Steve Jobs and Michael Dell Interview Transcript

Steve Jobs and Michael Dell recently met infor­mally over lunch to have a chat with­out han­dlers, press or invest­ment bankers. Dell reached out to Jobs with the idea of the meet­ing and Steve gra­ciously accepted the invi­ta­tion. Michael and Steve felt a kin­ship in that both were founders and pio­neers in the tech­nol­ogy busi­ness who returned to run their respec­tive com­pa­nies dur­ing times of turmoil.

As good for­tune would have it, we were sit­ting at a table nearby and were able to cre­ate a rough tran­script of their con­ver­sa­tion, unbe­knownst to either of them. Here’s what we heard.

MD: Hi Steve. Con­grat­u­la­tions on all your recent suc­cess. Thanks for tak­ing the time to meet and talk.

SJ: My plea­sure, Michael. I was happy to see that you stepped back into run­ning Dell. Your replace­ment was mak­ing a real mess of it there.

MD: Yeah, it was a dif­fi­cult deci­sion since I hand­picked my suc­ces­sor, but my name is on the box, after all. There is no ques­tion many mis­takes were made after my depar­ture as CEO. How­ever, we still have a healthy core busi­ness that peo­ple don’t really give us credit for and I’ve still got a great deal of energy and expe­ri­ence to bring to the com­pany to get it back to promi­nence in the indus­try. I see you’ve done an exem­plary job of cre­at­ing a media halo for Apple since your return.

SJ: Halo?! I wouldn’t call it that! They jumped on us for using DRM in iTunes, for “steal­ing” the iPhone name from Cisco, for using AT&T as our car­rier and for reduc­ing prices too quickly. It’s mur­der out there!

MD: Come on, Steve, it’s just us here!

SJ (grins): Well okay, so peo­ple are in love with Apple again. Who can blame them? Have you tried our machines? (grins some more)

MD: I only use com­put­ers that I build myself. That’s how I got here.

SJ: Well then, why are we hav­ing lunch?

MD: Steve there’s no ques­tion Apple is on a roll. But there’s much more to do and Apple isn’t well posi­tioned every­where. I’m think­ing we might be able to help each other.

SJ: If you’re talk­ing about tak­ing over our hard­ware busi­ness like those geniuses at Gart­ner Group sug­gested in 2006 you are out of your mind. And don’t take it the wrong way but I don’t think our stock­hold­ers would be enthu­si­as­tic about a closer asso­ci­a­tion with Dell.

MD: Steve, I’m talk­ing about much big­ger things than mak­ing boxes; that’s done. We are at the begin­ning of a huge invest­ment cycle that will be the result of the shift to cloud com­put­ing but also the con­ver­gence of the real and vir­tual world. More Apple stores will be vis­ited by real peo­ple in vir­tual space rather than on 59th Street.

SJ: What do you think the iPhone is about? It will rev­o­lu­tion­ize how we live, work and play. At least a mil­lion peo­ple see this already but more don’t yet real­ize it. The oper­at­ing sys­tem, inter­face and the mas­sive appli­ca­tion base that will emerge will change the way we inter­act with the online world in our daily life. We’re just scratch­ing the sur­face with our tech­nol­ogy. We’ve got a lot of great ideas and patents in the pipeline. Ten years ago the Black­berry was a spe­cial­ized niche prod­uct. Now many peo­ple spend more time with their Black­berry than their com­puter. We’re going to pass RIM like they are stand­ing still. It’s the key wedge that will sep­a­rate enter­prise users from Microsoft. Once that hap­pens, it’s a free-for-all and we win big.

MD: That’s exactly on the path of where we are going. Apple is a strong posi­tion in the mobile and client space. But the heavy lift­ing is set to go on by the servers, stor­age and net­works that enable very pow­er­ful cloud-based ser­vices. More real inter­ac­tion is shift­ing to vir­tual worlds. The com­pute power and soft­ware required for this is an immense busi­ness opportunity.

SJ: We sell servers and online ser­vices! And we under­stand how to deliver tech­nol­ogy and enter­tain­ment ser­vices like iTunes, AppleTV and MobileMe. Any­way, isn’t Google going to han­dle all that? Why would I want to com­pete with them?

