|Fate||Bought by Apple, Inc.|
|Founded||1985 (California, United States)|
|Location||Redwood City, California, United States|
|Industry||Computer hardware |
|Products||NeXT Computer |
|Key people||Steve Jobs, Chairman and CEO |
Ross Perot, Director
John Patrick Crecine, Director
Avie Tevanian, VP of Engineering
Mitchell Mandich, VP of Sales and Services
|Peak size||540 (1992) employees|
NeXT, Inc. (later NeXT Computer, Inc. and NeXT Software, Inc.) was an American computer international company headquartered in Redwood City, California, that developed and manufactured a series of computer workstations intended for the higher education and business markets. NeXT was founded in 1985 by Apple Computer co-founder Steve Jobs after his forced resignation from Apple. NeXT introduced the first NeXT Computer in 1988, and the smaller NeXTStation in 1990. Sales of the NeXT computers were relatively limited, with estimates of about 50,000 units shipped in total. Nevertheless, its innovative object-oriented NeXTSTEP operating system and development environment were highly influential.
NeXT later released much of the NeXTSTEP system as a programming environment standard called OpenStep. NeXT withdrew from the hardware business in 1993 to concentrate on marketing OPENSTEP, its own OpenStep implementation, for several OEMs. NeXT also developed WebObjects, one of the first Enterprise web application frameworks. WebObjects never became very popular because of its initial high price of $50,000 but remains a prominent early example of a web server based on dynamic page generation rather than static content. Apple purchased NeXT on December 20, 1996 for $429 million, and much of the current Mac OS X system is built on the OPENSTEP foundation. WebObjects is now bundled with Mac OS X Server and Xcode.
 1985–1986: Founding NeXT
In 1984, Apple co-founder Steve Jobs was the head of Apple's SuperMicro division, which was responsible for the development of the Macintosh and Lisa personal computers. The Macintosh had been successful on university campuses mostly because of the Apple University Consortium, which allowed students and institutions to buy the computers at significant discounts. The consortium had sold more than $50 million in computers by February 1984.
As chairman, Jobs visited university departments and faculty members to sell Macintoshes. Jobs met Paul Berg, a Nobel Laureate in Chemistry, at a luncheon held in Silicon Valley to honor François Mitterrand, then President of France. Berg was frustrated by the expense of teaching students about recombinant DNA from textbooks instead of in wet labs, used for the testing and analysis of chemicals, drugs, and other materials or biological matter. Wet labs were prohibitively expensive for lower-level courses and were too complex to be simulated on personal computers of the time. Berg suggested to Jobs that he use his influence at Apple to create a "3M" workstation for higher education, featuring more than one megabyte of random access memory (RAM), a megapixel display and megaflop performance (hence the name "3M").
Jobs was intrigued by Berg's concept for a workstation and contemplated starting a higher education computer company in the fall of 1985, amidst increasing turmoil at Apple. Jobs' division did not release upgraded versions of the Macintosh and most of the Macintosh Office. As a result, sales plummeted, and Apple was forced to write off millions of dollars in unsold inventory. Apple's Chief Executive Officer (CEO) John Sculley ousted Jobs from his day-to-day role at Apple, replacing him with Jean-Louis Gassée in 1985. Later that year, Jobs began a power struggle to regain control of the company. The board of directors sided with Sculley, while Jobs took a business visit to Western Europe and the Soviet Union on behalf of Apple.
After several months of being sidelined at Apple, he resigned on Friday, September 13, 1985. He told the board he was leaving to set up a new computer company, and that he would be taking several Apple employees from the SuperMicro division with him. He also told the board that his new company would not compete with Apple and might even consider licensing its designs back to them to market under the Macintosh brand.
Jobs was joined by former Apple employees Bud Tribble, George Crow, Rich Page, Susan Barnes, Susan Kare, and Dan'l Lewin and named his new company Next, Inc. After consulting with major educational buyers from around the country (including a follow-up meeting with Paul Berg), a tentative specification for the workstation was drawn up. It was designed to be powerful enough to run wet lab simulations and cheap enough for college students to use in their dorm rooms. Before the specifications were finished, however, Apple sued Next for "nefarious schemes" to take advantage of the cofounders' insider information. Jobs remarked, "It is hard to think that a $2 billion company with 4,300-plus people couldn't compete with six people in blue jeans." The suit was eventually dismissed before trial.
