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Apple CEO Steve Jobs Steps Down

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Apple CEO Steve Jobs. (AP)

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CUPERTINO (CBS / CNET) – Apple Inc. said Steve Jobs, the mind behind the iPhone, iPad and other devices that turned Apple into one of the world’s most powerful companies, resigned as the company’s CEO Wednesday, indicating that he could no longer handle the job.

His place at the top of the company will be taken over by Tim Cook, Apple’s chief operating officer since 2004. He has long been Jobs’ right-hand executive.

The 56-year-old year-old Jobs, who co-founded Apple in a garage in 1976, is a survivor of pancreatic cancer and previously received a liver transplant. He has been rumored to be in bad health.

In a note to Apple’s board of directors and employees on Wednesday, Jobs said that he was no longer up to the job of CEO – but would continue to serve as Chairman of the Board.

“I have always said if there ever came a day when I could no longer meet my duties and expectations as Apple’s CEO, I would be the first to let you know. Unfortunately, that day has come,” Jobs said.

Despite stepping down as CEO, Jobs concluded his letter by maintaining that “Apple’s brightest and most innovative days are ahead of it.”

KCBS’ Chris Filippi Reports:

Shares of Apple’s stock were down $18.68, or about 5 percent, in after-hours trading on Wednesday following word of Jobs’ resignation. The drop reflected uncertainty about Apple’s future ability to continue its high level of innovation without Jobs at the helm.

Jobs has been dogged by a string of health problems in recent years that forced him to take periodic leaves of absence from the company. Nonetheless, he had remained involved in the larger decisions at Apple, and even demonstrated the new iPad model during a surprise appearance at a news conference in March.

KCBS Technology Analyst Larry Magid Comments:

“Apple has a product pipeline of a couple or three years–what will they have after that? Will Tim Cook be able to come up with a product out of the box like iPhone? Apple has a strong bench and deserves the benefit of the doubt,” New York Times business columnist Joe Nocera said on CNN.

“Steve has been on medical leave for eight months, and Apple became the most valuable company in the world,” added Steven Levy, a senior writer at Wired and author of ‘In the Plex: How Google Thinks, Works and Shapes our Lives.’ “Between his partial contributions while on medical leave and the values that he has baked into the company, Apple still operates at a super-high level.”

Apple Co-Founder Steve Wozniak Weighs In On Jobs’ Departure:

But Trip Chowdhry, an analyst with Global Equities Research, predicted that the company will eventually struggle to come up with market-changing ideas.

“Apple is Steve Jobs, Steve Jobs is Apple, and Steve Jobs is innovation,” Chowdhry told the Associated Press. “You can teach people how to be operationally efficient, you can hire consultants to tell you how to do that, but God creates innovation… Apple without Steve Jobs is nothing.”

The Jobs era
One of the most legendary businessmen in American history, Jobs turned three separate industries on their head in the 35 or so years he has been involved in the technology industry.

Personal computing was largely invented with the launch of the Apple II in 1977. Legal digital-music recordings were brought into the mainstream with the iPod and iTunes in the early 2000s, and mobile phones were never the same after the 2007 debut of the iPhone. Jobs played an instrumental role in the development of all three, and managed to find time to transform the art of computer-generated movie-making on the side.

The release of the iPad in 2010, a touch-screen tablet computer his competitors flocked to reproduce, could be considered the capstone of his career as a technologist. A conceptual hybrid of a touch-screen iPod and a slate computer, the 10-inch mobile device was Jobs’ vision for a more personal computing device.

Jobs is considered brilliant yet brash. He values elegance in design yet is almost never seen in public wearing anything but a black mock turtleneck, blue jeans, and a few days’ worth of stubble. A master salesman who considers himself an artist at heart, Jobs inspires both reverence and fear in those who work for him and against him, and is adored by an army of loyal Apple customers.

Jobs was born in San Francisco in 1955 and moved out of the city five years later to the Santa Clara Valley, later to be known as Silicon Valley. He grew up in Mountain View and Cupertino, where Apple’s headquarters are located.

