Dogfight: How Apple and Google Went to War and Started a Revolution (15 page)

*   *   *

Jobs, not surprisingly, was thrilled with how his meeting with Google turned out. Days after, he portrayed it to his executive team as a big win for all of them—that what was right and good had beaten a bunch of liars, cheats, and scoundrels. An executive who was part of that briefing said that Jobs and Forstall “were kind of gloating about it. They were like, ‘Rubin was pissed. You could see it all over his face. We got what we needed to win. And they [Google] said they were not going to do it [multitouch].’” Jobs hated Rubin and told friends he was a “big, arrogant fuck.”

None of this made Jobs less angry at feeling forced to go after Google in the first place. He felt Brin and Page, people he once considered friends, had betrayed him. And he felt Schmidt, a member of his board, had dissembled. Jobs’s message to his executive team that day was strident: “These guys are lying to me, and I am not going to take it anymore. This Don’t Be Evil stuff is bullshit.” But he also felt vindicated—that Google was no longer going to be a threat.

Schmidt, while still technically on the Apple board, was effectively no longer a board member. He was now leaving the room during all board discussions about the iPhone, which was increasingly what Apple board meetings were about. Both for appearance and legal reasons, these recusals were happening more and more at Google too. Schmidt did not attend Google Android meetings, for example, and he left the room when Android came up in other contexts, such as among fellow members of Google’s board of directors. Schmidt said he did not want to even
appear
as if he could be a conduit for information between the two companies.

Jobs told friends he was tempted to boot Schmidt entirely from the board, but he also understood that that might cause more trouble than it solved. It would attract media attention. It might spook investors. It might distract employees. Jobs may have felt that Google and Apple were no longer allies, but he knew that they still needed each other as business partners. Apple still needed Google search, Maps, and YouTube to sell the iPhone. And since no Android phone was for sale yet, the iPhone was still the only phone powerful enough to run Google’s software effectively.

In the coming months Google did little to counteract Jobs’s impression that he had thumped it—that the iPhone was going to dominate the mobile-phone world the same way that the iPod dominated the music-player world. The T-Mobile G1 phone “powered by Google” launched in September 2008. It was a good first effort, but comparing it to the iPhone was like comparing a Kia to a Mercedes. It had a touchscreen, but partially because Google had taken out all the multitouch features, it wasn’t useful. It had a slide-out keyboard, but users complained that the keys felt mushy. Few were going to dump their BlackBerry for it. And it was difficult to set up if, like most, you used Microsoft Exchange email, contacts, and calendar at work.

But the Gmail, Android browser, and Maps applications were slick, and unlike even the latest iPhone then, the G1 ran more than one application at the same time. It introduced the pull-down notification screen that the iPhone later imitated. It was much more customizable than the iPhone. However, it didn’t work with iTunes, the entertainment software of choice. You couldn’t even sync it to your computer easily, like an iPhone. Instead, to get your information from your computer to the G1, you had to let the phone sync with Google’s cloud, then sync your PC to Google’s cloud as well. That may be a virtue today, but back then, before cloud computing was mainstream, it was a hassle.

Googlers were even tougher on the G1 than consumers. That year Google gave G1s to employees instead of the standard companywide Christmas bonus. Employees were not happy about it. I asked a few back then how they liked theirs and got answers such as “Great. Do you want mine?” or “Count how many are for sale on eBay. That’s your answer.” In subsequent Friday company meetings, Googlers openly asked why the company was wasting its time with Android. Most Googlers by then had iPhones, and the comparison was laughable.

Compared to the iPhone’s unveiling, the launch, held in a catering facility under the Queensboro Bridge, was amateurish, according to Levy’s account and videos. There were no live demos, only demos on video. Too much time was taken up with boring, self-congratulatory remarks by Rubin, and executives from HTC and T-Mobile. The only sign that this project had backing from the very top of Google came when, toward the end, Brin and Page made an unrehearsed appearance together on Rollerblades. But while their presence added star power, their answers to questions did not. In response to a question about what was the coolest G1 application, Brin said he’d written an app himself that used the phone’s accelerometer to automatically time how long his phone stayed in the air when he tossed it. Then he threw the demo phone in the air to illustrate, creating looks of panic on his colleagues’ and partners’ faces. There were few other phones then, and they couldn’t afford to have one break because Brin dropped it.

