Jobs Announces New Board, Microsoft Partnership

by: Todd Stauffer ([email protected])

Announcing sweeping new changes to Apple Computer, Inc.'s board of directors and a new partnership with Microsoft Corp., Steve Jobs, CEO of Pixar, also unveiled Apple's new slogan at his keynote address in Boston: "Think Different."

"What I see is the makings of a very healthy company with some extrodinarily talented people...who need to come together, get a great plan and execute it," Jobs said.

The keynote may be more significant for what Jobs didn't say, however. Although he will join Apple's board of directors, Jobs said no chairman will be announced until a CEO is also named. There was also no mention of Mac OS licensing, Rhapsody, an investment by Oracle CEO Larry Ellison, network computers or a solid date for a return to profitability.

What was announced was a nearly-new board of directors. The six member board now comprises:

  • Ed Woolard, Chairman and former CEO of Dupont
  • Gareth Chang, President of Hughes International
  • Larry Ellison, CEO of Oracle
  • Jerry York, former CFO of IBM and Chrysler
  • Bill Campbell, CEO if Intuit, former head of Claris Corp.
  • Steve Jobs

"We're adding a tremendous amount of expertise," Jobs said.

Jobs focused on renewed commitment in Apple's strongest markets, which he defined as Creative Content and Education. Saying often that Apple is the world's biggest education company, he pointed to statistics showing that 60% of computers in schools are Apple computers and 64% of teachers' computers are Apples. He also called for increased co-marketing in the content creation market, citing the lack of a strong marketing relationship between Apple and Adobe, makers of Adobe PhotoShop. Jobs noted that 10-15% of Macs are bought specifically for PhotoShop.

The only specific announcement, however, was a new partnership with Microsoft. The terms of that agreement:

  • Perpetual cross-licensing for existing patents
  • Microsoft Office on Mac for at least five years, with the same amount of major releases as the Windows version of Office
  • Internet Explorer is the default browser for the Mac OS
  • Microsoft and Apple will collaborate on Java compatibility for the Mac OS
  • Microsoft invests $150 million in non-voting shares of Apple stock, promising not to sell for at least 3 years

The agreement brings into question the exact nature of some of the swaps, including the fate of Quicktime on Macintosh, but specifics weren't available. The deal was punctuated by a satellite appearance by Bill Gates, CEO of Microsoft.

"Some of the best work I've done in my career has been with [Jobs] on the Macintosh," Gates said. "It's been very exciting to renew our commitment to the Macintosh." Gates announced that "Mac Office 98" will appear by the end of this year or the beginning of next, and will sport elements that are "in many ways...more advanced than what we've done on the Windows platform."

Finally, Jobs energized Apple's commitment to the Mac OS, saying "the Mac OS is still the best in the world," and pointing to a $1.5 billion software industry that revolves around the Mac OS.

"At the core, Apple is about the Mac OS. We're going to invest a lot more in it," Jobs said.

Applause and cheers reached their height when Jobs announced that Mac OS 8, after only two weeks of shipping, has already sold 1.2 million copies.

"This number is going shows no signs of abating," Jobs said.