With the passing of Steve Jobs, Apple (NASDAQ:AAPL) loses its iconic founder, the tech world loses a true visionary, and all of us lose a hero of American capitalism. Rest in peace, Mr. Jobs.
The press is full of eulogies that describe in detail the man’s remarkable accomplishments in revolutionizing the technology world. But rather than think of Jobs as a tech revolutionary, I prefer to think of him as a capitalist revolutionary. In his passing, he joins the pantheon of great American capitalists who revolutionized their industries, such as John D. Rockefeller, Andrew Carnegie, Henry Ford and Sam Walton. All of these men were giants in their own time whose sheer force of will propelled the creative destruction of human progress forward.
Of all of these great men, Henry Ford probably is the best comparison. Ford didn’t invent the automobile, but he made it available to the masses. And he created a consumer culture where one had never existed before. As a young man, Jobs did the same with the personal computer. And in middle age, he did it again with digital music, smart phones and tablet computers.
In a 2005 commencement speech at Stanford University, Jobs offered advice that bears repeating today: “Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma — which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition.”
Words of wisdom by a man who lived them himself.
Jobs’ passing does raise questions for the future of Apple. When Jobs retired from his post as CEO in August, I suggested his absence would leave a void that would be difficult to fill. In August, I wrote:
“History is full of stories of successful companies that have prospered after the departure of an iconic founder. Wal-Mart (NYSE:WMT), for example, has done just fine since the passing of Sam Walton. Going further back in time, John D. Rockefeller’s oil companies survived his death and thrived to the point of trust-busting, living on today as Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX), and ConocoPhillips (NYSE:COP).
The difference, of course, is that innovation is far more important in a modern technology company than in a discount retailer or oil company. Jobs’ successors will no doubt do a fine job of selling iPods, iPhone, and iPads. The question is “what next?” Without Jobs to think of the next great idea, is the rest of the Apple management team up to the task? Again, I don’t have a satisfactory answer to this question.”
It might be somewhat counterintuitive, but I expect to see Apple’s stock price enjoy a healthy short-term sympathy bounce. Markets, in the short term, are driven by emotion. And although it might not make any economic sense, I can see sentimentality taking the stock higher.
Over the medium term, Apple should have enough Jobs-era products in the pipeline to keep things interesting, the recent disappointment concerning the iPhone update notwithstanding. But over the longer term, I don’t see Apple maintaining its edge.
Jobs’ protégés are capable managers, and I don’t see Apple going out of business anytime soon. I see the company being a worthy competitor for years to come. But I also don’t see the company continuing to be the hotbed of technological innovation.
Regardless of what happens at Apple in the coming years, Jobs’ legacy will survive because his legacy goes far beyond the company he led. Jobs will be remembered as the man who brought personal computers, legal music downloads, robust smartphones and tablet computers to the masses. And he made technology “cool.”
Rest in peace, Mr. Jobs.