Apple II Becomes the First Successful Preassembled Personal Computer Summary

  • Last updated on November 10, 2022

The introduction of the preassembled Apple II personal computer by Apple Computer created a new market for home, education, and small-business computing.

Summary of Event

The development of the computer during the 1940’s expanded the capacity to do intensive mathematical calculations far faster than teams of scientists could. Initially, it was thought that computers would be effective only for scientific work; in the 1950’s, it was shown that business could make great use of them. Into the 1960’s, however, the idea that a small computer could be of use to the average person was an idea held by only a few radicals within the industry. It was a pair of counterculture individuals from the Silicon Valley—the area in California between San Francisco and San Jose known for high-technology industries—who eventually launched the personal computer revolution. Apple II computer[Apple two computer] Computers;Apple II[Apple two] Personal computers;Apple II[Apple two] Apple Computer [kw]Apple II Becomes the First Successful Preassembled Personal Computer (Apr., 1977) [kw]First Successful Preassembled Personal Computer, Apple II Becomes the (Apr., 1977) [kw]Preassembled Personal Computer, Apple II Becomes the First Successful (Apr., 1977) [kw]Personal Computer, Apple II Becomes the First Successful Preassembled (Apr., 1977) [kw]Computer, Apple II Becomes the First Successful Preassembled Personal (Apr., 1977) Apple II computer[Apple two computer] Computers;Apple II[Apple two] Personal computers;Apple II[Apple two] Apple Computer [g]North America;Apr., 1977: Apple II Becomes the First Successful Preassembled Personal Computer[02800] [g]United States;Apr., 1977: Apple II Becomes the First Successful Preassembled Personal Computer[02800] [c]Computers and computer science;Apr., 1977: Apple II Becomes the First Successful Preassembled Personal Computer[02800] [c]Trade and commerce;Apr., 1977: Apple II Becomes the First Successful Preassembled Personal Computer[02800] [c]Science and technology;Apr., 1977: Apple II Becomes the First Successful Preassembled Personal Computer[02800] Wozniak, Stephen Jobs, Steve Markkula, Mike McKenna, Regis Scott, Michael Holt, Frederick Rodney Espinosa, Chris Wigginton, Randy

Apple Computer founder Steve Jobs introduces the Apple II personal computer in 1977.

(AP/Wide World Photos)

Both Steve Jobs and Stephen Wozniak had attended Homestead High School in Los Altos, California, although at different times, and both developed early interests in technology, especially computers. In 1971, Wozniak built his first computer from spare parts. Shortly after this, he was introduced to Jobs. Jobs had already developed an interest in electronics (he once telephoned William Hewlett, cofounder of Hewlett-Packard, to ask for parts), and he and Wozniak became friends. Their first business venture together was the construction and sale of “blue boxes,” illegal devices that allowed the user to make long-distance telephone calls for free. The business expanded in 1972 when Wozniak began attending the University of California at Berkeley and Jobs went to Reed College in Oregon. The following year, Wozniak began working at Hewlett-Packard, where he studied calculator design; Jobs went to work for Atari, the video game publisher and developer. The friendship paid off again when Wozniak, at Jobs’s request, designed the game Breakout for Atari, and the pair was paid seven hundred dollars.

In 1975, the Altair computer, Altair a personal computer in kit form based on the Intel 8080 microprocessor, was introduced by Micro Instrumentation and Telemetry Systems Micro Instrumentation and Telemetry Systems (MITS). Shortly thereafter, the first personal computer club, the Homebrew Computer Club, Homebrew Computer Club began meeting in Menlo Park, near Stanford University, and Wozniak and Jobs began attending the meetings regularly. Wozniak eagerly examined the Altairs that others brought. He thought that the design could be improved. When MOS Technology offered its new 6502 microprocessor chip for twenty dollars, he decided to test his ideas. Before beginning work on the new design, Wozniak wrote a version of the computer programming language BASIC BASIC (computer language) for the new chip. After that task was accomplished, he turned to the computer design. In only a few more weeks, he had produced a circuit board utilizing the MOS chip, along with interfaces that connected it to a keyboard and a video monitor. A hobbyist at heart, Wozniak showed the machine at a Homebrew meeting and distributed photocopies of the design.

Jobs, however, saw the potential opportunity that this machine, which he named an “Apple,” presented. He talked Wozniak into forming a partnership to develop personal computers. Jobs sold his car and Wozniak sold his two Hewlett-Packard calculators; with the money they raised, they had printed circuit boards made, which sped up the production process. Their break came when Paul Terrell, Terrell, Paul a retailer, was so impressed with their work that he ordered fifty fully assembled Apples. Within thirty days, the computers were completed; each sold for the ominous-sounding price of $666.66.

