John Sculley Tells The Real Story of Steve Jobs' 'Firing'

If you believe John Sculley — as I do – Steve Jobs was on the wrong side of the battle that resulted in what many people believe was his 1985 ‘firing’ from the company he co-founded.

In a new interview, Sculley tells his side of the story, which fits with the previously known facts.

‘Steve was never actually fired from Apple, he was demoted from head of the Macintosh division,’ Sculley said during a recently-released December 2011 interview with David Greelish, computer historian and President of the Atlanta Historical Computing Society. The interview may be listened to or downloaded here.

Sculley expresses regret over how the incident — a boardroom battle between the two men over marketing strategy — developed into one of the defining moments in the history of the personal computer industry.

The May 24, 1985 demotion occurred because of a dispute with Jobs over Sculley’s plan to continue placing the Apple II ahead of Macintosh in Apple’s product lineup. Jobs would resign from Apple five months later.

According to Sculley, Jobs wanted to lower the price of the Macintosh, introduced in January, 1984, while continuing heavy advertising necessary to promote the new computer. Sculley believed heavily promoting Macintosh meant its price could not be lowered and also required sales of the aging Apple II computer to remain strong for as long as possible.

‘The reality was the (Mac) just wasn’t powerful enough… Steve became very discouraged (and) the excitement quickly wore off,’ Sculley said. ‘Steve and I started to have major disagreements.’

Sculley said he was brought to Apple in 1983 to keep the Apple II, introduced in 1977, alive long enough to support development and marketing of the Mac. At the time of the boardroom fight, Sculley believed Macintosh was not yet powerful enough to fulfill the user expectations Jobs was creating.

Sculley cited the failed launch of “Macintosh Office” a January, 1985 as an example of unrealistic demands Jobs created for the young Macintosh.

‘The Macintosh just wasn’t ready to do the things Steve wanted to do in publishing,’ Sculley said.

As for Jobs’ eventual demotion, Sculley said he did not then understand the entrepreneurial mindset, and wishes he had.

“I didn’t appreciate, coming out of corporate America… what it meant to a founder, the creator of the Macintosh, to be asked to step down from the very division that he created to lead the very product that he believed was going to change the world,” Sculley lamented.

“I wasn’t as sensitive as I wish I had been on that. On the other hand, there was no question in my mind, either then or later on, that we had no choice but to follow the business strategy which we did. It was to continue to focus on the Apple II until the (Macintosh) technology became powerful enough — which it later did in 1986 — when we could launch what (we called) Desktop Publishing, and it became wildly successful.”

“It was a question of timing as much as anything,” Sculley said.

That’s the story as Sculley tells it. It is absolutely true that:

• Jobs was demoted, not fired, and later resigned
• The original Mac (1984) fizzled
• Apple’s 1986 introduction of desktop publishing and more powerful hardware — which Jobs must have known about well before his fight with Sculley — would propel the Mac to greatness

I accept that, as a public company, Apple was expected to meet financial goals that only strong sales of the Apple II could support. Given that and what was known about Mac at the time, if I had been on Apple’s board at the fateful meeting, I’d have sided with Sculley.

My understanding is Jobs essentially boxed himself in, making the battle one of “him or me,” though I cannot confirm that. It is important to understand that the “genius” of Steve Jobs was not so widely recognized in 1985 and the Apple board had reason to be fed-up with him.

Nevertheless, I’d hoped to have been more sensitive and found a face-saving way for the mercurial Jobs to be taken out of corporate management while still guiding Macintosh to its eventual success.

Jobs, given the demotion, was right to leave.

On the upside, it is interesting to image how the world might have turned out if Jobs had never left Apple. My guess is far worse than it has, so things worked out for the best. But, that is for a future post.