Internal NeXT video (1991)

Summary

In this chalk talk, Steve Jobs discusses Next's strategy for targeting the emerging professional workstation market, distinct from both traditional workstations and personal computers. He highlights the growth of this market, driven by professionals needing advanced development environments, networking capabilities, and custom applications. Jobs outlines how Next’s competitive strengths—superior development tools, better productivity apps, and enhanced interpersonal computing—position the company to outpace competitors like Sun. He emphasizes the importance of listening to customers and continuously refining the product offering to meet their evolving needs and secure a dominant market share.

Takeaways

• 😀 The target customer for the company's professional workstations is expanding beyond traditional scientists and engineers, now including professionals from diverse fields like publishing, healthcare, legal, and more.
• 😀 The company faces significant competition from Sun Microsystems, which dominates the professional workstation market, but there is room for growth and market share expansion.
• 😀 The professional workstation market is expected to grow significantly in the coming years, with projections indicating a doubling of units in 1991 and tripling by 1992, representing a substantial opportunity for the company.
• 😀 The company’s competitive advantage lies in its superior development environment, which allows customers to build custom applications much faster than with competitors' systems.
• 😀 Networking capabilities are a critical factor for customers moving into the professional workstation category, as these systems need to handle sophisticated networked applications.
• 😀 Customers are increasingly demanding workstations for database-driven applications, which require powerful desktop systems that can seamlessly connect with mainframes or other large servers.
• 😀 The company sees Sun as a key competitor but also acknowledges that their marketing efforts could help expand the market, which would eventually benefit both companies as they convert more customers to professional workstations.
• 😀 The company's strategy focuses on not just winning on hardware and performance, but also by offering superior productivity apps like Lotus Improv and WYSIWYG WordPerfect, which make their workstations more attractive to customers.
• 😀 Interpersonal computing is emerging as a key differentiator, with the company positioning its workstations as superior in collaboration and group productivity through advanced multimedia features.
• 😀 The company aims to create an environment where, as customers evaluate professional workstations, they consistently compare their products with Sun, ensuring that both companies are competing for the same orders.
• 😀 A key part of the strategy is educating customers on the benefits of custom applications, productivity apps, and interpersonal computing to increase awareness and shift customers from legacy systems (PCs, Macs, mainframes) to the company's more powerful workstations.

Q & A

What is the primary goal of this chalk talk by Steve Jobs?

The primary goal is to inform the team about the target customer for their workstation products, explain why customers are choosing their products over competitors, and outline the distribution channels they will use to reach those customers.

What was the major challenge faced when identifying the target market for their products?

The major challenge was determining whether their products should compete with workstations or PCs, as their products share features with both categories, including multitasking and networking capabilities.

What key revelation did the team make about the workstation market?

The key revelation was that the workstation market is not a single market but two segments: the traditional scientific/engineering segment and the emerging professional segment, which includes industries like publishing, medical, and legal.

How large is the professional workstation market expected to grow?

The professional workstation market is expected to grow from 50,000 units in 1990 to 100,000 units in 1991 and then to 300,000 units in 1992.

Why is Sun Microsystems considered both a competitor and a helpful ally in this market?

Sun is seen as a competitor because they dominate the professional workstation market. However, Sun is also indirectly helping by marketing the professional workstation category, which leads customers to consider the company's products as alternatives.

What are the primary factors driving the growth of the professional workstation market?

The market is growing due to customers moving from PCs and Macs to workstations for more sophisticated networking and development environments, as well as users shifting from mainframe terminal emulators to desktop workstations for more efficient application development.

What are the three key reasons customers are moving into the professional workstation market?

The three key reasons are: 1) The need to develop custom applications, 2) The desire for better productivity applications, and 3) The increasing importance of interpersonal computing for group productivity and collaboration.

How does the company plan to differentiate itself from competitors like Sun?

The company plans to differentiate by highlighting its superior development environment, better productivity applications, and stronger interpersonal computing features, which are all more advanced than what Sun offers.

What role does customer feedback play in shaping the product's development?

Customer feedback is crucial in refining the definition of the professional workstation market and ensuring the product meets the real needs of the customers. The company has been actively gathering and analyzing customer insights to enhance its competitive position.

Why does Steve Jobs emphasize the importance of the software camp for developers?

Steve Jobs emphasizes the software camp because it allows developers to experience firsthand how the company’s development environment is vastly superior to competitors, specifically Sun, helping to solidify the company's advantage in custom application development.