In 1986, Jobs recruited the famous graphic designer Paul Rand to create a brand identity costing $100,000. Rand created a 100-page brochure detailing the brand, including the precise angle used for the logo (28°) and a new company name, NeXT. The first major outside investment was from Ross Perot, an American businessman from Texas. Perot first saw NeXT employees and Jobs featured on the public television show The Entrepreneurs. In 1987 he invested $20 million in exchange for 16% of NeXT's stock, valuing the company at $125 million. He subsequently joined the board of directors in 1988.
 1987–1993: NeXT Computer
 First generation
NeXT changed its business plan in mid-1986. The company decided to develop both computer hardware and software, instead of just a low-end workstation. A team led by Avie Tevanian, who had joined the company after working as one of the Mach kernel engineers at Carnegie Mellon University, was to develop the NeXTSTEP operating system. The hardware division, led by Rich Page, one of the cofounders who had previously led the Apple Lisa team, designed and developed the hardware. NeXT's first factory was completed in Fremont, California in 1987. It was capable of producing 150,000 machines per year. NeXT's first workstation was officially named the NeXT Computer, although it was widely referred to as "the cube" because of its distinctive case designed by frogdesign.
Prototype workstations were shown to standing ovations on October 12, 1988. The first machines were tested in 1989, after which NeXT started selling limited numbers to universities with a beta version of the NeXTSTEP operating system installed. Initially the NeXT Computer was targeted at US higher education establishments only, with a base price of $6,500. The machine was widely reviewed in magazines, generally concentrating on the hardware. When asked if he was upset that the computer's debut was delayed by several months, Jobs responded, "Late? This computer is five years ahead of its time!"
The NeXT Computer was based on the new 25 MHz Motorola 68030 central processing unit (CPU). The Motorola 88000 RISC chip was originally considered, but was not available in sufficient quantities. It included between 8 and 64 MB of random access memory (RAM), a 256 MB magneto-optical drive (MO) drive, a 40 MB (swap-only), 330 MB, or 660 MB hard drive, 10Base-2 Ethernet, NuBus and a 17-inch MegaPixel grayscale display measuring 1120 by 832 pixels. In 1989, a typical PC included 64 KB to 4 MB of RAM, the 8086, 8088, 286 or 386 CPU, a 640×350 16-color or 720×348 monochrome display, a 10 to 20 megabyte hard drive and few networking capabilities.
The magneto-optical drive manufactured by Canon was used as the primary mass storage device. These drives were relatively new to the market, and the NeXT was the first computer to use them. They were cheaper than hard drives but slower (with an average seek time of 96 ms). The design made it impossible to move files between computers without a network, since each NeXT Computer had only one MO drive and the disk could not be removed without shutting down the system. Storage options proved challenging for the first NeXT Computers. The magneto-optical media was relatively expensive and had performance and reliability problems despite being faster than a floppy drive. Disks cost about $100 each, and the drive was not sufficient to run as the primary medium running the NeXTSTEP operating system both in terms of speed and capacity.
In 1989, NeXT struck a deal for former Compaq reseller BusinessLand to sell NeXT computers in select markets nationwide. Selling through a retailer was a major change from NeXT's original business model of only selling directly to students and educational institutions. BusinessLand founder David Norman predicted that sales of the NeXT Computer would surpass sales of Compaq computers after 12 months.
In 1989, Canon invested US$100 million in NeXT, giving it a 16.67% stake, making NeXT worth almost $600 million. Canon invested in NeXT with the condition that it would be able to use the NeXTSTEP environment with its own workstations, which would mean a greatly expanded market for the software. Eventually, Canon released a NeXTstation which used the Intel GX processor for the Japanese market. Canon also served as NeXT's distributor in Japan.
The first NeXT computers were released on the retail market in 1990, for $9,999. NeXT's original investor Ross Perot resigned from the board of directors in June 1991 to dedicate more time to Perot Systems, a Dallas-based systems integrator.
 Second generation
NeXT released a second generation of workstations in 1990. The new range included a revised NeXT Computer, renamed the NeXTcube, and the NeXTstation, which used a "pizza box" case form-factor. The magneto-optical drive was replaced with a 2.88 MB floppy drive to offer users a way to use their floppy disks. However, individual 2.88 MB floppies were expensive and the technology did not supplant the 1.44 MB floppy. Realizing this, NeXT utilized the CD-ROM drive, which eventually became an industry standard for storage. Color graphics were available on the NeXTstation Color and the NeXTdimension graphics processor hardware for the NeXTcube. The new computers were cheaper and faster than their predecessors, with the new Motorola 68040 processor.