Juxtaposing the G1 and iPhone launches makes you wonder how Brin, Page, and Schmidt
ever
had more than just a business relationship with Jobs. Their outlook on the world was entirely different. Apple had prospered because of Jobs’s meticulous, disciplined search for the best device—the perfect blend of form and function. Google had prospered on the backs of Brin’s and Page’s zaniness and embrace of chaos. As entrepreneurs the three shared a willingness to reject anything with a whiff of convention and to make big bets when those around them said they were reckless. But that’s where the similarities ended.

Brin and Page wound up in front of the media in Rollerblades because they had been at an event with New York’s Governor David Paterson at Grand Central Terminal in the morning and thought blading would be a fun and faster way to bypass New York City’s gridlock. It didn’t matter to them that a car was waiting, that their security detail had planned for traffic, or that they ended up at the G1 launch looking grimy and sweaty. Brian O’Shaughnessy, Android’s top public relations aide at the time, says he remembers having to keep his own emotions in check when they arrived. It was his job to make sure the G1 got the widest and most positive media attention possible, and he wondered how to explain to his billionaire founders that they were putting everything at risk. “I was waiting for them backstage when they got to the launch, and I said, ‘Guys, don’t you want to take your Rollerblades off? You’re going out there with the CEO of HTC and T-Mobile executives,’ and they said, ‘No. No. It’s going to be fine.’ And they just rollerbladed onto the stage.” Can you imagine Steve Jobs ever doing that?

*   *   *

The way Jobs was handling Google should have made everyone at Apple feel better about the tension between the two companies. Instead, it made many of them feel worse. A handful of executives and engineers had been warning Jobs about Google’s ambitions with Android for two years, and they
still
believed Jobs was underestimating Google’s resolve. Why had the great Steve Jobs allowed himself to be duped by Google in the first place, and why did it then take him another eighteen months—until early 2010—to respond publicly? One of them put it to me like this: “I kept telling him, ‘Steve, we should be paying more attention to those guys. They’re hiring like crazy and I know all the guys they are hiring.’ But Steve was like, ‘I’m going to have my walk [with Larry or Sergey or Eric] and I’ll get to the bottom of this.’ Then he’d have his meetings with them and come back and say they told him not to worry. ‘It’s not really serious. It was an interesting idea, but it’s not going anywhere,’ they’d tell him. Even when Android shipped in 2008, they told him, ‘Well, it’s not really stable. It’s not great. We don’t know if we are going to continue it.’ And I was just like, ‘I don’t believe this is happening.’”

Another recalled his and his colleagues’ panic in 2007 when Google’s Schmidt and the rest of the Apple board got iPhones to carry around months before they went on sale: “You have to know that there were a lot of people at Apple working on the iPhone going, ‘What the fuck? They are handing our phone to a guy in charge of a company that we’re competing with. They’ll take the phone, tear it apart, and steal all our ideas.’”

Some at Apple have speculated that Jobs’s blindness could simply have been because of what he considered his great friendship with Brin and Page. It is human nature to believe we are good judges of character. Successful founders and CEOs such as Jobs think they are particularly good at it. Being able to find and hire the most talented, reliable, and trustworthy people is, after all, a critical part of building and running a successful company. But others also wonder if Jobs’s cancer had started to become a factor by then too. By the middle of 2008 Jobs was obviously not well. Most of the time his voice was strong and his energy was good—but he looked emaciated, as if he had lost fifty pounds in six months. At times he was also obviously in pain. “I’d see him double over in meetings. I’d see him get in a corner and just sit there with his knees pressed against his chest. We’re all in the executive boardroom. It was terrifying to watch,” an executive said.

