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Next, Jobs May Provide Keys to Reversing Apple's Tumble

Technology: Computer maker will have new operating system and industry giant as it takes on Microsoft.

December 24, 1996|JULIE PITTA | TIMES STAFF WRITER

CUPERTINO, Calif. — In the wake of Apple Computer Inc.'s stunning acquisition of Next Software Inc., software executives expressed cautious optimism Monday that the return of Apple co-founder Steven P. Jobs and new technology from Next would pull the struggling personal computer maker out of its current slump.

The Next acquisition brings to a conclusion Apple's exhaustive search for a new operating system, the brains of a personal computer, to replace its outdated Macintosh OS. But because Next's software was designed to run with a system other than a Macintosh, Apple's first challenge may be retaining its cadre of independent software developers.

While most have never created products for Next, they expressed admiration for its technology.

"It sounds like a solid move," said Gordon Eubanks, chief executive of Symantec Corp., a Cupertino neighbor of Apple's and a longtime developer of Macintosh software.

"The Next operating system is 10 years ahead of the Macintosh, and they get Steve. Steve is the kind of guy that when he's on, he's really on, and he can make a big difference at a company."

Eubanks was joined by Adobe Systems Inc., the company that invented desktop publishing on Apple's Macintosh, and Sun Microsystems Inc., which markets the Java Internet language, in applauding Apple's move to Next.

Even PC software giant Microsoft Corp., Apple's rival as well as the biggest seller of Macintosh applications, expressed support.

"This is exciting," said Microsoft spokesman Collins Hemingway. "We look forward to hearing the technical details and until then we can't say much more. We have been a premier developer for the Macintosh, and we look forward to continuing that support."

Late Friday's surprise announcement of the Next purchase raised nearly as many questions as it answered regarding Apple's plans for the future. Next's operating system was originally created for Motorola Inc.'s 68000 microprocessor. Although it has been rewritten for Intel's popular Pentium computers, Next has never adapted its operating system to the PowerPC, the engine for today's Macintosh.

Apple Chief Technology Officer Ellen Hancock said the new operating system--scheduled for completion at the end of 1997--would be able to run on Power Macintoshes selling today, but the company has yet to determine if it would be adapted to run on non-Power PC machines.

And most existing Macintosh applications--packaged word processing, spreadsheets and database programs--will be unable to run on the Next operating system until 1998, when coding that will allow it to read older software has been added.

By the time the new operating system is released, the stakes facing Apple will be high: PC software giant Microsoft Corp. will have a new release of Windows, the Macintosh look-alike that has eclipsed Apple in popularity.

Macintosh software developers have been subjected to a roller-coaster ride during Apple's volatile two decades of existence. Last year was particularly trying as Apple suffered product shortages and decided to halt work on Copland, the five-year overhaul of the Macintosh operating system.

Among Gil Amelio's first moves as chairman and chief executive this year was to warn software developers that Copland would be indefinitely delayed. By July, Apple had pulled the plug on Copland.

"The thing we were looking for from Apple is 'just tell us what your future is,' " said Bob Roblin, senior vice president of marketing for Adobe.

As Apple launched its search for a Copland replacement, longtime software developers remained remarkably loyal to the company. Now they seem relieved at the decision.

"Next is real technology," Eubanks said. "It's a shipping product unlike some of the other things they were thinking about."

Apple's Chief Financial Officer Fred Anderson said Monday that the company will write off $300 million of the cost of acquiring Next in March, in its second fiscal quarter. The remaining $100 million will be amortized over several years, he said.

Apple stock closed down 25 cents at $23.25 in Nasdaq trading Monday.

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