As if Steve Jobs and Apple haven't commanded enough headlines during the past couple of weeks. Late Friday, Bloomberg reported that Jobs is considering a liver transplant.
In a telephone interview with Bloomberg's Connie Guglielmo, Jobs refused to comment on his health status: "Why don't you guys leave me alone--why is this important?"
The article, which quotes anonymous sources said to be "monitoring his illness," says that Jobs is weighing the transplant "as a result of complications after treatment for pancreatic cancer in 2004."
A spokesman for Apple said the company had no comment on the report.
On Wednesday, Jobs announced he was stepping aside for a six-month medical leave of absence. The mystery over his drastic weight loss has fed all sorts of speculation about what's ailing him. In an e-mail to Apple employees, Jobs wrote the following:
"...during the past week I have learned that my health-related issues are more complex than I originally thought. In order to take myself out of the limelight and focus on my health, and to allow everyone at Apple to focus on delivering extraordinary products, I have decided to take a medical leave of absence until the end of June."
"I have asked Tim Cook to be responsible for Apple's day to day operations, and I know he and the rest of the executive management team will do a great job. As CEO, I plan to remain involved in major strategic decisions while I am out. Our board of directors fully supports this plan."
Jobs, who is the closest to what is a rock star in the tech industry, wants his private life to be private. And like other celebrities, he would prefer that people stop obsessing about his health or other aspects of his private life. But it goes with the territory.
Celebrity obsession is a part of the culture-just check to see what the most popular search terms are on Google or watch Entertainment Tonight.
Still, it's understandable that Jobs wants to be left alone to deal with his medical problems. I sympathize. He doesn't have to say anything to anyone. But Apple Inc. might as well be "Jobs Inc." to many people. As the head of a company that is almost synonymous with this name, he unfortunately has some disclosure obligations.
Dan Farber contributed to this report
If you're an Apple shareholder or employee, the good news is that Steve Jobs' health is not in any immediate danger.
Or so we're supposed to surmise from the cryptic note issued by Jobs early Monday on the state of his health--and the even more cryptic note put out by his employer.
At the unveiling of new MacBooks in October, Steve Jobs tersely addressed concerns about his health: "That's all we'll talk about with Steve's health today. Want to see (his blood pressure) higher? Just ask him more questions."
(Credit: James Martin/CNET News)Here's the relevant text from Jobs' statement Monday:
As many of you know, I have been losing weight throughout 2008. The reason has been a mystery to me and my doctors. A few weeks ago, I decided that getting to the root cause of this and reversing it needed to become my #1 priority.
Fortunately, after further testing, my doctors think they have found the cause--a hormone imbalance that has been "robbing" me of the proteins my body needs to be healthy. Sophisticated blood tests have confirmed this diagnosis.
The remedy for this nutritional problem is relatively simple and straightforward, and I've already begun treatment. But, just like I didn't lose this much weight and body mass in a week or a month, my doctors expect it will take me until late this Spring to regain it. I will continue as Apple's CEO during my recovery.
OK, it's great to know that he's not facing a cancer recurrence, as some had speculated. Jobs is a tech icon and the industry would be much the poorer were he to retire from the scene. But this latest PR stunt is going to raise new questions. Not about the exact nature of Jobs' ailment but about the parsimonious way Apple has communicated with the public about the health of its CEO.
Until now, the mantra was "Steve's health is a private matter, Steve is our CEO." The impression Apple wanted to leave was that everything's just fine at the helm. That shaded the truth--and I'm being charitable here. At this point, how can you trust the official chronology offered up by Jobs and Apple? Even with Monday's statements, I can't call it communication so much as stonewalling.
True to form, Apple won't care a fig what outsiders may think. "Just keep on buying and don't bother us with the rest of it." Talk about a reality distortion field.
See also:
• Steve Jobs discloses hormone imbalance
• Health concerns force Apple's Jobs from Macworld
• Apple's last Macworld beginning of new era
The health of Apple CEO Steve Jobs has been a topic of concern for some months now. On Monday, with the company's Macworld show getting under way, Apple and Jobs issued statements on Jobs' health. We'll be following this breaking story throughout the day.
In October, Steve Jobs briefly addressed his state of health onstage at an Apple event.
(Credit: James Martin/CNET News)
CUPERTINO, Calif. -- It is widely recognized both inside and outside of Apple that Steve Jobs is one of the most talented and effective CEOs in the world.As we have said before, if there ever comes a day when Steve wants to retire or for other reasons cannot continue to fulfill his duties as Apple's CEO, you will know it.
