Steve Jobs Takes the D Stage

Steve Jobs took the stage at the All Things Digital conference in Rancho Palos Verdes, Calif., and said Apple's $237 billion market cap, $11 billion bigger than rival Microsoft's , is "surreal," but also "that it doesn't matter very much."

Steve Jobs
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Steve Jobs

Jobs reminisced that Apple was about 90 days away from going bankrupt when he returned. He was so happy to find a core group of Apple insiders who "bled in six colors," a reference to that original, rainbow Apple logo, and knew that Apple would be on the mend. It makes today's market cap news all the sweeter, give the dire straits this company was in.

The Wall Street Journal's Walt Mossberg began the line of questioning immediately seizing on the Flash controversy with Adobe , and the competing standards for video on the net, asking whether it was fair for the iPad to cut off consumers from the technology. Jobs said that part of Apple's success rested with the company's ability to choose the "right horses" when it comes to technology. "If you choose wisely, you can save yourself an enormous amount of work," said Jobs.

"Flash looks like a technology that had its day, but it's waning," says Jobs. And HTML5, its competing platform, he says, is starting to emerge, a technology that doesn't need a plug-in to run it, and it works better and looks better.

"We have over 200,000 apps on the App Store," says Jobs, so developers are flocking to the platform, in answer to the question about whether developers are getting confused by the controversy.

"We were trying to be real professional about this...and we were tired of these guys trashing us in the press," says Jobs about Adobe.

"We have the courage of our convictions," Jobs says in his decision to steer clear of Adobe and Flash. The company answers to consumers, but that consumers rely on Apple to make tech decisions for them, and that considering Apple has sold an iPad every 3 seconds since launch, it must be going okay.

Jobs also talked about his new penchant for responding to emails from consumers, and in one case, from a blogger who never identified himself as such. He called the exchange "obnoxious."

Jobs was also asked about that stolen iPhone that was picked up in a Redwood City, Calif. bar. The case has attracted global attention, and put a focus on journalists vs. blogger rights. Jobs said the iPhone in question was either left in a bar or stolen out of the employee's bag. The person who got the phone tried to sell it, tried to activate it by plugging it into a roommate's computer, and the roommate called police because she was worried that evidence was going to be destroyed. Doors weren't kicked in, said Jobs, in answer to reports that the blogger involved in this was mistreated by authorities. And the investigation continues, which has everything, Jobs added, from theft and drama, "there's probably sex in there somewhere too! Someone should make a movie!"

In answer to questions about the suicide spate at Apple's manufacturing partner FoxConn. There have been 9 suicides, 13 attempts, in a workforce of 400,000. Jobs says FoxConn is "not a sweatshop," says Apple is over there trying to understand what's happening, and how the company can help. Jobs says he is sensitive to suicide clusters because of a situation at Gunn High School in his own town of Palo Alto.

The conversation turned to the platform war with Microsoft, which Mossberg says was clearly won by Microsoft. In the mobile world, a new war has broken out, this time Apple versus Google, even Facebook. "We never thought we were in a platform war with Microsoft, and that's probably why we lost," says Jobs.

In reaction to the new front opening with Google, Jobs was asked why there was a change in the relationship with Apple's one-time partner. "Well, they decided to compete with us," he said.

"We didn't go into the Search business," said Jobs. "They decided to compete with us and it got more and more serious."

"Do you feel betrayed?" Jobs was asked. "We're about making better products," he said. "We want to make better products than they do."

"We definitely compete with each other."

Also, "We have no plans to get into the Search business."

Jobs later addressed another competitive front between Google and Apple in mobile advertising. He said Apple's new iAd network is designed for its developers, that Apple won't make much money from it, that ads in Apple's apps will mean money for them, and not Apple. He doesn't understand other approaches, saying in a not so veiled swipe at Google that what the other guys are doing "sucks." I assume the folks at Google's AdMob will have a different point of view.

On the AT&T network: "They're handling way more data traffic than all their competitors combined. It's improving. I wish I could day rapidly. I'm convinced that any other network, if you put this amount of iPhones on it, would have the same problems."

