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Apple Chief Steps Down

Troubled company%squots board of directors said to be unhappy with financials.

By Jeff Walsh, PCWorld   

Steve Jobs, one of Apple%squots founders, will have an expanded role in the company, focusing on product strategy, marketing and sales strategy, and business partnerships, a company official said. However, Apple officials would not speculate on whether Jobs was considering taking the CEO slot.

The announcement came as the company was preparing for the release of its feature-rich MacOS 8 at the end of July and the MacWorld trade show in Boston in early August.

Apple%squots chief financial officer and executive vice president, Fred Anderson, will assume the day-to-day operations of the company while the search for a CEO begins. Anderson said the board had not been happy with Apple%squots recent financial performance. He said there were no plans to attempt to sell Apple.

Apple%squots quarterly financial results are due to be released July 16. Amelio had said the company would be profitable by the end of the year.

When asked if Apple would meet that profitability goal, Anderson said Apple is %dquotout of the business of predicting when this company will return to profitability.%dquot

The former CEO of National Semiconductor, Amelio has been criticized from the day he was hired for the job in February 1996. Amelio led Apple%squots purchase of Next from former Apple guru Steve Jobs and devised the strategy to merge the two companies%squot operating systems in Apple%squots forthcoming Rhapsody operating system.

%dquotAmelio is confused, out of breath, over his head, gears stripped, without grounding. He has no power within Apple,%dquot Apple developer Dave Winer wrote Wednesday morning in his regular DaveNet e-mail post.

%dquotAmelio was the wrong choice to lead Apple. He had no grounding in the software business,%dquot Winer wrote. %dquotHe delayed in cutting losses in failed technologies. These were minor gaffes compared to the decision to bail out Next%squots creditors and assume their already-bankrupt strategy. Apple shareholders are going to pay dearly for this decision. It%squots the sure road to bankruptcy for Apple.%dquot

Other analysts said taking the helm at Apple is going to be difficult for anyone.

%dquotI think it%squots a difficult situation for anyone, and now it will be doubly hard to move into that role,%dquot said Mike McGuire, an analyst at Dataquest, in San Jose, Calif.

Winer also noted that Jobs was not and is not Apple%squots savior.

%dquotJobs was the wrong person to choose to turn around Apple because that isn%squott what he wants,%dquot Winer wrote. %dquotHe wants to turn around Next. And he%squots willing to lose Apple to do it. Jobs calls the shots at Apple, Amelio has no power. Eventually, I expect a bankruptcy and a shoulder shrug from Jobs as he leaves. %squotI tried,%squot he%squotll say.%dquot

During an afternoon press conference, Executive Vice President of Marketing Guerrino De Luca reaffirmed the company%squots commitment to the Rhapsody platform.

Amelio replaced Michael Spindler, who oversaw the transition to the PowerPC but was unable to effectively forecast demand or gain employee loyalty.

Amelio, 54, joined Apple%squots board of directors in 1994 and led National Semiconductor through a financial transformation that resulted in record earnings for the last two years of his reign, according to his biography on the Apple Web site.

An Apple representative said the company will honor Amelio%squots employment contract, but would not go into details about how much Amelio will still be paid by Apple.

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