Apple is very lucky to have Steve as its leader and CEO, and he deserves our complete and unwavering support during his recuperation. He most certainly has that from Apple and its Board.
Here is a separate letter from Steve Jobs:
Dear Apple Community,For the first time in a decade, I'm getting to spend the holiday season with my family, rather than intensely preparing for a Macworld keynote.
Unfortunately, my decision to have Phil deliver the Macworld keynote set off another flurry of rumors about my health, with some even publishing stories of me on my deathbed.
I've decided to share something very personal with the Apple community so that we can all relax and enjoy the show tomorrow.
As many of you know, I have been losing weight throughout 2008. The reason has been a mystery to me and my doctors. A few weeks ago, I decided that getting to the root cause of this and reversing it needed to become my #1 priority.
Fortunately, after further testing, my doctors think they have found the cause -- a hormone imbalance that has been "robbing" me of the proteins my body needs to be healthy. Sophisticated blood tests have confirmed this diagnosis.
The remedy for this nutritional problem is relatively simple and straightforward, and I've already begun treatment. But, just like I didn't lose this much weight and body mass in a week or a month, my doctors expect it will take me until late this Spring to regain it. I will continue as Apple's CEO during my recovery.
I have given more than my all to Apple for the past 11 years now. I will be the first one to step up and tell our Board of Directors if I can no longer continue to fulfill my duties as Apple's CEO. I hope the Apple community will support me in my recovery and know that I will always put what is best for Apple first.
So now I've said more than I wanted to say, and all that I am going to say, about this.
Steve
See also:
• On eve of Macworld, Jobs talks health
• Now Apple's credibility really is in the balance
• Apple's last Macworld beginning of new era
Over the years, I've become inured to the rah-rah pumpathon that is CNBC. With the notable exception of the delightful curmudgeon Mark Haynes, the channel's anchors and correspondents dutifully perform their function as glorified cheerleaders for Wall Street.
But now CNBC's Silicon Valley bureau chief, Jim Goldman, can add to his impressive credentials the title of media apologist for both Apple and Steve Jobs
(Credit:
CNET News)
In a postearlier Wednesday, Goldman came out swinging against unnamed market "manipulators" responsible for punishing Apple stock, especially in the aftermath of Apple's abrupt announcement that Steve Jobs would not keynote January's Macworld. Taking his lead from MacDailyNews, which lamented that "there's only so much Apple shareholders can take," Goldman wants the Securities and Exchange Commission to impose an "uptick" rule ,which prevents you from just shorting with abandon and supposedly would slow down future bear raids against Apple.
"MacDailyNews cites a great comment from John McCain last September: 'The regulators were asleep, my friends, they were not working for you. (The SEC has allowed abusive short-selling to turn) our markets into a casino.' Great point. And consider that if Bernie Madoff clients can be killed by massive market manipulation, how can the little guy expect to compete on a level playing field?"
Bernie Madoff?
Goldman depicts MacDaily News as being "Apple-centric." That's understatement. The Fox News of Appledom is more like it. That MacDaily News would push for SEC intervention on Apple's behalf should surprise no one. But before descending on Chris Cox's office, let's consider how we arrived at this juncture.
More than any other CEO, Steve Jobs has become synonymous with his company. Is there a more accomplished executive in the contemporary business world? At the very least, Jobs deserves a place among the Top Three with Sam Walton and Warren Buffett.
I won't speculate on his health but Jobs is a pancreatic cancer survivor. Let's not pretend. So when Apple drops its PR bombshell less than a month before Macworld, you have to wonder what's behind that decision. Maybe he's burned out or maybe he's in the middle of writing the Great American Novel. Who knows? Apple has since imposed its famous cone of silence.
But with Apple shares getting shellacked on Wednesday as the rumors flew, Goldman was downright incensed how "any momentum Apple enjoys is quickly, electronically dashed by those betting against the company."
"The web lights up with concerns about Steve Jobs' health; whether he's dying; or will be incapacitated; or will be resigning or retiring. And shares get destroyed, no matter how fundamentally solid Apple might be...The fact is, posting "gaunt," or "frail," or "Steve Jobs is ill" is the financial equivalent of yelling fire in a crowded movie house. And if that kind of thing is going to be tolerated, government should step in and either investigate the manipulators, or bring back the Uptick Rule."