During the summer of 1976, Wozniak turned his attention to developing an improved version of the Apple. The new computer would come with a keyboard, an internal power supply, BASIC built into the onboard memory, slots for adding peripheral cards to link with printers and other devices, and color graphics, all enclosed in a case. The output would be seen on a television. Jobs and Wozniak calculated the price for the complete machine to be $1,200.

Jobs then began to seek the help they would need to implement their design successfully. After consulting with Nolan K. Bushnell, Bushnell, Nolan K. his former boss and founder of Atari, Jobs was led to Mike Markkula, a former marketing manager at both Fairchild Semiconductor and Intel Corporation. Wealthy through stock options, Markkula had retired at an early age. After visiting the young entrepreneurs in Jobs’s garage, however, Markkula decided to help them with a business plan. In a few months, in return for a $91,000 personal investment and a guarantee for a $250,000 line of credit at Bank of America, Markkula received one-third share of the now incorporated Apple Computer.

At about the same time Jobs was introduced to Markkula, two other key figures joined Apple. Frederick Rodney Holt, an analog engineer at Atari, was brought aboard to design the power supply. Wozniak, familiar only with digital (binary) and not analog (wave) electronics, was unable to design the power supply. Holt not only designed the light, fanless power supply but also convinced Jobs and Wozniak not to challenge the Federal Communications Commission over the television interface. Instead, the interface was given over to third-party developers so that users, not Apple, would be in violation. Another key figure was Regis McKenna, head of the Regis McKenna Public Relations agency. His was the best of the public relations firms that served the high-technology industries of the valley, and Jobs wanted the agency to handle the Apple account. At first, McKenna rejected the offer, but Jobs’s constant pleadings finally convinced him. The agency’s first contributions to Apple were the design of the colorful striped Apple logo and a color ad in Playboy magazine designed to broaden the machine’s appeal beyond the small group of hobbyists. Both proved to be wise moves.

In February, 1977, the first Apple Computer corporate office was opened in Cupertino, California. By this time, two of Wozniak’s friends from Homebrew, Randy Wigginton and Chris Espinosa—both high school students—had joined the company. Their specialty was in writing software. Espinosa worked through his Christmas vacation so that BASIC could ship with the computer. It was also at this time, at Markkula’s suggestion, that Michael Scott was selected as company president. Markkula did not want to manage the company and believed that Jobs was not ready to do it. (Scott had worked with Markkula at Fairchild Semiconductor.)

The team pushed ahead to complete the new Apple in time to display it at the First West Coast Computer Faire in April. Jerry Mannock, Mannock, Jerry formerly with Hewlett-Packard, was hired to create the design for the case. The first cases, made by another company, were uneven in quality, but the group worked out the worst flaws. At this time, the name Apple II was chosen for the new model. The Apple II computer included a combination of innovative components. The motherboard was far simpler and more elegantly designed than that in any previous computer, and the power supply was cooler and lighter. The ease of hooking the Apple II up to a television monitor increased the computer’s attractiveness to potential buyers. Within and without, the Apple II was sleek and powerful.

The company continued to grow in 1977. Demand for the Apple II increased, and production doubled every few months. Apple Computer earned $2.7 million in 1977, and the personal computer was well on its way to establishing itself with consumers.

Significance

The introduction of the Apple II computer launched what was to be a wave of new computers aimed at the home and small-business markets. Within a few months of the Apple II’s introduction, Commodore introduced its PET (Personal Electronic Transactor) computer and Tandy/Radio Shack brought out its TRS-80.

Apple continued to work on producing the peripheral cards that would help increase demand. Prospects were so good for the company that two large venture capitalist groups, Rockefeller-backed Venrock Associates and Arthur Rock & Company (which had launched Intel), invested large sums in Apple. At the end of 1977, however, there was no way to know that Apple would become the dominant player in the personal computer field. Both Commodore and Tandy/Radio Shack had presumed strengths in their well-established distribution lines. Apple had worked out a distribution deal with the newly established ComputerLand franchise chain, however, and Commodore’s marketing tactics soured that company’s potential relationships with retailers.

Nevertheless, the future for Apple at the close of 1977 was still unclear. Following up on a suggestion made by Markkula at a December strategy meeting, Wozniak began work on creating a floppy disk system for the Apple II. The cassette tape storage that all personal computers were relying on was, unfortunately, not very reliable, and it was very time-consuming. Floppy disks, Floppy disks which had been introduced for larger computers by International Business Machines (IBM) IBM in 1970, were reliable and fast. Markkula wanted one to show at the Consumer Electronics Show in January.

