Why Apple Shouldn't Renew Newton

The handheld market is one that Apple has already proved it can't master. Still, Jobs & Co. has a key role to play there

By Charles Haddad

Apple is the Dr. Frankenstein of handheld computers. Its Newton, stitched together from several emerging technologies, was the first commercial handheld computer when it was released in 1993. But like Frankenstein's own creation, Newton was ridiculed and taunted.

Why? Well, contrary to popular perception, most great innovations are shunned at first, and Newton was years ahead of the market. But it's also true that Newton was fatally flawed. It had the feel, both in size and weight, of an electronic brick. You could barely hold it in your hand, and it couldn't connect with the rest of the computing world.


  When Apple Chief Executive Officer Steve Jobs pulled the plug on Newton in 1996, it was a mercy killing. That's harsh, I know, and my assessment will anger some. Like the star-crossed Amiga, Newton retains a long-suffering following. Ever since its demise, enthusiasts have called for Jobs to resurrect Newton or some new incarnation of it.

Two weeks ago, an important new voice joined in the chorus. He's Pat Dorsey, director of stock analysis at Morningstar.com. Dorsey told Web news site ON24 that "Apple has been a handheld manufacturer, it seems logical that this is a market it may want to reenter." Sorry, Pat, but I must respectfully disagree. It would be a big mistake for Apple to try the handheld market again with its own device.

To think Apple could swagger into this highly competitive arena and take meaningful market share is based on a false assumption. Just because Apple makes dynamite PCs doesn't mean it could do the same with other computing devices. That's like saying Palm or HandSpring could suddenly make a winning PC. Indeed, Apple's history suggests otherwise. Newton isn't Apple's only failure outside PCs. How soon we've forgotten the sad chapter of Pippin, a thankfully short-lived attempt by Apple to build an interactive-TV device.


  And what about the eMate? I bet Mac users don't even remember the portable computer designed for students. Ah, I already hear enthusiasts countering, "But the handheld market is different. Rather than build its own handheld from scratch, Apple could buy into the market." A prime target would be HandSpring, the surging maker of the Palm-based Visor. Sure, Apple could do that, and I could buy a Gulfstream Jet. That doesn't mean I'd know how to fly it.

Buying companies outside your area of expertise is a tricky and time-consuming business. Silicon Valley is littered with the remains of such efforts. Dare I say Netscape is a prime example, with Steve Case failing to retool Navigator into a strong competitor to Net portal Yahoo!. As has happened so many times before, Netscape's leadership, including co-founder Marc Andreessen, jumped ship. Netscape became a shell of its former self.

The same could easily occur at an Apple-controlled HandSpring. Don't forget that HandSpring's founders Jeff Hawkins and Donna Dubinsky bailed from Palm when it was spun off from 3Com.

The lesson here is clear. Apple should stick to its knitting, digitally speaking. Jobs needs to concentrate now on shoring up his core PC market in a slumping economy. It's also critical that Apple wins back leadership in the education market. And it's better not to refight battles already lost.


  Apple's research-and-development money would be better spent figuring out how to jump ahead to the next curve on the Information Superhighway. That's not to say Apple can't play a pivotal role in handheld computing. The company must ensure that its computers work seamlessly with every handheld device. Right now there's plenty of room for improvement.

I hear scores of complaints about Visors and Palms failing to work for one reason or another with the various Mac personal information managers (PIMs). I wouldn't be surprised if Apple announced sometime in the not-too-distant future an "iTunes" equivalent of handheld connectivity software. Such software would simplify connectivity with handhelds while expanding their power.

This is one way Apple could jump ahead of the curve, and doing so would be in step with Jobs's strategy of making the Mac a hub for all other digital devices. The day will come -- and Apple will be in the forefront I'm sure -- when advances in chip technology reduce most PCs to the size of a pack of playing cards. Until then, I'm afraid, Apple handheld advocates will have to be content fondling their aging Newtons.

Haddad, Atlanta-based correspondent for BusinessWeek, is a long-time Apple Computer buff. Follow his weekly Byte of the Apple column, only on BW Online

Edited by Beth Belton

Before it's here, it's on the Bloomberg Terminal.