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You are here: MacNN Forums > News > Mac News > This Week in Apple History: April 9 through 15

This Week in Apple History: April 9 through 15
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Apr 11, 2016, 02:13 PM
Quite a bit happened with Apple during the week of April 9 through 15m in the years 1976 to 2016. Yet with some irony, it is the forgotten third partner who, for this one week, looms very large. Ronald G. Wayne co-founded Apple with Steve Jobs and Steve Wozniak, then confounded everyone by bailing out 12 days later.

They had filed the original paperwork forming Apple Computer on April 1, 1976 so his leaving would be on April 12 or 13. It's oddly not precisely clear: he repeatedly just says it was 12 days after the signing. Whichever date it was, he says he took himself off down to the courthouse to have his name removed from the papers.

To see why he did that, and why he was even in this position, though, take a step back -- to when Steve Jobs was working at Atari a couple of years before. Wayne was a draftsman there, and may have been the first person Jobs knew who had ever started his own company. That had been a slot machine games one, and it failed, hence his working for Atari -- but that he started one impressed Jobs enough that he proposed working together. Jobs wanted to design and market his own arcade slot machine with Wayne, but the draftsman said no.

Ronald Wayne was 21 years older than Jobs, and he had that failed business behind him, so his experience was that slot machine businesses were just a fast way to lose a lot of money. Still, Jobs continued to talk with him, and when the idea for Apple was forming, it was Wayne that Jobs turned to for help persuading Steve Wozniak to join.

At the time, Woz was working for Hewlett Packard, and like many US corporations, especially like many computer firms, there was a sense at HP of being a company man. You were HP through and through, and Woz was deeply ingrained in that culture. So the idea of giving it all up to go work with Steve Jobs wasn't appealing -- until Ron Wayne talked to him.

Ronald G Wayne (photo courtesy BBC)
Ronald G Wayne (photo courtesy BBC)

Wayne talked with Woz about the issues for a couple of hours, and you're thinking he persuaded him to quit HP, but he didn't. What he did instead was show Woz how he could do both. What was crucial, though, was that Woz's new designs be officially owned by this new Apple company, not by Wozniak himself. Woz was used to owning his work, and was presumably getting used to HP not wanting his designs.

"Woz had a parental attitude toward the circuits he developed, and he wanted to be able to use them in other applications, or let HP use them," Wayne says in Walter Isaacson's biography of Steve Jobs. "Jobs and I realized that these circuits would be the core of Apple. We spent two hours in a roundtable discussion at my apartment, and I was able to get Woz to accept this."

Wayne had convinced Woz where Jobs could not, and it was decided that having him on board would prevent or at least ease any similar stalemates in the future. So that April 1, 1976 contract lists the three men as founders, and gives Ron Wayne 10 percent of the nascent company. Neither Woz's 45 percent, nor Jobs', would be enough to make things happen unless they agreed, or one of them persuaded Wayne. It was a good plan -- for about 12 days.

Even in those 12 days, however, you can argue that the future Wayne would've had at Apple was already sealed. The contract that the three of them signed was written and typed by Wayne and, sure enough, he was going to be responsible for documentation. He's said since that he could see 20 years of documentation ahead of him, and that is one reason he left. Hear more of his side of the tale in a half-hour interview from NextShark:

The main one, though, was money. Although Wozniak was working for HP at the time, as Wayne tells it, neither Woz nor Jobs had any money. Whereas Wayne had a house, car and salary. So if Apple failed, and creditors came calling, he was the one who would be landed with the debt. Days after forming Apple, Jobs got the order for 50 computers, and with it the need to borrow $5,000 cash and get a $15,000 line of credit with suppliers. Wayne had a very good point.

Only, there is a way to look at money as being a defining element of Ronald Wayne's life. In recounting this period at Apple, Isaacson said that "Jobs and Wozniak had no personal assets, but Wayne (who worried about a global financial Armageddon) kept gold coins hidden in his mattress."

Much later, in 2010, Wayne wrote a very corporate-speak book called Insolence of Office: Socio-Politics, Socio-Economics and the American Republic, which is a wordy collection of thoughts about many things, including money. It's a hard and meandering read, where the issue of money feels like it's an undertow instead of the main topic, but it's what he keeps returning to when promoting the book.

