Re: Netscape and Apple's Suicidal Mindset

Ernest Prabhakar (
Sat, 22 Aug 98 15:40:48 -0700

Speaking as part of the much-lamented marketing arm at Apple...

I'm not sure what either of those columnists are complaining =
about. However, I would say that Apple's problems were: a) =
engineering management, and b) tryng to solve the wrong =
engineering problems.

Engineering management issues are at the crux of why it took us =
several years to realize Copland was hopeless, and the shoddy =
quality of several hardware products. Some of the horror stories =
I've heard... Gil at least did a decent job of cleaning house =
before Steve got here, which helped.

However -- and you can call this marketing if you want -- there =
was also a lack of understanding how Apple could best create value =
for our customers. There did seem to be a distinct sense of =
"this is what we know we can build, so let's build that." One =
thing Steve does (relentlessly) is not accept engineering answers =
that don't jibe with his sense of where the market has to be. =
Hence, the murder of PowerExpress (high-end boxes) in favor iMacs. =
The death of Rhapsody in favor of Mac OS X. etc.

The truth, as usual, is somewhere in the middle. The real =
challenge of marketing, as Steve understands, is to know your =
customers needs better than they do, and give them what they want =
before they ask for it. You can miss that either by just =
building what you feel like, slavishly bowing to consumer demands, =
or trying to brainwash the public into accepting whatever you give =

I'm curious. Would anyone claim that Apple's recovery a) doesn't =
address whatever core problems were responsible for our earlier =
problems, or b) was not primarily driven by paying better =
attention to our customers. Neither iMac nor Mac OS X is =
fantastic new technology; it is old technology packaged in a far =
more useful or interesting fashion.

Ernie Prabhakar, Marketing Dude

Begin forwarded message:

X-The-Artist-Formally-Known-As: CobraBoy!
Date: Sat, 22 Aug 1998 08:19:49 -0700
From: Tim Byars <>
Subject: Netscape and Apple's Suicidal Mindset
X-UIDL: b819e6f0a13f3beb333835e1982d4146

(A follow up to the SJ Merc article)

by: Conrad Gempf

The San Jose Mercury is a widely respected source of news on =
and articles from its
online version frequently show up in online headline news =
summaries. In
the first week of August,
they ran a column which displays something of the troubles within =
computer industry. The
columnist, one Chris Nolan, was sympathetic to the idea that one =
Netscape's biggest problems
was its own employees. Specifically, some of those employees used =
to work
for Apple, and had
brought a dangerous mindset with them.

Nolan claims to have heard this analysis from a cross-section of =
--- both allies and
competitors of the company. There are some key folks near the top =
of the
Netscape corporate
hierarchy who used to be in the Apple corporate hierarchy and =
they have
allegedly brought with
them "the Apple mentality" which is running and ruining Netscape.

What is this lethal mindset? Let me quote from the article: "The =
belief in
the inevitable triumph of
engineering over every other part of the business, particularly
marketing." By "engineering," of
course, is meant more than than chips and transistors, for Apple
engineering has always been
marked by an emphasis on design as well as function.

Essentially, then, the problem with Netscape, and by implication, =
problem with Apple, is that
they believe that the way to get ahead is to build a better =
Naively, they persist in the idea
that the most important thing is to get the product right, and =
accounting and marketing will

That's just not the way our society works. In our culture, =
whatever you
do, you don't rise to the
top by being the best, but by attending to publicity. =46rom the =
industry to hardware stores,
you don't succeed by being better, but by having better =
publicity. And no
one knows that better
than Netscape's and Apple's competitors. Where a company like =
Apple uses
its resources to try and
build a better product, others know that it's easier and cheaper =
improve the public's perception of
a product than to improve the product itself. And if a product =
properly when released, if it
includes sound, networking and year 2000 compliance from the =
start, you
miss out on free
publicity when someone finds a way to add sound or networking or =
year 2000
fixes -- you miss
free publicity and lucrative upgrade charges.

There is a terrible confusion between judging a computer company =
judging its products. People
are always being told not to buy Apple because their profit line =
was low
or the marketshare (as
much a measure of the need to upgrade other machines as anything =
else) was
down. But surely it's
daft to base any decision on who to do business with solely by =
who derives the most
profit by doing business with us?! Bill Gates didn't get to the =
top of the
financial ladder by creating
or innovating. While Apple was busy creating machines like the =
eMate and
the 20th Anniversary
Mac, which won places in permanent displays in museums around the =
Bill was also dealing
with those museums: buying up the exclusive rights to electronic
redistribution of all their works
before anyone realized what that might be worth. He got to the =
top by
cutting deals (with the CP/M
people, with the IBM people, with the museum people, with you and =
me) that
benefited him more
than they benefited anyone else.

The *reason* that Apple and Netscape aren't winning may be their
simple-minded belief in
engineering, but it's going too far to say that that's the =
Clearly the problem is us and
our system. The problem is that we as a society seem unable to =
judge the
quality of products apart
from their marketing, and therefore penalize those who =
concentrate on
quality at the expense of
hype. That's not Netscape or Apple's failure -- it's ours.

Meanwhile, if your main goal is to make money investing in a =
company, choose the ones
that emphasize marketing over product. But if you want to buy a =
product to
*use* every day, think


who amongst us hasn't run a large billion dollar a year monopoly? ...Tom Whore

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