In 1992, NeXT launched "Turbo" variants of the NeXTcube and NeXTstation with a 33 MHz 68040 processor and maximum RAM capacity increased to 128 MB. NeXT's long-term aim was to migrate to the RISC (Reduced Instruction Set Computing) architecture, a processor design strategy intended to increase performance. The project was known as the NeXT RISC Workstation (NRW). Initially the NRW was to be based on the Motorola 88110 processor, but due to a lack of confidence in Motorola's commitment to the 88k architecture, it was later redesigned around dual PowerPC 601s. NeXT produced some motherboards and enclosures but exited the hardware business before full production.
Several developers used the NeXT platform to write significant programs. Tim Berners-Lee used a NeXT Computer in 1991 to create the first web browser and web server. In the early 1990s John Carmack used a NeXTcube to build two of his pioneering games, Wolfenstein 3D and Doom. Other commercial programs were released for NeXT computers, including the Lotus Improv spreadsheet program and Mathematica. The systems also came with a number of smaller built-in applications such as the Merriam-Webster Collegiate Dictionary, Oxford Quotations, the complete works of William Shakespeare, and the Digital Librarian search engine to access them.
NeXT sold 20,000 computers in 1992 (NeXT counted upgraded motherboards on back order as sales) – a small number compared with their competitors. The company reported sales of $140 million in 1992, encouraging Canon to invest a further $30 million to keep the company afloat. In total, 50,000 NeXT machines were sold.
 1993–1996: NeXT Software
NeXT started porting the NeXTSTEP operating system to PC compatible computers using the Intel 486 processor in 1992. The operating system was ported to Intel's architecture because of a change in NeXT's business strategy. By late 1993 this port was complete and version 3.1, also known as NeXTSTEP 486, was released. Prior to the release of NeXTSTEP, Chrysler planned to buy 3,000 copies in 1992. NeXTSTEP 3.x was later ported to PA-RISC and SPARC-based platforms, for a total of four versions: NeXTSTEP/NeXT (for NeXT's 68k "black boxes"), NeXTSTEP/Intel, NeXTSTEP/PA-RISC and NeXTSTEP/SPARC. Although these ports were not widely used, NeXTSTEP gained popularity at institutions such as First Chicago NBD, Swiss Bank Corporation, O'Connor and Company, and other organisations owing to its programming model. It was also used by many federal agencies, such as Naval Research Laboratory, the National Security Agency, the Advanced Research Projects Agency, the Central Intelligence Agency and the National Reconnaissance Office.
NeXT withdrew from the hardware business in 1993 and the company was renamed NeXT Software Inc; 300 of the 540 staff employees were laid off. NeXT negotiated to sell the hardware business including the Fremont factory to Canon. Canon later pulled out of the deal. Work on the PowerPC machines was stopped along with all hardware production. CEO of Sun Microsystems Scott McNealy announced plans to invest $10 million in 1993 and use NeXT software (OpenStep) in future Sun systems. NeXT partnered with Sun to create OpenStep which was NeXTSTEP sans the Mach-based FreeBSD kernel. After dropping the hardware business, NeXT returned to selling a toolkit to run on other operating systems, in effect returning to the original business plan. New products based on OpenStep were released, including OpenStep Enterprise, a version for Microsoft's Windows NT. The company also launched WebObjects, a platform for building large scale dynamic web applications. Many large businesses including Dell, Disney, WorldCom, and the BBC used this WebObjects software. Apple still uses it for the iTunes Store and most of its corporate website.
 1996: After NeXT
Apple Computer announced an intention to acquire NeXT on December 20, 1996. Apple paid $429 million in cash which went to the initial investors and 1.5 million Apple shares which went to Steve Jobs. (Steve Jobs was deliberately not given cash for his part in the deal.)The main purpose of the acquisition was to use NeXTSTEP as a foundation to replace the dated Mac OS operating system. Apple favoured this option over others which included continuing development of the Copland operating system, purchasing the BeOS operating system, or licensing Windows NT from Microsoft. Jobs returned to Apple as a consultant in 1997 and then after the 4 July weekend the same year became interim CEO.In 2000 Jobs took the CEO position as a permanent assignment.