MD: You may not have a choice Steve. You’re going to find your mar­ket lim­ited if you allow them to own cloud-based tech­nol­ogy ser­vices. Besides they clearly have their own vision of the mobile inter­net and are try­ing to drive Android into the pic­ture. Not to men­tion the fact that after years of effort you’re still strug­gling with MobileMe.

SJ: My staff gives me brief­ings on all this stuff every day. At least you didn’t bring up Adobe; those guys bug me. We’re doing extremely well, the iPhone is a Tro­jan horse and we have a great pipeline of new prod­ucts. What exactly are you talk­ing about doing? (a lit­tle exasperated)

MD: It’s still early days in these mar­kets Steve. Although the spot­light today is on the con­sumer space, the wave of enter­prise adop­tion is going to be huge. Google still has a small foot­print in the enter­prise. We are big there in both sys­tems and stor­age. You are largely absent from the high end gam­ing mar­ket but Dell is there. While Microsoft, Sony and Nin­tendo fight for the con­sumer mar­ket in gam­ing we can own the next gen­er­a­tion of inter­faces, inter­ac­tiv­ity and appli­ca­tions in the enterprise.

SJ: We’re mak­ing progress in the enter­prise. Some very large com­pa­nies are start­ing to roll out the iPhone now. That’s the first domino to fall and then we can infil­trate the base.

MD: Surely but too slowly. Indus­try data sug­gests that an amaz­ing 25% of enter­prises want to incor­po­rate Apple hard­ware but only 8% have plans to do so. That’s a lot to leave on the table.

SJ: But we will be get­ting them faster than they think. Those num­bers keep mov­ing up. Of course, we’d love to have the full 25% that want to have Apple be able to do it. What’s stop­ping them?

MD: These guys aren’t buy­ing com­put­ers to orga­nize their music libraries and photo albums. (smiles)

SJ: Very funny. We make very pow­er­ful sys­tems and do have large enter­prises run­ning on our infra­struc­ture. Many of the cre­ative indus­tries have long had us as their standard.

MD: Steve, that’s true but I’m talk­ing about com­pa­nies like Fed­eral Express, Citibank, GE and the rest of the global 5000. Many are installing the most advanced com­put­ing infra­struc­ture in the world. But they need sup­pli­ers who fit with their busi­ness prac­tices and oper­at­ing model; deliv­ery, sup­port, esca­la­tion pro­ce­dures, inter­op­er­abil­ity, man­age­ment and a raft of things that require a focused approach. It’s some­thing that we know well and rank near the top of the field.

SJ: Yeah okay so we can be more cor­po­rate. We know that. It’s not like we aren’t mov­ing in that direc­tion. We pre­fer to do it with rad­i­cal new offer­ings like than iPhone rather than play­ing golf with executives.

MD: These days your golf game doesn’t really enter into it. Many of the big deals in the space are even done via auc­tion. It’s a tough busi­ness but we know how to do it as well if not bet­ter than most of the play­ers. In addi­tion we’ve been invest­ing heav­ily in tech­nol­ogy that can run the mod­ern inter­faces and appli­ca­tions that you see in games today but will increas­ingly be a com­mon fea­ture in the enter­prise. At the same time we are expand­ing into the SaaS and social com­put­ing space in the IT space.

SJ: I appre­ci­ate your prowess in some of these related areas but it doesn’t trans­late into why we should be work­ing together. We have been work­ing on quite a bit of this our­selves and you know there are other com­pa­nies out there like IBM and Hewlett Packard that you may have heard of. (smiles)

MD: We over­lap in some key areas, more so than we did in 2006 now that Apple is on Intel. We also com­ple­ment each other very well. There’s a Yin and Yang here that could make up a potent whole.

SJ: I’m not Yin, and sure as hell no Yang. I hate all that cor­po­rate enter­prise crap. Reminds me of guys like John Scul­ley. (winces, then drinks some water as if to wash a bad taste out of his mouth)

MD: Dell could help inte­grate Apple into the next-generation of enter­prise infra­struc­ture. It’s going to be a big wave of invest­ment that will embrace not just service-based or cloud com­put­ing but also vir­tual real­ity. It’s going to have a dra­matic effect on busi­ness. As part­ners we could do way more, much faster than com­pa­nies like HP, IBM or Cisco even though they have a lead in some areas.

