the company Steve Jobs brought back to life.

Apple’s image today consists of it being a very successful company with innovative products that consumers desire to own. This is a complete turnaround from the image it had in the early 1990s, as a company on the brink of failure with inept management. It was the return of co-founder Steve Jobs, in the late 1990s, that turned Apple around, returning it to profitability and regaining its market share. Under his strong leadership, Apple launched the many innovative and highly popular products it is so well known for today. He reorganized the company and narrowed its focus. Steve Jobs was the driving force behind Apple’s phenomenal return to success. One can only image what the future holds for this incredible company under the leadership of this incredible man.


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