“Apple” without Jobs?

SOUR ON APPLE?

Loss of co-founder a long-term blow, one analyst says; another has faith in chosen successor

By Rachel Metz and Jordan Robertson ASSOCIATED PRESS

SAN FRANCISCO — With Steve Jobs bowing out as CEO, Apple Inc. must persuade investors and consumers that it doesn’t need the man who was the force behind the iMac, iPod, iPhone and iPad to be in charge to keep the technology hits coming.

Tim Cook, his hand-picked successor, has handled the top job repeatedly in the absence of the ailing Jobs, who resigned as chief executive on Wednesday and was elected chairman of Apple’s board. Although not nearly as recognizable as Jobs, Cook had been running Apple since January. The company’s stock rose 62 percent when Cook was in charge in the first half of 2009, and it has gained 7 percent since Jobs announced his most-recent leave.

Yesterday, Apple’s stock fell two-thirds of a percent, to $373.72, while the major indexes fell more than 1.5 percent.    Jeff Gamet, managing editor of the Apple-focused website The Mac Observer, said Jobs’ departure has more sentimental than practical significance. Gamet said that Jobs has been telegraphing the change for several years.    “All Apple really has done is made official what they’ve been doing administratively for a while now, which is Tim runs the show, and Steve gets to do his part to make sure the products come out to meet the Apple standard,” Gamet said.

But Trip Chowdhry, an analyst with Global Equities Research, said Jobs’ maniacal attention to detail is what has set Apple apart. He said Apple’s product pipeline might be secure for a few years, but he predicted that the company will eventually struggle to come up with market-changing ideas.    “Apple is Steve Jobs, Steve Jobs is Apple, and Steve Jobs is innovation,” Chowdhry said. “You can teach people how to be operationally efficient, you can hire consultants to tell you how to do that, but God creates innovation. … Apple without Steve Jobs is nothing.”

Jobs’ resignation appears to be the result of an unspecified medical condition for which he took a leave from his post in January.    In a letter addressed to Apple’s board and the “Apple community,” Jobs said he “always said if there ever came a day when I could no longer meet my duties and expectations as Apple’s CEO, I would be the first to let you know. Unfortunately, that day has come.”

Jobs’ health has long been a concern for Apple investors, who see him as an oracle of technology. He had previously survived pancreatic cancer and received a liver transplant.    The company said that Jobs gave the board his resignation on Wednesday and suggested that Cook, Apple’s chief operating officer, be named the new leader. Apple also said that Cook is joining its board.

Genentech Inc. Chairman Art Levinson, in a statement issued on behalf of Apple’s board, said Jobs’ “extraordinary vision and leadership saved Apple and guided it to its position as the world’s most innovative and valuable technology company.”    Levinson said that Jobs will continue to provide “his unique insights, creativity and inspiration,” and that the board has “complete confidence” that Cook is the right person to replace him.    “Tim’s 13 years of service to Apple have been marked by outstanding performance, and he has demonstrated remarkable talent and sound judgment in everything he does,” Levinson said.

Earlier this month, Apple briefly became the most-valuable company in America, surpassing Exxon Mobil. At the close of stock trading yesterday, Apple’s value was $346.5 billion, just behind Exxon Mobil’s $349 billion.    Jobs’ hits seemed to grow bigger over the years: After the colorful   iMac computer and the now-ubiquitous   iPod, the iPhone redefined the category of smart-phones, and the iPad all but created the market for tablet computers.

Jobs’ aura seemed part of the attraction. On stage at trade shows and company events in his uniform of jeans, sneakers and black mock turtleneck, he’d entrance audiences with new devices, new colors and new software features, building up to a grand finale that he’d predictably preface by saying, “One more thing.”

Jobs, 56, shepherded Apple from a two-man startup to Silicon Valley darling when the Apple II, the first computer to really catch on with the public, sent IBM Corp. and others scrambling to get their own PCs to market.    After Apple suffered a slump in the mid-1980s, he was forced out of the company. He was CEO at NeXT, another computer company, and at Pixar, the computer-animation company that produced Toy Story on his watch, over the following 10 years.

