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Steve Jobs’s real genius wasn’t ‘great design’

JP Mangalindan
Chief Tech Correspondent

Steve Jobs has been lauded for many accomplishments — innovative design, the revival of Apple (AAPL) — but according to Mark Leslie, founding chairman and CEO of Veritas Software, Jobs’s true genius was his knack for revolutionizing markets.

“Everybody thinks that Apple’s success is about great design and Steve Jobs being like, ‘make the font [bigger or smaller]’ or ‘just take out that pixel,’” explained Leslie, who lectures at Stanford Graduate School of Business. “That’s what they think of Apple, that perfection in design. I don’t perceive Apple that way.”

Instead, he pointed to devices like the iPod — not its industrial design, but the way it helped reimagine music distribution and storage. When the iPod was announced in October 2001, it had a “good design,” but it was, objectively, one mp3 player in a veritable sea of mp3 players. What really made the iPod stand out from the pack was iTunes.

“Jobs went out and he convinced all these guys to sell a song for 99 cents instead of an album for $12 or $14,” Leslie recalled. “That was hugely disruptive.” Source: Yahoo Finance

“People could download a song that they liked instead of having to create mp3s and load them up on their mp3 device,” Leslie recalled. “Jobs went out and he convinced all these guys to sell a song for 99 cents instead of an album for $12 or $14. That was hugely disruptive. That single act of restructuring the music industry is what made the iPod.”

Apple’s other hugely disruptive device? The first iPhone, which Jobs debuted onstage in 2007. Since then, Apple’s wildly popular smartphone line has gone on to sell over 1.2 billion phones worth $738 billion, according to Statista.

“He builds this device, and he builds this app store, and he goes around to talk to all these guys to say, ‘hey, why don’t you take my product and let me sell these apps and get rid of all your stuff and you’ll get market share,’” Leslie explained.

Indeed, as it’s now widely known, nearly every phone carrier Jobs approached at the time initially balked at the prospect of partnering with Apple, save for AT&T (T). In order to make that deal happen, Apple initially agreed to sell the iPhone with AT&T as its exclusive carrier for up to five years. It wasn’t until 2011, that other carriers, including Verizon (VZ), also started selling iPhones.

“Think about that in business: giving away a five-year exclusive has to be the most painful thing you can possibly think of. But at the end of the five years, everyone had to buy iPhones. So his genius — his real genius — was restructuring the industries and having the insight into business models.”

JP Mangalindan is a senior correspondent for Yahoo Finance covering the intersection of tech and business. Email story tips and musings to jpm@oath.com. Follow him on Twitter or Facebook.  

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