Steve Jobs and the NeXT Big Thing
Contemporaneous account of the NeXT failure.
Summary
This is the second catalogue entry for Randall Stross's 1993 account of NeXT, the company Steve Jobs founded after leaving Apple, listed elsewhere in this reference under a variant title.
Stross covers NeXT from the 1985 founding through the abandonment of the hardware business. The company built an expensive workstation aimed at higher education, priced it above what the market would pay, constructed an automated factory ahead of demand, made component decisions including an optical drive and the omission of a floppy drive that customers rejected, and shipped years behind schedule. It raised very large sums from Ross Perot and Canon and sold a small fraction of projected volume.
The book was written before the sequel. NeXTSTEP, the operating system, was acquired by Apple in 1996, became the basis of Mac OS X and iOS, and brought Jobs back to Apple. The hardware failure the book documents produced the software asset that turned out to matter.
Stross wrote without cooperation and the treatment of Jobs is critical throughout, presenting the decisions as products of unchecked founder conviction. That assessment was made at the low point of Jobs' career and did not survive the following decade, which readers should hold in mind. As a case study in a well-capitalised company executing the wrong product competently, it remains useful.
Key takeaways 7
- NeXT's workstation was priced above what its target education market would pay, which product quality could not compensate for.
- An automated factory built ahead of demand converted variable costs into fixed ones before any volume existed to absorb them.
- Large capital raises allowed wrong decisions to persist for years by delaying the feedback that would have corrected them.
- Component decisions made on the founder's judgement rather than on customer evidence, including the optical drive and the absent floppy, were rejected by buyers.
- Shipping years late means competing against a different generation of machines than the product was designed against.
- The operating system rather than the hardware was the company's real asset, which was not apparent until Apple acquired it.
- The book's critical judgement of Jobs was made at the low point of his career and did not survive the decade that followed.
Who should read it
Founders and investors studying well-funded product failure, noting this duplicates the other NeXT entry in this reference.
About Randall E. Stross
Business historian and journalist, longtime professor at San Jose State University; wrote reported histories of Edison, Microsoft, Google and Y Combinator.
Each book reports one organisation from inside over a defined stretch of time: a year among Y Combinator's batch companies, Benchmark's partners through the dot-com IPO wave, Edison's Menlo Park laboratory. The result records how venture firms and inventors actually spent their days, which reads as evidence rather than retrospective summary.
Who recommended it 2 · 1 direct
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Where it sits in the reference 3
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