April 1, 1976, April Fools’ Day.
In an ordinary garage in the Los Angeles suburbs.
Two young men were assembling a strange machine. It looked like a typewriter connected to a crude circuit board covered with chips and wires.
“Okay,” one said, “let’s try it.”
He pressed a switch. Words appeared on the screen: HELLO WORLD.
“It works!” the other cheered.
This machine was called Apple I. These two young men were Steve Jobs and Steve Wozniak.
They had just founded a company called Apple.
Who Did Computers Belong To? #
In the 1970s, computers were expensive professional equipment.
A mainframe computer cost millions of dollars, requiring dedicated rooms and operators. Only universities, large companies, and government agencies had computers.
Ordinary people? Ordinary people couldn’t even touch computers.
But a group of hobbyists thought differently. They believed: Computers should belong to everyone.
In 1975, in Albuquerque, New Mexico, a group of enthusiasts formed the Homebrew Computer Club. They gathered to discuss how to build their own computers.
In the club was a man named Steve Wozniak, everyone called him “Woz.”
Woz: The Genius Engineer #
Wozniak was an electronics genius.
He had been fascinated by electronics since childhood. In middle school, he designed a calculator that won first prize at a science fair. He also played pranks—he once made a device that looked like a bomb, causing panic at school and getting detained overnight.
At the club, Woz saw a computer called the Altair 8800. This was the first computer for hobbyists, but the experience was terrible: no keyboard, no display, only a row of switches and LED lights. To input a program, you had to flip switches; to read output, you had to watch LED flashes.
Woz thought: Could I build a better computer? A computer ordinary people could use?
He began designing his own computer. His goals were:
- Have a keyboard for easy input
- Have video output, could connect to ordinary TV
- Use BASIC language, easy to program
- Cheap enough for hobbyists to afford
By the end of 1975, Woz completed the design. This was Apple I.
Jobs: The Business Genius #
Woz designed Apple I, but he had no business sense. He just wanted to share the design with club friends.
Then his friend Steve Jobs entered the picture.
Jobs and Woz were high school classmates. Jobs was 5 years younger than Woz, but they hit it off immediately. Jobs admired Woz’s technical talent; Woz admired Jobs’s vision and charisma.
When Jobs saw Apple I, he immediately realized: This wasn’t just a toy for hobbyists; this was a product that could be sold to the masses.
He convinced Woz to start a company together. Jobs sold his Volkswagen van, Woz sold his HP calculator, and they raised $1,300 as startup capital.
On April 1, 1976, Apple Computer was founded.
Apple I: From Garage to Market #
Apple I was a bare circuit board with no case, no power supply, no keyboard. Users had to buy these components separately and assemble them.
Even so, it was much better than the Altair: it had a keyboard interface, could connect to a TV as a display, and had a built-in BASIC interpreter.
Jobs took Apple I to local computer stores. Store owner Paul Terrell ordered 50 units at $500 each.
Jobs and Woz worked day and night in the garage, assembling these 50 machines. They borrowed parts from friends, bought materials on credit. Jobs’s sister and girlfriend helped with soldering and testing.
Finally, they delivered on time. Apple I was produced in about 200 units total, earning Apple its first pot of gold.
Apple II: The Product That Changed the World #
Apple I was just the beginning. Woz was already designing the next product: Apple II.
Apple II’s design goal was: Ready to use out of the box.
It had a plastic case, built-in keyboard, built-in power supply. Users only needed to connect a TV, plug in power, and start using.
More importantly, Woz designed color graphics display—this was the first personal computer that could display color graphics. He also designed expansion slots so users could add extra hardware.
In 1977, Apple II was released at $1,298.
It became one of the most successful personal computers in history. From 1977 to 1993, the Apple II series sold over 6 million units.
VisiCalc: The Killer App #
Apple II’s success owed much to one piece of software: VisiCalc.
VisiCalc was the world’s first spreadsheet software. Developed by Dan Bricklin and Bob Frankston, it was released on Apple II in 1979.
Before VisiCalc, accountants did spreadsheets with paper and pen. Changing one number meant recalculating the entire table.
VisiCalc automated all this. Enter a formula, change one number, and the entire table updates automatically.
For business users, this was revolutionary. An Apple II plus VisiCalc, worth $2,000, could replace an accountant earning $30,000 a year.
VisiCalc became Apple II’s “killer app,” driving Apple II’s adoption in the business world.
Apple’s Rise #
Apple II’s success made Apple the hottest company in Silicon Valley.
In 1980, Apple went public. This was the biggest IPO since Ford Motor went public in 1956. Apple’s market value reached $1.8 billion on the first day.
Steve Jobs was 25 years old, worth $217 million. Woz was worth $116 million.
But success also brought problems. The company grew rapidly, and Jobs was difficult to manage. His perfectionism and tough style conflicted with many executives.
In 1985, Jobs was fired from the company he founded.
That’s a story for later.
The Spread of Personal Computers #
Apple wasn’t the only company making personal computers.
In 1981, IBM introduced the IBM PC. IBM was a giant in the computer industry; its entry marked personal computers becoming mainstream products.
The IBM PC used Intel’s 8088 processor and Microsoft’s MS-DOS operating system. It adopted an open architecture, allowing other companies to make compatible machines. This led to an explosion in the “IBM compatible” market.
Compaq, Dell, HP, and other companies began making IBM compatibles, with prices dropping and performance increasing.
Personal computers went from garages to offices, from offices to homes.
By the 1990s, personal computers had become standard equipment. Every office had computers, and many homes had them too.
The Garage Spirit #
Apple’s story became a Silicon Valley legend.
Two young men, in a garage, with $1,300, founded a company that changed the world.
This story inspired countless entrepreneurs. Google, Amazon, HP… many great companies started in garages.
What does the garage spirit represent?
Believing in the impossible. When everyone said personal computers had no market, Jobs and Woz believed computers could belong to everyone.
Building with your own hands. Don’t wait for others to change the world; do it yourself.
Keeping it simple. Apple II’s design philosophy was “ready to use out of the box.” Good products should be simple and easy to use, not requiring specialized knowledge.
Next Step: Jobs’s Return #
After Jobs was fired, he founded NeXT and acquired Pixar Animation. Pixar made Toy Story and became an animation giant.
In 1997, Apple acquired NeXT, and Jobs returned.
Upon his return, Jobs would launch a series of products that changed the world: iMac, iPod, iPhone, iPad.
Tomorrow, we’ll discuss Jobs and Apple’s golden age.
Today’s Key Concepts #
Personal Computer (PC) A computer designed for individual users, small in size, low in price, easy to use. Personal computers began spreading in the late 1970s; Apple II and IBM PC were among the most successful early personal computers. Personal computers turned computers from professional equipment into consumer goods.
Killer App (Killer Application) A software so useful that users buy hardware just to use it. VisiCalc was Apple II’s killer app, driving Apple II’s adoption in the business world. Later examples include: Word/Excel drove Windows adoption, browsers drove Internet adoption.
Expansion Slot An interface on a computer motherboard that allows users to add extra hardware. Apple II’s expansion slot design allowed users to add memory, disk drives, printer interfaces, etc., greatly extending the machine’s functionality.
Discussion Questions #
- Jobs and Woz were a perfect partnership: one understood technology, one understood business. Why do you think this combination succeeded?
- Apple II’s success owed much to VisiCalc. Can you think of any “killer apps” today that drive hardware sales?
Tomorrow’s Preview: Jobs and Apple’s Golden Age—how did they redefine products again and again, from iMac to iPhone?