As with everything that interested him, Wozniak spent almost all of his time learning about and designing a floppy disk drive. Once he understood the principles involved, he designed a simpler control circuit, then eliminated the need for synchronization circuitry altogether. Finally, with Wigginton’s assistance, Wozniak wrote the software used to read from and write to the disk. When the final drive shipped in June, 1978, it made possible real development of software for the computer and opened up the market to nonhobbyists. The floppy disk drive also positioned Apple ahead of both Commodore and Tandy/Radio Shack.

The final element that cemented Apple’s place in the personal computer market occurred in 1979 when Personal Software, Personal Software Daniel Fylstra’s software marketing company, introduced VisiCalc. VisiCalc[Visicalc] Spreadsheet software VisiCalc was the first spreadsheet program—a program that featured financial data stored in table form, along with the ability to make some data dependent on other data. This meant that “what if” financial forecasting could be quickly and easily done. For the first time, there was now a compelling reason for the purchase of an Apple II.

By 1980, Apple had sold 130,000 Apple II’s. That year, the stock went public, and Jobs and Wozniak, among others, became very wealthy. Three years later, Apple Computer became the youngest company to make the Fortune 500 list of the largest industrial companies. By then, IBM had entered the field and had begun to dominate, but the Apple II’s earlier success ensured that personal computers would not be a market fad. Apple II computer[Apple two computer] Computers;Apple II[Apple two] Personal computers;Apple II[Apple two] Apple Computer

Further Reading
  • citation-type="booksimple"

    xlink:type="simple">Freiberger, Paul, and Michael Swaine. Fire in the Valley: The Making of the Personal Computer. Berkeley, Calif.: Osborne/McGraw-Hill, 1984. Freiberger and Swaine, both longtime reporters on the personal computer world, tell the story of the growth of the industry. Based largely on extensive personal interviews. Photographs, index.
  • citation-type="booksimple"

    xlink:type="simple">Garr, Doug. Woz: The Prodigal Son of Silicon Valley. New York: Avon, 1984. A slim paperback focusing on Wozniak. Unfortunately, it fails to explore his creative insights. Illustrations.
  • citation-type="booksimple"

    xlink:type="simple">Levering, Robert, Michael Katz, and Milton Moskowitz. The Computer Entrepreneurs: Who’s Making It Big and How in America’s Upstart Industry. New York: New American Library, 1984. These writers on American business provide more than a reference book, less than a complete story. A cross section of personal computing in the early 1980’s. Provides profiles on major figures in the personal computer revolution. Elementary, but informative. Illustrations, index.
  • citation-type="booksimple"

    xlink:type="simple">Levy, Steven. Hackers: Heroes of the Computer Revolution. 1984. Rev. ed. New York: Penguin Books, 2001. Levy, a well-known writer on the personal computer, tells the story of the people, often behind the scenes, who inspired the personal computing revolution. Based on extensive interviews and archives. Notes, index.
  • citation-type="booksimple"

    xlink:type="simple">Moritz, Michael. The Little Kingdom: The Private Story of Apple Computer. New York: William Morrow, 1984. The Time reporter tells the early story of Apple Computer from the corporate perspective. Based on interviews and largely anecdotal. Index.
  • citation-type="booksimple"

    xlink:type="simple">Rose, Frank. West of Eden: The End of Innocence at Apple Computer. New York: Viking Press, 1989. Freelance journalist Rose focuses primarily on the post-Jobs era at Apple, although discussion is devoted to the company’s formation. Based on interviews. Good bibliographic note. Index.
  • citation-type="booksimple"

    xlink:type="simple">Stine, G. Harry. The Untold Story of the Computer Revolution: Bits, Bytes, Bauds, and Brains. New York: Arbor House, 1985. Focuses on evolution of the computer from its beginnings. Some coverage of Apple. Photographs.
  • citation-type="booksimple"

    xlink:type="simple">Wozniak, Steve, and Gina Smith. iWoz: From Computer Geek to Cult Icon—How I Invented the Personal Computer, Co-Founded Apple, and Had Fun Doing It. New York: W. W. Norton, 2006. The autobiography of Steve Wozniak. Includes illustrations.
  • citation-type="booksimple"

    xlink:type="simple">Young, Jeffrey S. Steve Jobs: The Journey Is the Reward. Glenview, Ill.: Scott, Foresman, 1988. Young, a founding editor of Macworld magazine, provides a cogent picture of Jobs. Based on extensive interviews and firsthand knowledge. Photographs, bibliography, notes.

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