"My book Insolence of Office is the result of 40 years of research. We've had a 2,500 percent increase in inflation since the end of World War II. The $2,300 -- $800 and then later, another $1,500 -- I received from Apple in 1976 would be roughly the same as $9,200 today. I'm sure you would agree with me that's not bad pay for only 12 days worth of work. However, that increase of inflation is something I predicted decades ago, and the driving factors behind that inflation is something I discuss in great detail in my book."

That's from his own Facebook page about the book, and it's a fair point. However, he keeps making and re-making the same point about inflation, and then builds to something that just isn't correct. "To counter much that has been written in the press about me as of late, I didn't lose out on billions of dollars. That's a long stretch between 1976 and 2012. Apple went through a lot of hard times, and many thought Apple would simply go out of business at various times in its maturity. I perhaps lost tens of millions of dollars."

No. An original, undiluted 10 percent share of Apple today is worth billions. Wayne is just wrong there, and it's fascinating to see how regularly he writes and opines about money issues such as inflation, when all his worry about financial Armageddon hasn't happened to anyone but him. He had sensible reasons to walk away from Apple, but there was little reason he didn't think of those before joining. He worried himself out of Apple, and while you can post-rationalize that, it's harder to justify how he later sold his contract for $500, only to see it be re-sold for $1.6 million.

"In that, you have the story of my life," he told Cult of Mac. It's a moment of self-perception, self-awareness for a man who palpably worries about money, but has always lost it. Where Apple made millionaires, Wayne is reportedly living on social security. That's disputable, as some sources list him as having a business worth of $300,000 -- but instead of luxury, he's living in the unincorporated town of Pahrump, Nevada. It's a town of around 36,000 people, situated between Las Vegas and Death Valley National Park.

It's only this looping back over the issue of money that makes us doubt when he says he doesn't regret his decision to leave Apple. As we say, he had good reasons at the time, and you can't predict the future. Plus, he stayed friendly with Jobs and Wozniak, later being flown out to a Mac presentation in 2000 to see what the company was doing, and meet with his ex-colleagues.

Only there is one more fact about Ronald G Wayne, co-founder of the world's most successful company: he does not own any Apple products.

Woz does

Steve Wozniak does own Apple products. Many Apple products. He doesn't always like them, but he owns a lot, and he talks about them. Around a year after Wayne left Apple, Woz and Jobs were preparing to take the Apple II to the very first West Coast Computer Faire, which would be held on April 16, 1977. As busy as he was with getting the Apple II done, Woz took a lot of time to also do this.

It's an entirely fake ad for a fictional Zaltair computer, which mocked the kind of hyped-up advertising that even the lowliest computer was getting then. "Imagine a dream machine," it begins. "Imagine the computer surprise of the century." It goes on. This is the front page, though there is a lesser-known continuation that includes a comparison chart pitching the Zaltair against other computers, including Apple's.

Reportedly Steve Jobs fell for it, and was only relieved to see that Apple came out fine on the comparison chart. Eight years later, on February 24, 1985, Woz gave Jobs a framed version of the ad for his 30th birthday. That was the first time Jobs learned it was a joke.

This wasn't meant to be a joke

Flash forward a bit to April 12, 1991. Jobs, Wozniak, and Wayne have all gone now, and Apple's CEO is John Sculley. On this date, he gave IBM a demonstration of Pink, the code-name for Apple's next operating system.

They bought it, in every sense. IBM was convinced this was the future for Apple, and it invested money in forming what was to be named Taligent before, long story short, dying a death. In the early 1990s, though, this was a collaboration that could have saved Apple, and there are those who say it was John Sculley's last, best move at Apple.

We're concentrating on this week from 1976 to 2016, but sometime in 1992, following the apparent success of the Taligent deal, Sculley told Apple's board that we would leave the next year. It would've been around this week, in April 1993, as that marked his 10th anniversary at the company. The board asked his advice about what to do next, and he told them to sell Apple, so they had a very good go, and they asked him to stay on until the company was sold.

He thought AT&T or Kodak would be a good buyer, but seemingly those companies didn't agree -- and by now Apple's fortunes were nosediving. In 1992, Apple's earnings peaked at $4.33 per share, and in 1992 they were $0.73. It was a bad time, and it was going to get worse.

-- William Gallagher (@WGallagher)
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Apr 11, 2016, 05:00 PM
Funny that Wayne lives in Pahrump, NV. I know a guy who lives there now, and he had a sort of opposite version of the same story in that he inherited a bit of land in a fortunate location that his family held onto instead of selling, and has as a result been exceptionally lucrative.

Not, you know, 10% of the most valuable corporation on earth lucrative, but still better than most of us could hope for.
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