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If Apple (Nasdaq: AAPL) takes the wraps off of any new products over the next six months, CEO Steve Jobs will not be introducing them to the world.
Jobs and his company announced Wednesday that he will be taking a medical leave of absence to deal with new concerns regarding his health.
Once again, Jobs made the announcement in a letter to employees. And once again, the letter acknowledged health issues that differ from previous statements, and that has thrown fuel on another firestorm of speculation in the blogosphere and the traditional media about Jobs' future with Apple, the managerial line of succession and the company's public relations strategy.
'Health-Related Issues'
Jobs' Wednesday letter referred to the statement he issued before last week's Macworld Expo -- the first Jobs-less Expo in a decade -- in which the 53-year-old CEO admitted that his absence was not a matter of economics, but due to a "hormonal imbalance" that caused the weight loss evident when he appeared on stage at the August 2008 launch of the iPhone 3G. Jobs is recovering from a rare form of pancreatic cancer, but the letter never made any connection between that and the hormonal issue.
"Unfortunately, the curiosity over my personal health has continued to be a distraction not only for me and my family, but everyone else at Apple as well," Jobs wrote Wednesday. "In addition, during the past week I have learned that my health-related issues are more complex than previously thought.
"In order to take myself out of the limelight and focus on my health, and to allow everyone at Apple to focus on delivering extraordinary products, I have decided to take a medical leave of absence until the end of June."
Chief operating officer Tim Cook will oversee day-to-day operations at Apple, with Jobs staying involved in "major strategic decisions." There will be no elaboration on the letter, Apple spokesperson Steve Dowling told MacNewsWorld.
Analyst Reaction
"I feel like I've been expecting this for a while," Endpoint Technologies principal Roger Kay told MacNewsWorld. "Apple is releasing information as slowly and as minimally as possible, but is still acknowledging that Steve is a very sick guy. Tim Cook can make the trains run on time, but longer-term Apple direction is now up in the air, and that's reflected in the stock price."
Apple shares dropped sharply in after-hours trading; Apple released the letter after the close of trading Wednesday. The news prompted financial news network CNBC to devote an hour of prime-time programming to Jobs and Apple.
The news came as little surprise to Creative Strategies president Tim Bajarin. "I think what's really happened is the doctors have come back and said, 'look, you need to give 100 percent of your energies behind this [health recovery],'" Bajarin told MacNewsWorld. "Putting all of his energy toward getting him back to health is the important thing right now for him and Apple long-term."
All products that Apple will introduce over the next year to 18 months are already in the pipeline, "and it's critical they execute on that," Bajarin said. However, Cook took over for Jobs during his pancreatic cancer surgery during a time when the company was preparing the iPhone, "and that came out on time."
"Apple will insist they are fine, and they are in the short term," Kay agreed. "You don't need Steve for the next generation of iPod or whatever. But they do need Steve as a creative critic and to make the tough choices about products, where the money should be spent and where it shouldn't. That's been his role all along."
PR Strategy Working?
The headline on New York Times business columnist Joseph Nocera's blog posting Thursday read, "It's Time for Apple to Come Clean."
If Apple had been clear in 2006 and offered every detail of Jobs' health, "it would have turned into the Steve Jobs death watch," software marketing specialist Merrill "Rick" Chapman told MacNewsWorld. "Two years of that is a lot worse than a six-month Steve Jobs death watch. They've had plenty of time to do succession planning, plenty of time to check around and see who could have filled those shoes.
"Apple did what Steve Jobs told them to do. Jobs has always been very concerned about maintaining privacy. He's always been secretive and he's always been pretty good at keeping a secret. I think it's exactly what you would expect from Apple," said Chapman, author of the book In Search of Stupidity: 20 Years of High-Tech Marketing Disasters.
Couldn't a host of unconfirmed health-related rumors on the blogosphere -- some of which have led to stock price damage -- have been avoided by Apple seizing control of this message from the start?
"Probably, but let's be clear," Bajarin said. "He keeps his personal life extremely guarded, and whether we like it or not, that's a personal decision. They do have a fiduciary responsibility, if there's an issue, to at least bring it up. I think that's what's ultimately come to the board and Steve in general; we do owe it to investors and customers, etc., to be at least upfront about where things are."
Still, "what's very important about this release is that it said nothing about a recurrence of cancer," Bajarin added.
"Should they have the medical charts on Apple's Web site?" Kay asked rhetorically. "They're also trying to balance that with human qualities regarding the guy's privacy and some respect for his feelings. What they have done is naturally human, but at the same time maybe withholding information that's highly material to Apple functioning as a company."
Apple's Future and Jobs' Legacy
Another aspect of this story: what Jobs has meant to the technology industry and its impact on everyday lives. While many analysts were quick to avoid writing premature obituaries for Jobs, they acknowledged that his ability to sell products and his strategic thinking cannot be ignored. He helped launch the personal computing revolution, made computers easy to use with the first Macintosh back in 1984, breathed life into the music industry while revolutionizing portable media with the iPod, guided Pixar (Nasdaq: PIXR) into becoming a major force in animated storytelling and is now putting his own stamp on the smartphone.
"He's an important character, historically," Bajarin said. "He's an iconic figure, with extreme vision and an eye for style. He has an uncanny ability to understand what customers want, even before they understand it themselves."
All of this illustrates the difficulties Apple faces with managerial succession if Jobs were ever to permanently leave the company -- for whatever reason. "No one else has the prestige and roots that go all the way back to the beginnings of the industry," Kay said. "It's one thing to command smart, ego-centric people and make them do what you want. He can do that."
"It's difficult to think of a more dramatic turnaround in American business" than when Jobs grabbed back the reins of Apple in the late 1990s. Chapman said. Not Lou Gerstner with IBM (NYSE: IBM), or Henry Ford II with his family's car company have been able to achieve the same results as Jobs in Cupertino. "I can't think of a single person in high-tech who accomplished that kind of turnaround, especially given the competitive terrain."