Several NeXT executives replaced their Apple counterparts when Steve Jobs restructured the company board of directors. Over the next five years the NeXTSTEP operating system was ported to the PowerPC architecture, and the Intel port and the OpenStep Enterprise toolkit for Windows were kept in sync. The operating systems were code named Rhapsody, while the toolkit for development on all platforms was called 'Yellow Box'. For backwards compatibility Apple added the 'Blue Box' to the 'Mac', allowing existing Mac applications to be run in a self-contained cooperative multitasking environment.
A consumer version of the new operating system was released as Mac OS X 10.0 in 2001. A server version was released soon after. The OpenStep developers toolkit was renamed Cocoa. Rhapsody's Blue Box was renamed Classic Environment. Apple included an updated version of the original Macintosh toolbox that allowed existing Mac applications access to the environment without the constraints of Blue Box called Carbon.Some of NeXTSTEP's interface features were used in Mac OS X; these included the Dock, the Services menu, the Finder's 'browser' view, the text system NSText, and system-wide selectors for fonts and colors.
NeXTSTEP's processor-independent capabilities were retained in Mac OS X. Every version was compiled on both PowerPC and Intel x86 architectures although only PowerPC versions were released until 2005. Apple publicly announced on June 6, 2005 plans to base future systems on Intel processors.The transition to Intel was completed by August 2006.
 Corporate culture and community
Jobs had felt stymied by Apple's corporate structure and was determined to avoid the bureaucratic infighting that led to his resignation. He created a different corporate culture at NeXT in terms of facilities, salaries, and benefits. Jobs had experimented with some structural changes at Apple but at NeXT he abandoned conventional corporate structures, instead making a community with members instead of employees. There were only two different salaries at NeXT until the early 1990s. Team members who joined before 1986 were paid $75,000 while those who joined afterwards were paid $50,000. This caused a few awkward situations where managers were paid less than their employees. Employees were given performance reviews and raises every six months because of the spartan salary plans. To foster openness, all employees had full access to the payrolls, although few employees ever took advantage of the privilege. NeXT's health insurance plan offered benefits to not only married couples but unmarried couples and same-sex couples. The payroll schedule was also very different from other companies in Silicon Valley at the time: instead of getting paid twice a month at the end of the pay period, employees would get paid once a month in advance.
Jobs found office space in Palo Alto on Deer Creek Road, occupying a glass and concrete building which featured a staircase designed by architect I. M. Pei. The first floor used hardwood flooring and large worktables where the workstations would be assembled. To avoid inventory errors NeXT used the just in time (JIT) inventory strategy. The company contracted out for all major components such as mainboards and cases and had the finished components shipped to the first floor for assembly. The second floor was the office space with an open floor plan. The only enclosed rooms were Jobs' office and a few conference rooms. As NeXT expanded more office space was needed. The company rented an office in Redwood City, designed by Pei. The architectural centerpiece was a "floating" staircase with no visible supports. The open floor plan was retained although furnishings became luxurious with $10,000 sofas and Ansel Adams prints.
The first issue of NeXTWORLD magazine was printed in 1991. It was published in San Francisco by Integrated Media and edited by Michael Miley and later Dan Ruby. It was the first and only mainstream periodical to discuss NeXT computers, the operating system, and NeXT software. Publication was discontinued in 1994 after only four volumes were released. A NeXTWORLD Expo followed as a developer conference, held in 1991 and 1992 at the San Francisco Civic Center and in 1993 at the Moscone Center in San Francisco, with Steve Jobs as the keynote speaker.
 Impact on the computer industry
Despite NeXT's lack of commercial success the company had a profound impact on the computer industry. Object oriented programming and user interfaces became more common after the release of the NeXTcube and NeXTSTEP in 1988 when other companies started to emulate NeXT's object-oriented system. Apple started the Taligent project in 1989, with the goal of building a NeXT-like operating system for the Macintosh, with collaboration from both HP and IBM.
Microsoft announced the Cairo project in 1991; the Cairo specification included similar object oriented user interface features for a coming consumer version of Windows NT. Although the project was ultimately abandoned some elements were integrated into other projects. By 1994 Microsoft and NeXT began collaborating on a Windows NT-port of OpenStep; the port however was never released.
WebObjects failed to achieve wide popularity partly because of the initial high price of $50,000, but it remains a prominent early example of a web server based on dynamic page generation rather than static content. WebObjects is now bundled with Mac OS X Server and Xcode.[