He attended Reed College in Portland, Ore., for a year but dropped out, although he sat in on some classes that interested him, such as calligraphy. After a brief stint at Atari working on video games, he spent time backpacking around India, furthering teenage experiments with psychedelic drugs and developing an interest in Buddhism, all of which would shape his work at Apple.

Back in California, Jobs’ friend Steve Wozniak was learning the skills that would change both their lives. When Jobs discovered that Wozniak had been assembling relatively (for the time) small computers, he struck a partnership, and Apple Computer was founded in 1976 in the usual Silicon Valley fashion: setting up shop in the home of one of the founder’s parents.

Wozniak handled the technical end, creating the Apple I, while Jobs ran sales and distribution. The company sold a few hundred of the Apple I, but found much greater success with the Apple II, which put the company on the map and is largely credited as having proven that regular people wanted computers.

It also made Jobs and Wozniak rich. Apple went public in 1980, and Jobs was well on his way to becoming one of the first tech industry celebrities, earning a reputation for brilliance, arrogance, and the sheer force of his will and persuasion, often jokingly referred to as his “reality-distortion field.”

The debut of the Macintosh in 1984 left no doubt that Apple was a serious player in the computer industry, but Jobs only had a little more than a year left at the company he founded when the Mac was released in January 1984.

By 1985 Apple CEO John Sculley–who Jobs had convinced to leave Pepsi in 1983 and run Apple with the legendary line, “Do you want to spend the rest of your life selling sugared water or do you want a chance to change the world?”–had developed his own ideas for the future of the company, and they differed from Jobs’. He removed Jobs from his position leading the Macintosh team, and Apple’s board backed Sculley.

Jobs resigned from the company, later telling an audience of Stanford University graduates “what had been the focus of my entire adult life was gone, and it was devastating.” He would get the last laugh.

He went on to found NeXT, which set about making the next computer in Jobs’ eyes. NeXT was never the commercial success that Apple was, but during those years, Jobs found two things that would help him architect his return.

The first was Pixar. Jobs snapped up the graphic-arts division of Lucasfilm in 1986, which would go on to produce “Toy Story” in 1995 and set the standard for computer-graphics films. After making a fortune from Pixar’s IPO in 1995, Jobs eventually sold the company to Disney in 2006.

The second was object-oriented software development. NeXT chose this development model for its software operating systems, and it proved to be more advanced and more nimble than the operating system developments Apple was working on without Jobs.

Jobs returned to Apple in 1996, having convinced then-CEO Gil Amelio to adopt NeXTStep as the future of Apple’s operating system development. Apple was in a shambles at the time, losing money, market share, and key employees.

By 1997, Jobs was once again in charge of Apple. He immediately brought buzz back to the company, which pared down and reacquired a penchant for showstoppers, such as the 1998 introduction of the iMac; perhaps the first “Stevenote.” His presentation skills at events such as Macworld would become legendary examples of showmanship and star power in the tech industry.

Jobs also set the company on the path to becoming a consumer-electronics powerhouse, creating and improving products such as the iPod, iTunes, and, later, the iPhone and iPad. Apple recently became the most valuable company in the world, with a market capitalization topping $330 billion.

He did so in his own fashion, imposing his ideas and beliefs on his employees and their products in ways that left many a career in tatters. Jobs enforced a culture of secrecy at Apple and was an extremely demanding leader, terrorizing Apple employees when he returned to the company in the late 1990s with summary firings if he didn’t like the answers they gave when questioned.

Jobs is an intensely private person. That quality put him and Apple at odds with government regulators and stockholders who demanded to know details about his ongoing health problems and his prognosis as the leader and alter ego of his company. It spurred a 2009 SEC probe into whether Apple’s board had made misleading statements about his health.

Jobs’ last public appearance as Apple’s CEO was in June at the company’s Worldwide Developers Conference, where Apple debuted its upcoming iOS 5 and iCloud efforts.

(Copyright 2011 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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