Originally created 12/21/96

He's back? Apple may rehire Steve Jobs

SAN JOSE, Calif. (AP) - Apple Computer Inc. co-founder Steve Jobs, who oversaw the creation of its Macintosh before his bitter ouster more than a decade ago, may return to help revitalize the Mac's aging software.

In what would be a remarkable reunion, the company reportedly plans to hire Jobs as a part-time consultant and pay a nominal fee for the operating system developed by Next Software Inc. - the company Jobs founded after leaving Apple.

Apple was expected to announce its renewed ties with Jobs on Friday, the Los Angeles Times reported, citing unnamed sources. Calls to Apple's Cupertino, Calif., headquarters were not immediately returned, and a Next spokeswoman declined comment.

But industry sources told The Associated Press that if an Apple-Next deal is completed, Apple is likely to combine Next's software program with the core of an operating system Apple had been developing for the Mac. Apple's efforts to develop a replacement for its aging Mac operating system fizzled earlier this year.

An Apple-Next deal, if signed, means that Next beat Be Inc. and Sun Microsystems Inc. for the job of helping Apple develop a new operating system, the program that controls the Macintosh's basic functions. Apple was negotiating with all three companies.

Be, previously believed to be Apple's first choice, lost the deal because its chief executive, former Apple head technologist Jean-Louis Gassee, demanded a price Apple rejected as too high.

Reaction to a possible deal seemed mixed as investors sorted out the impact on Apple. Apple stock, down in early trading, was up 62« cents to $22.87« in late afternoon trading on the Nasdaq Stock market.

Industry analysts reacted cautiously but said that a deal with Next - even if it's Apple's second choice - makes sense for Apple, the nation's third-largest maker of personal computers.

"The logic of it is certainly there - both in terms of the technology Next offers and, I'm guessing, the economic terms," said Robert G. Herwick, president of Herwick Capital Management in San Francisco.

Next's software, used in high-end business computers, is admired for its "object orientation" - technology that helps developers write new software quickly and simply.

It also is good at "multitasking" - running several different functions at once - and is highly unlikely to crash. All those are qualities Macintosh users have long wanted.

Jobs, the Times said, will be hired as a part-time consultant and technology "guru" in charge of rebuilding Mac's aging operating software. The Macintosh personal computer in recent years has lost significant market share as PCs using Microsoft Corp.'s Windows OS largely eroded its traditional ease-of-use advantage.

An alliance would be an extraordinary - and ironic - reunion between Apple and the man responsible for the original Macintosh. Jobs co-founded Apple in 1976 but left nine years later after losing a power struggle when then-chief executive officer John Sculley.

Jobs then founded Next Computer Co. in Redwood City, Calif. But the company's sleek black workstation computers never caught on, and in 1993, Next got out of the hardware business and concentrated on software. It officially changed its name in January to Next Software.

"If this is true ... Jobs has come full circle," said Tim Bajarin, president of Creative Strategies Research International in San Jose.

"When he went to start Next, in his view he was going to create the next great computer with both hardware and software. Of course, his hardware vision failed miserably, but he always had faith in his underlying operating system," Bajarin said.

"You could now argue he is putting his system back into the Apple world and in essence creating the next great OS."

Users are not likely to see any big difference in the "look and feel" of Mac computers running on a Mac-Next software system. However, a new system is expected to run much faster than current models and crash far less often.

Mac users will not be immediately affected by any Apple decision about the operating system because analysts and software developers expect that it will take at least a year to develop.

But Eric Lewis, an analyst with International Data Corp. in Mountain View, Calif., pointed out that Apple will need to make sure that current Macintosh applications work with the new OS. That will be a tricky task, given the great technical differences between the Mac and Next operating systems.

Despite the challenges, Apple is betting that a state-of-the-art operating system that outperforms Windows will encourage more software developers to write hot new applications for its computers. That would, the company hopes, not only keep Mac fans loyal but attract new users.

"Apple must once again position itself as the `computer for the rest of us,"' said Frank Chiachiere, a computer science student at the University of Pennsylvania, quoting an old Mac advertising slogan.

"Apple needs to emerge once again as having a powerful product that's easy to use, friendly, and, most of all fun," he said.


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