To be sure, Apple's stock has been the target of unsavory shorts from time to time, but you want to talk about market manipulation? Ask Goldman's colleague Jim (Booyah) Cramer. The guy's apparently an expert.
Fact is that Apple brought on this mess. After the June developers' conference, questions got raised about Jobs' appearance. The company said his health was a private matter. Some argued that the demands of corporate governance or greater transparency should require Apple to be more forthcoming. But that was the final word from corporate.
So now what to think about Jobs' mysterious withdrawal from Macworld?
This is not the way a company as PR savvy as Apple usually rolls out the news. We don't know whether Jobs is feeling punk or whether he was dumped in a power struggle. That makes it a rumor monger's field. No surprise there. In blaming dark forces for spreading rumor and innuendo for financial gain, Goldman misses the bigger point. Apple could have avoided all of this by opening up. Instead, its communications with the outside world continue to assume the contours of a raised middle finger.
Finishing off his column for Wednesday's edition of The New York Times, Tom Friedman offers a novel suggestion:
Somebody ought to call Steve Jobs, who doesn't need to be bribed to do innovation, and ask him if he'd like to do national service and run a car company for a year. I'd bet it wouldn't take him much longer than that to come up with the GM iCar.
No, it's not a GM
(Credit: Tesla Motors)Friedman obviously doesn't expect General Motors to act on the idea (although Jobs did simultaneously manage both Apple and Pixar for nearly a decade). His larger point, I think, was to contrast the mindsets that prevail in Silicon Valley and Detroit. And as the political powers try to grapple with the fate of GM and the U.S. auto industry, they must be wishing there was a way to perform a gene graft.
In his piece, Friedman approvingly cites a column in The Wall Street Journal by Paul Ingrassia, who used to run that paper's Detroit bureau. It deserves quotation in length:
"In return for any direct government aid," he wrote, "the board and the management (of GM) should go. Shareholders should lose their paltry remaining equity. And a government-appointed receiver--someone hard-nosed and nonpolitical--should have broad power to revamp GM with a viable business plan and return it to a private operation as soon as possible. That will mean tearing up existing contracts with unions, dealers and suppliers, closing some operations and selling others and downsizing the company...Giving GM a blank check--which the company and the United Auto Workers union badly want, and which Washington will be tempted to grant--would be an enormous mistake."
So on and so forth. But as important as all this is, these are process questions to get GM through the near term. However, the salvation--not just for GM but the entire American auto industry--depends upon the sort of innovation that has helped the technology business thrive through several economic cycles.
Without putting Jobs on a special pedestal, he embodies a textbook example of how creativity can rescue a near-moribund operation. After Jobs returned to Apple in 1997, he did not hesitate to pull the plug on dead-end projects like the Newton, or ruffle feathers by cutting off the Mac clone makers. At the same time, he infused Apple with a design aesthetic that manifested itself in the development of products such as the iMac, the Mac OSX, the iPod, and the iPhone. None of this was preordained; it was the result of innovative thinking and fast execution.
Now contrast Apple's experience with that of GM. That company let itself get addicted to churning out hulking gas guzzlers because that's where the easy money came from. Energy was relatively cheap and management's thinking was that "green" was the purview of left-wing pansies who ran San Francisco. (GM Vice Chairman Bob Lutz, who is on record dismissing the potential of hybrid autos, also was quoted saying that global warming was "a total crock of [expletive deleted].")
I don't want to get into the debate over global warming today, but Lutz and the rest of GM's management was unprepared when energy prices spiked and consumer demand shifted abruptly. Is it any surprise, then, to learn that more forward-looking approaches to the auto industry's future have come courtesy of some old tech names like Shai Agassi and Elon Musk.
A former SAP exec, Agassi is attempting to build out an electric car network. Musk, a serial entrepreneur best known as a co-founder of PayPal, now oversees a start-up developing a line of luxury electric cars. (Unfortunately for Tesla, the market meltdown forced it to fire about one-fourth of its full-time workers and delay production of one of its models.) It's hard to know whether Agassi or Musk will be able to make it. If they fail, though, it won't be due to lack of imagination.
Imagination. That's what built the auto industry in the first place. So why can't history repeat itself. Maybe a Jobs, a John Chambers, or a Sergey Brin can help offer an answer. Too bad they won't get the opportunity.