Apple was foundering as he returned as an adviser in 1996 — a year in which it lost $900 million as PCs based on Microsoft Windows dominated the computer market. The company’s fortunes began to turn around with its first new product under Jobs’ direction, the iMac. The computer was launched in 1998, and about 2 million were sold in its first year.    Jobs eventually became interim CEO, then took the job permanently. Apple’s popularity grew in the U.S. throughout the 2000s as the ever-sleeker line of iPods introduced many lifelong Windows users to their first Apple gadget. Apple created another sensation in 2007 with the iPhone, the stark-looking but powerful smart-phone that quickly dominated the industry.

The iPad was introduced less than a year and a half ago, but Apple already has sold nearly 29 million units, inspiring many rivals in a tablet-computer market that scarcely existed before Apple stepped in.    There have been setbacks. Apple was swept up in a massive Securities and Exchange Commission inquiry into the backdating of stock options in the mid-2000s, a practice that artificially boosted the value of options grants. But Jobs and Apple emerged unscathed after two former executives took the fall and eventually settled with the SEC.

Steve Jobs’ health

The following timeline details reports about Apple co-founder Steve Jobs’ health since his cancer diagnosis in 2003. Jobs resigned on Wednesday and took the role of chairman, and Chief Operating Officer Tim Cook was named CEO to succeed him.

• October 2003: Jobs is diagnosed with cancer in his pancreas and tries to treat the illness by switching to a special diet to avoid surgery, according to Fortune magazine, citing people familiar with the matter. Apple decides not to tell investors after consulting lawyers, the magazine said.
• Aug. 1, 2004: Jobs, then 49, discloses the cancer for the first time, saying he had successful surgery to extract the tumor. Cook runs the company until Jobs returns to work in September.
• June 12, 2005: Jobs talks about his fight with cancer during a commencement speech at Stanford University. He says he was diagnosed about a year earlier and that doctors told him he wouldn’t live longer than six months. The cancer turned out to be treatable with surgery “and I’m fine now,” he says.
• June 9, 2008: Jobs, while introducing the iPhone 3G at Apple’s developers’ conference, appears thinner and frail. The company blames a “common bug.”
• July 21, 2008: Responding to concerns about Jobs’ appearance, Apple says he has no plans to leave the company and that his health is a private matter. Investors aren’t reassured, and the shares fall 10 percent.
• Sept. 9, 2008: Jobs, introducing new iPod media players at an event in San Francisco, still looks thin. “Reports of my death are greatly exaggerated,” he jokes.
• Dec. 16, 2008: Apple says Jobs won’t give his usual speech at the Macworld conference. Jobs had used the forum to introduce new products for 11 straight years.
• Jan. 5, 2009: Jobs says he has a hormone imbalance, causing him to lose weight. Jobs vows to remain CEO during treatment.
• Jan. 14, 2009: Jobs gives up day-to-day operations to Cook until June, saying his health problems are more complex than originally thought.
• June 23, 2009: Methodist University Hospital Transplant Institute in Memphis, Tenn., confirms in a statement that Jobs had a liver transplant and has “an excellent prognosis.”
• June 29, 2009: Apple announces Jobs’ return to work. At the time, Apple shares had risen 70 percent since Jan. 15.
• Jan. 17, 2011:   Jobs begins another medical leave, leaving Cook in charge.
• March 2, 2011:   Jobs, 56, emerges from medical leave to introduce a new version of the iPad tablet.
• April 11, 2011:   Simon & Schuster sets the publication date for Jobs’ biography for early 2012. Written by Walter Isaacson and initially titled iSteve: The Book of Jobs, the title is later changed to Steve Jobs and the publication date moved up to November. The publisher later says it will update the biography to include Jobs’ resignation.
• Aug. 24, 2011:  Jobs resigns as CEO of Apple, handing the reins to Cook and taking the title of chairman. “I have always said if there ever came a day when I could no longer meet my duties and expectations as Apple’s CEO, I would be the first to let you know,” Jobs says in a statement. “Unfortunately, that day has come.”

Source: Bloomberg News