On whether iPhone would go to another network, say Verizon? "The future is long," said Job, and the short term is something he said he couldn't talk about. Tease.

On the iPad: For the first time, Jobs says Apple set down on the path of a tablet computer before development of the iPhone began, in the early part of the decade. "I put the tablet project on the shelf," and began to focus on the phone.

"We've re-imagined" the tablet PC, said Jobs. He hearkened back to the US when we were an agrarian nation and automobiles came on the scene. Everything was a truck. But as cars went more urban, there was power steering, radios. That's what is happening in computing: personal computers will become trucks, and the rest of the industry will move toward tablets, the iPad, and that may make some people uncomfortable.

"There's something about it that's magical," says Jobs of the iPad.

Will the tablet save journalism? "We have a lot goals with it," said Jobs. "Any Democracy depends on a free, healthy press," he said. The Washington Post, New York Times, Wall Street Journal, "I don't want to see us descend into a nation of bloggers," he said. New ways of expression and new ways of generating revenue could save the industry. He wants to see a new model where consumers pay for content on the web. "Price aggressively and go for volume," he said. "I believe people are willing to pay for content."

Jobs was also asked about Apple's power over content and what's included on the Apple App Store, as an example. Is there a risk that Apple can censor certain material, and exert too much influence over content, political perspectives, and how are these decisions made? "We approve 95 percent of the Apps submitted every week," and do so in under seven days. It's a stunning statistic considering 10,000 to 20,000 apps are submitted every week.

Apple was called on the carpet for denying a political cartoonist a place on the App Store. Jobs says the cartoonist defamed someone. "We are guilty as charged for making mistakes" in a rare admission of contrition. That political cartoonist, by the way, won a Pulitzer Prize.

Jobs was asked what his role is in Apple's development. "Apple's an incredibly collaborative" company. No committees, he says, and Apple acts as a start-up. "We're the biggest start-up on the planet."

Teamwork, he said, is the key. "We're great at figuring out how to divide things up," and communication is key. "I meet with teams of people" all day. "We have wonderful arguments" and Jobs says his employees are not scared to disagree with him.

In the question and answer portion, Jobs said the last few years reminded him that "life is fragile."

He was also asked about the ability to share digital entertainment content across the myriad Apple devices that typical users own, whether it's an iPod, a Mac, an iPhone and now the iPad. Wirelessly. Currently, you can do that with a wire, but consumers have been clamoring for a wireless option. Jobs was very cryptic about this, but with all the rumors about Apple's entry into Cloud-based computing, seems to me that he was dropping hints that this is something that could be announced as soon as the Developers Conference next week. You'll hear loud applause if that comes to pass.

Jobs, who appeared personable, healthy, animated and relaxed, spoke to D organizers Kara Swisher and Walt Mossberg, in front of a crowd of hundreds at the swanky Terranea Resort in Rancho Palos Verdes.

Just a cursory look at the attendees, and I'm sitting near Steve Case, Jeffrey Katzenberg, Rupert Murdoch, Arianna Huffington, Yusef Mehdi, Mike Montgomery, Esther Dyson, Mark Zuckerberg, Julius Genachowski. So many others. This was the hottest ticket in town.

Murdoch opened the event with some prepared remarks, with a health accent on "content" versus technology. "What's an iPod without music," he asked? Murdoch wants a "fair price" for his content, and these are sensitive sentiments ahead of Jobs taking the stage.

Jobs said that the opportunities for content creators are huge. They have to understand who their real customers are; not the distributors of it, but listeners, viewers, readers. It's a lesson Jobs and team taught the music industry, and continues to teach studios and publishers.

Murdoch says his Wall Street Journal is the only paper among the top 25 to enjoy growth. About 10,000 WSJ subscribers have paid to join the iPad, about 5,000 for his London Times, and another 4,500 in Australia.

Jobs held this audience's rapt attention for nearly two hours. Very little interest in his health, which is a real sign of the times. Not a word about iPhone 4G, which will be the highlight of the Apple Worldwide Developers Conference in San Francisco on June 7.

Questions? Comments?