Maybe it's our particular infatuation with Apple and its mercurial co-founder, or maybe it's simply a by-product of the times we live in, where seemingly nothing is out of bounds for public discussion. Whatever the reason, I surely can't be the only person reacting to the "Is Steve having a cancer relapse" rumor with a fix of frustration and disgust.
(Credit:
James Martin/CNET News.com)
Truth be told, I did wonder whether Jobs had suffered a relapse when I saw his interview with CNBC yesterday. He looked thin, even gaunt. But last time I checked, neither Apple nor its CEO had issued a health alert.
Unfortunately for Apple, people remember that the company's board failed to immediately disclose Jobs' original cancer diagnosis. (Fortune Magazine reported that the board held onto the news for nine months before disclosing it to shareholders.) So now the rumor mill is churning out speculation aplenty--just in case.
Yesterday, Valleywag speculated about Jobs' health and this morning Henry Blodget is running his mouth.
"Many readers will consider this post inappropriate," Blodget began. He should have taken that advice to heart and stopped right there.
Sideline diagnoses aren't worth much, and I don't buy this nonsense that the public has any special rights here. If Jobs no longer can carry out the function of a CEO, he should turn over the reins to a successor. Until then, it's a private matter for Jobs and his family.
Enough already. It's beyond bad form.
I once asked Steve Jobs why Apple was so indifferent toward corporate customers. At the time, big companies were in the beginning stages of one of their periodic PC upgrade cycles, leaving Dell virtually alone to clean up.
So, didn't it make sense to more aggressively pursue that business? Jobs froze me with one of those looks.
Steve Jobs: Consumers rule but how seriously is he thinking about Corporate America?
(Credit: Dan Farber/CNET News.com)That's not an interesting market, he said. Next question.
Silly me.
Of course, Jobs was entirely right. IT has since become a predictably cyclical business, while the real sizzle in tech turned out to be in the consumer space. Besides, Apple's been able to win over increasing numbers of corporate converts without doing much--let alone paying for an expensive sales force to knock on corporate America's doors. (Last year, its enterprise share grew threefold to 4.2 percent, according to Forrester. However, the uptake was largely confined to enthusiasts and small work groups.)
Jobs' pursuit of the consumer assumed that computers would become media terminals in millions of homes. Not overnight, but over the course of years. It was a wise hunch. In the early part of the decade, the computer industry was at a point where home networking technologies were still limited and consumers were only then starting to move video content from Internet-connected devices to televisions in sizable numbers.
Now we're witnessing a interesting confluence of events. Apple's plying its consumer expertise to take the iPhone into the corporate marketplace. At the same time, Research in Motion is adopting the opposite tack with its product line. (RIM is reportedly working on an iPhone killer although details are still sketchy.
Just as Jobs has been deliberate about the business market, Research in Motion's co-CEO Jim Balsillie is taking his time targeting consumers. The indirect hints about RIM coming after Apple make for tantalizing speculation. But the real spadework is taking place on RIM's flank, where Balsillie is deepening the company's alliances with enterprise partners. That's why he's at the Sapphire conference in Orlando, Fla., this week, talking up a deal to run SAP's CRM application natively. Larry Dignan at our sister site ZDNet literally ran into Balsillie at the conference, where he pressed him about what's next:
Balsillie said one path would be to expand into adjacent SAP applications for direct store delivery, salesforce automation, and human resources. Another path would be to go after analytics and embedded business intelligence. Balsillie said he's leaning toward the latter, but noted that "it's just my opinion" and he would have to consult with developers, product managers and other key people inside RIM and SAP.
That network of relationships with enterprise vendors will come in handy if RIM decides to more directly confront Apple. When Jobs gives his WWDC keynote in early June, he is expected to unveil new iPhone models. Maybe he'll also have more to say about any new friends he's made in the corporate world.
Times change and who knows? He may have concluded that it's become a more "interesting" business.
Was Steve Jobs trying to send an unofficial message to Adobe Systems? Something on the order of "get it in gear, guys, if you want to stay on my VIP list"?
As my colleague Tom Krazit reported Tuesday afternoon, Jobs used the Apple shareholders' meeting to publicly dismiss the the full-blown PC Flash version as "too slow to be useful" on the iPhone. He then went on to describe the mobile version--Flash Lite--as "not capable of being used with the Web."
That's an unusual--albeit refreshingly frank--way to talk in public about a business partner. Give Jobs credit for speaking his mind, although I very much doubt Adobe appreciated his candor.
