Are Apple and IBM Holding Back the Operating System That Will Obsolete Their Current Products?
The Party Line holds that Taligent is only in the concept stage and that widespread implementation is years away. In fact, just the opposite is true.
It's reminiscent of a classic Greek tragedy. A child is born, destined to kill its father and commit even more unspeakable acts against its mother. The parents love their child and are unwilling to kill it, so they imprison it in a secret dungeon. Despite its mistreatment, the child grows stronger, even more intent on committing its destined crimes.
The parents are Apple and IBM. The child is Taligent, a company formed by the two in 1991 to produce a new operating system called Pink. Pink's destiny: to eventually destroy the existing technologies of both parent companies - Macintosh and OS/2.
In the meantime, IBM and Apple keep their monstrous child chained and bound deep in the dungeons of Silicon Valley - where an ever-growing number of programmers churn out lines and lines of top-secret code.
While Apple and IBM use all their resources to keep Taligent hidden from public view, subterfuge is the last thing on arch-rival Microsoft's mind. Instead, the Microsoft megaphones are blaring "Windows Everywhere!" in a bid for global computer domination.
While Microsoft garners the support of software developers for future versions of Windows, Apple and IBM's secrecy about Taligent is driving away developers and potential users. But both Apple and IBM fear that disclosing the awesome power of the Pink system could steer even more users and developers away from Macintosh and OS/2.
The naked truth is that Pink makes the Macintosh and OS/2 obsolete. If Taligent's efforts succeed, most of Apple's $8-billion-per-year revenue stream will be imperiled, which currently comes from the Macintosh. IBM executives - the ones still remaining, at least - already acknowledge that OS/2, despite all their vigorous support, also will be eclipsed by Taligent.
Because the companies have so much to lose, they've created The Big Lie. The Big Lie holds that Taligent is only in the concept stage and that any widespread implementation is years away. In fact, just the opposite is true. In the summer of 1991, when Apple and IBM shocked the computer industry with their historic alliance, Apple CEO John Sculley bragged that Apple had already written 1.5 million lines of Pink code. If 1.5 million lines were written two years ago, how many exist today? A next- generation operating system might require somewhere between 2 and 3 million lines of code, so it seems as if Pink would be pretty near completion.
To understand just how far Taligent has advanced, it's important to understand why it was conceived in the first place. Most of today's operating systems, including DOS, Unix, and OS/2, are based on twenty- year-old technology created for mainframes and minicomputers. The Macintosh represented the first major commercial break from this tradition by developing ideas from Xerox PARC and other research labs into products that were marketed in 1984. But even Macintosh technology is more than ten years old.
During the last half of the 1980s, while most of the microcomputer industry was cashing in on the pre-existing design of the IBM PC and devoting shockingly little money to research and development, Apple poured hundreds of millions of dollars into fundamental research. Much of Apple's research centered on this basic theme: Given what we know now about the Macintosh, what would we do if we had it all to do over again? This strategy, although it appeared risky at the time, ultimately proved correct.
By 1990, the fruits of Apple's investment in research and development and new personnel (including a whole new crop of whiz kids just out of high school) began to pay off big. The results were new multimedia technologies, user interface designs, and operating systems technology that were superior to anything on the market at the time.
Pink represents a new breed of object-oriented operating system, which uses standardized parts - or objects - to make it easier for programmers to put together applications. These kinds of systems save time and money on development, and they can be easily upgraded and enhanced. Although other operating systems make some use of object-oriented programming, those in the know say that Pink is the first system completely designed with object orientation. Furthermore, Pink seems to be in rather good shape. Taligent has been hiring more people and has recently moved to larger headquarters in Cupertino, California.
In order to earn the high profit margin necessary to support research, Apple had to price its products significantly above competitive IBM compatible systems. As a result, Apple's market share declined by almost 50 percent during the late '80s, causing both sales and profits to plummet. Apple was forced to dramatically rethink its strategy. In 1991, the company made two radical moves: First, in order to gain back market share, hardware prices would have to come down - way down. Second, more focus was placed on software sales, because software yields higher profit margins than hardware.
For an example of software profitability, look no further than Microsoft, a company with only $2 billion in sales but with a stock market value greater than either IBM or General Motors. Whereas Microsoft's applications (such as Word and Excel) sell for hundreds of dollars, the actual cost of goods sold (the packaging, disks, and documentation) is minuscule.
To make money on software, Apple decided to retake control of its software spin-off Claris, create one new subsidiary to sell its hot multimedia software technology, and yet another to promote its radical new Pink operating system. And this time around, to earn even more money, Apple plans to sell Pink to anyone who wants to make hardware that runs it, and then earn revenue from license fees and royalties. In fact, Apple decided that in order to become a $10-billion-dollar-a- year company through software sales, it would need to license its software to the largest manufacturers. Why not start with IBM? Apple hinted to IBM that it had something so hot, it could ignite a new computer revolution.
Apple unveiled its multimedia technology first, and IBM was impressed. But when Apple revealed Pink, the folks from Big Blue saw their destiny. So the two companies formed three important partnerships: Taligent, Kaleida, and PowerPC.
Taligent would take responsibility for Pink and market it as an open standard for several hardware platforms, including the huge Intel- architecture PC standard and some of the hot new RISC architectures. Kaleida would develop and market multimedia and some of the interface technologies to Hollywood, cable TV, and the consumer electronics industry. PowerPC would bring in Motorola to transform IBM's RS/6000 RISC chip into a low-cost Pink engine, which would be dubbed the PowerPC.
Because Pink and PowerPC pose a threat to their existing multi-billion- dollar product lines, Apple and IBM agreed to keep all development under a shroud of secrecy. One year later, however, Taligent's central role in determining the future of both companies is impossible to hide.
Despite a surge in Macintosh sales, a recent survey of large corporations indicates that an overwhelming 92 percent plan to center their future computer use on Intel's 486 and Pentium chips. Realizing that the Macintosh can never prevail against the dominance of Intel- architecture systems, Apple is gradually phasing out the Mac. Taligent, on the other hand, is designed to run directly on Intel systems. The Mac III systems expected from Apple later this year will be the last family in the Macintosh product line. Also, Apple will shift its manufacturing to offshore factories to ease itself out of the hardware business. Sony has already built one of Apple's PowerBook notebook computers; Acer has been contracted to build other PowerBook models; and Apple has licensed the manufacture of its Newton hand-held computer to Sharp and other Japanese companies.
Ironically, while Pink may prove to be the technically superior operating system, by the time it's delivered, most potential developers and users won't care. The truth is that while Taligent secretly develops its revolutionary system, software developers have been turning to Windows in record numbers. Although in the short run, Apple and IBM stand to lose support for Macintosh and OS/2 by disclosing and attracting developers to the Pink platform, in the long run their strategy of secrecy will not only kill off their current operating systems but may mortally wound their prodigious child as well.