SJ: Yeah, I’m still listening.

MD: We’d have to work out the details, but my idea is to become the enter­prise arm of your busi­ness. We would work closely with com­pa­nies who want to incor­po­rate Apple to pro­vide the pieces they need. We’d also incor­po­rate Apple tech­nolo­gies into our high-performance and cor­po­rate cloud com­put­ing solu­tions. And we would both work together to pio­neer vir­tual stores in places like Sec­ond Life.

SJ: Okay so tell me Michael, what’s in it for Dell? And why do you think Apple should be interested?

MD: First of all we’d be sell­ing your great com­put­ers. (smiles slightly sar­don­ically) But seri­ously it would serve to fur­ther dif­fer­en­ti­ate us from tra­di­tional enter­prise ven­dors like HP, IBM or Sun. Sec­ondly it gives us a way to par­tic­i­pate more in the mobile inter­net space which is where most of the growth on the client side is going to be. I can cer­tainly see the dis­rup­tive power of the iPhone and how it could well eclipse other offer­ings, but to do so it will need to do well in the back office of large com­pa­nies, not just in the hands of a user. Lastly I think we are both lead­ers in what we do best but are fac­ing some seri­ous com­pe­ti­tion from the old guard. Together we can shake things up and bring them down more quickly.

SJ: Inter­est­ing. Go on.

MD: And it’s no secret that vir­tu­al­iza­tion is now an enter­prise strat­egy. Apple is now on Intel chips which means that the Win­dows OS and other com­po­nents can run eas­ily on any Apple HW. Of course I’d also like to get Apple SW com­po­nents inte­grated on Dell HW. Doing so would mean a much big­ger oppor­tu­nity for Apple SW inside the cloud.

SJ: Alright, alright I can see that we may have some­thing here.

MD: We can let Sony, Microsoft and Nin­tendo have the game con­sole in the home but we can’t leave the busi­ness mar­ket to them. As more activ­ity moves online into vir­tual worlds we need to be there to cap­i­tal­ize. The servers, stor­age, ser­vices and soft­ware should all be Apple/Dell.

SJ: You’ve got our names in the right order there. (smiles) We actu­ally have some work and patents in the immer­sive vir­tual space around shop­ping that we picked up years ago. But until now there hasn’t been much of a mar­ket. We launched AppleTV because at least the video mar­ket is real.

MD: These things grow slowly for a long time and then all of a sud­den they’re huge. We’re see­ing real move­ment now and there are signs of what the future world is going to be. Look at the amaz­ing suc­cess of devices like the Wii, the growth of social com­put­ing and online com­mu­ni­ties. These ele­ments are com­ing together now. IBM and Cisco are already very active and invest­ing here.

SJ: It would be a shame to let a big oppor­tu­nity like this slide by.

MD: Let’s con­sol­i­date our indi­vid­ual strengths into a pow­er­house. Apple is the only player who has major posi­tions and assets in soft­ware, the mobile inter­net and online enter­tain­ment. Dell brings the enterprise-class capa­bil­ity along with scale, stor­age solu­tions, online ser­vices and immer­sive com­put­ing. We can exploit the move­ment to vir­tu­al­iza­tion and the cloud to mar­gin­al­ize the impact of com­peti­tors like Microsoft, Research in Motion, Hewlett Packard and IBM. Maybe we will also be able to keep the great Google at bay.

SJ: For a guy who still knows how to use a sol­der­ing iron you have some good ideas. (smiles)

MD: We’ve both come a long way Steve. We’ve also both got much far­ther to go. (smiles back)

[This inter­view is purely fic­tional and has been pro­duced purely for enter­tain­ment pur­poses. Any resem­b­lence to an actual con­ver­sa­tion between Steve Jobs and Michael Dell in the past or the future is purely coincidental.]

Tagged as: Apple, Dell, Management