I tried to get a comment from Adobe, which has worked closely with Apple over the years. Will Flash be supported on the iPhone or not? Here's the official non-response, response to my query:
""Flash and Flash Lite are a huge success. All major handset manufacturers worldwide license Flash today delivering a broad range of mobile devices ranging from feature phones to smartphones and consumer electronic devices. With more than 450 million Flash-enabled mobile devices shipped worldwide and 150 percent year-over-year growth we are on track to see 1 billion Flash enabled devices by 2010. Consumers demand a rich Web experience on any device and platform and Flash delivers just that. We look forward to our continued relationship with industry leaders to deliver engaging experiences to consumers worldwide."
Thin gruel. Hopefully, I can get a fuller answer later on.
Steve Jobs: What, me worry?
Browsing the headlines on Yahoo Finance this morning was enough to make anyone briefly consider jumping out the window. To wit:
• Job worries sink consumer confidence
• S&P: U.S. home prices down sharply
• U.S. home foreclosures soar in January
• Harsh light shines on iPhone, iPod sales
So here's the multiple choice test: Which headline does not fit with the rest? If you chose letter "D" you win a dream date with my colleague Michael Kanellos (No worries: Kanellos is off reporting on start-ups in Ireland this week, and so you're safe.)
I have to confess that the depth of emotion punctuating the "whither Apple" debate never ceases to baffle me. Throughout its history, Apple has always received more than its fair share of scrutiny. The commentary has usually been marked by extremes, pro and con, between the bulls and bears. That just went with the territory. And now a new element has been injected into the debate over Apple's prospects: recession. On Monday, my ZDNET colleague, Larry Dignan, wrote eloqently about Apple: the angst versus the reality. And he's right in many respects.
What with home foreclosures on the rise, crude oil prices breaking record highs, and the banking industry in its deepest crisis since the S&L mess of the early 1990s, there's enough to worry even the most Panglossian optimist in the crowd. And so in the last couple of months, Apple shares have plummeted from the $200 level late last year to under $120.
Which side has it right? Based upon the current stock price, you have to go with the bears--at least until the free fall ends. The gist of their argument is as follows:
• Apple doesn't have any upside surprises coming off one of its biggest product cycles.
• Sales of iPhones are said to be coming up short of expectations, while the number of people unlocking the devices is higher than anticipated.
• There are increasing signs of iPod saturation.
• With the economy worsening, why assume strong demand for (relatively) expensive Apple electronics products will continue?
Eric Savitz from Barrons has a good synopsis of the current concerns being articulated by analysts at Bernstein Research, J.P. Morgan, and Morgan Stanley.
The problem I have with the bears is that they've been wrong for much of the last three years. Everyone knows that the iPod is maturing. That's yesterday's news. In fact, Piper Jaffrey analyst Gene Munster believes the debut of the iPod touch signals the start of more Internet- and Wi-Fi-connected iPods in the future. If he's right, that may well turn out to be a game changer.
On the iPhone front, we'll have to wait for Apple to disclose the latest numbers during its next earnings call. But the same worry warts bemoaning the rise in so-called unlocked iPhones remind me of the sturm und drang surrounding the early days of the iPod. It took a couple of years but Apple had a major hit on its hands by 2003. I'd be floored if the iPhone did not repeat that pattern.
iPod unit growth rates
(Credit: PiperJaffrey)The problem I have with the bulls (maybe "perma-bulls is the better term?) is that they turn insane when the subject is Apple. These folks would ordain Steve Jobs dictator for life. Nothing he touches is unworthy of hushed reverence. And woe to the infidel reporter who dares breathe a syllable of criticism--the Mac mujahadeen make no allowance for the 4th Estate (or the First, Second and Third, either.)
So here's where I think we're heading.
Apple is not immune to what's going on in the rest of the world. If the U.S. economy goes into the dumper, some prospective buyers will defer their purchases until a sunnier day. But that's old news by now. The iPhone remains head-and-shoulders above any smartphone in the industry. Everyone knows the product is a long-term play. When my wife, perhaps the most nontechnical human on the planet, told me last month she wanted one, it spoke volumes to me.
Don't lump in Macintosh customers with regular PC shoppers. These folks have always been ready to pay a premium because they believed the Mac offered special value. Save the fight about whether they're right for another day. What's important to recognize is that they groove on Apple. Recession or no recession.
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