Imagine a technician a company so visionary that it can last idea public. They called it a “conceptual public offering.”
Imagine three founders, all former Apple employees, two of whom – software engineers Andy Hertzfeld and Bill Atkinson – were already Silicon Valley legends for their work on the Apple Macintosh computer. Atkinson’s prolific inventions include double clicking and drop-down menus. The third founder, Marc Porat, had the gift of seeing the future.
In his doctoral dissertation at Stanford University in 1976, Porat analyzed in detail (painstakingly) a century of transformation of the American workforce and predicted radical changes in work. An economy based primarily on the processing of matter and energy – through agriculture and industry – is giving way to an economy based on information processing. He noted that computers and telecommunications are changing every industry. “We are entering the next stage in economic history,” Porat wrote. On the first page of the first chapter of his dissertation, Porat coined a term that became notable: “information economy.”
Porat then hosted a primetime PBS documentary called Information Societyin 1980. He positioned information technology as disruptive on a scale comparable only to the plow and the steam engine. He delved deeply into the power of modern technologies, as well as emerging issues of privacy, information overload, misinformation and rising inequality, and showed that most Americans had no idea the ground was shifting beneath them.
In 1988, Porat joined Apple’s Advanced Technology Group, where he was able to apply his extraordinary foresight to the team’s task of figuring out what would be the next substantial thing after personal computers. One day, Porat took Acute Wizard – a modern electronic calendar and phone book organizer – and taped it to an analog Motorola cell phone. He had his own idea. Soon he was making plaster models of a cell phone and a digital assistant. In 1989, in a enormous red notebook, he drew a visionary product that matched the future he predicted with incredible accuracy. He called it the Pocket Crystal. You don’t have to have seen a sketch before for it to be immediately familiar.
The Pocket Crystal diagram showed a skinny glass rectangle with no protruding buttons – just a touchscreen. This would be a computer that was a combination of telephone and fax; you can operate it to send text messages, watch movies, play video games, buy plane tickets and download modern apps. It would fit in your pocket and be lovely. Following the sketch, Porat wrote in his Red Book: “It must provide the kind of personal satisfaction that good jewelry brings. It will have perceived value even when not in use. It should provide the comfort of a touchstone, the tactile satisfaction of a shell, and the charm of a crystal.”
Only in 1989 15 percent of American households even had a computer that didn’t fit in anyone’s pocket; zero percent browsed the web because it didn’t exist. And yet there was Marc Porat, essentially sketching the iPhone.
The project was given the green delicate, but with a caveat: it was too substantial, even for Apple.
Early users simply talked on brick-shaped cell phones. Pocket Crystal would require not only unprecedented hardware and software, but also networks connecting the world and modern standards of digital communication.
In 1990, Porat and Apple CEO John Sculley agreed that Apple would invest and take a seat on the board, but that the project would become a separate company and seek partners. For this modern venture, the founders chose a name that brings to mind both the country’s most respected companies and science fiction writer Arthur C. Clarke’s dictum that “any sufficiently advanced technology is indistinguishable from magic.” Thus, General Magic was born.
Sculley introduced the founding trio to Sony. They made an offer and after a few days Sony joined the proposal, offering shares and a licensing agreement. Next was Motorola, then AT&T. In quick succession, the world’s telecommunications titans and consumer electronics giants were persuaded to join the so-called “Alliance.” Next came Philips, and then Sony’s fierce rival Panasonic (then known as Matsushita). Then NTT (Japan’s largest telecom operator), then Toshiba, then France Telecom and so on, each investing millions of dollars. General Magic’s partners controlled so much of the global telecommunications industry that Alliance meetings had to begin with an antitrust lawyer presenting a list of all the topics they were not allowed to discuss. It was, as General Magic’s general counsel put it, the largest consortium of global companies ever to exist in American business.