No one asked if Jobs was sick, even though his appearance had become the elephant in the room in most meetings with him by 2008. “We never wanted to admit it. We just didn’t go there. You just don’t do that to somebody. You wouldn’t want it done to you. And he would always say, ‘Don’t worry. I just got cleared by the doctors’ or ‘I’m fine,’” one executive said. But no one knew then what everyone knows now—that Jobs was not only sick but terminally ill. His pancreatic cancer had spread to his liver, and he needed a transplant, which he got when he was near death in early 2009, according to Walter Isaacson’s 2011 biography of Jobs. Now some who were in those meetings with him back then wonder if his illness wasn’t starting to take the fight out of him. “Put yourself in Steve’s shoes,” said one. “You’re sick, and some days you’re just irritable, but on others you say, ‘I give up. I’ve heard what I need to hear. Let’s move on.’”

Another Jobs confidant thinks Jobs was simply blinded by overconfidence. “I just don’t know that anybody really focused on the fact that there was going to be a full-fledged licensed operating system that they [Google] were going to provide to manufacturers. There were a lot of rumors about a phone and about how they were going to do a phone OS; but I don’t think Apple gave two shits about that because I think they felt that they were so good and so far ahead of everyone else that it didn’t matter. So if they [Google] were going to do a Nokia-like OS or something like that, nobody was going to worry. [Even in 2008] I don’t think anybody focused on that fact—that this was going to be a knock-down, drag-out Apple competitor.”

This person initially rejected Jobs’s health as being part of the problem. Upon further questioning, however, he reconsidered and said, “Look, I think you’re right. Would he have been more combative during that period [if he hadn’t been sick]? Probably, yes.”

*   *   *

As in any divorce, Googlers and Appleites may never agree on how the two started fighting, at what point Apple began cutting business ties with Google and why it is now spending hundreds of millions of dollars suing members of the Android community around the world. Was Jobs truly betrayed by allies who shamelessly copied his work, as Apple still alleges years after Jobs’s death? Or is Apple just perpetuating a cover story to hide the fact that illness and/or personal relationships, and/or overconfidence, had allowed him to miss signs that his relationship with Google was changing? Was Google sucked into fighting with Jobs when all it really wanted was to find a way to get along? Or was its behavior more premeditated and nefarious?

What
is
clear is that after Jobs forced Google to capitulate to him in the summer of 2008, Google privately began dropping all pretense of friendship too, and with single-minded ferocity it focused its energies on competing with Apple. Throughout the winter of 2008 and spring of 2009, as Jobs took a six-month leave from Apple for a liver transplant, Google didn’t just invest heavily to build a second Android phone—the Droid—but started working on a third Android phone it would design, market, and sell itself. More immediately, Gundotra geared up his mobile-software team to build an iPhone app that Google might use as a Trojan horse.

Gundotra’s falling-out with Jobs earlier in 2008 had, by the end of the year, made him a staunch Android ally, and he focused his team on not only building basic Google apps for the iPhone—such as search, Maps, and YouTube—but on developing a mobile version of software called Google Voice. Like Android, Google Voice grew out of the acquisition of a start-up in August 2007. The company, GrandCentral Communications, seemed like a weird purchase at first. It was like Skype. It made software to enable telephone calls that traveled over the Internet instead of via a telephone company. But to many Google engineers that was like owning a fancier buggy whip. Telephone conversations were something their parents did. To them it was old, increasingly obsolete technology. When Google had moved to its current office complex, Brin and Page had looked into not installing telephones at all—until they were told that would be a violation of the fire code.

GrandCentral’s internal sponsor at Google, Wesley Chan, saw its potential differently: Google Voice was like Gmail. It was yet another application that made Google the center of users’ world, another application that gave Google information about those users’ interests, another application that could help Google sell more advertising. According to Levy’s book, Page liked the disruptive potential lurking within GrandCentral’s software. It could run on Android, and the carriers were not innovative enough to offer it to their customers. It offered the possibility of making Google a stealth phone company.

Google started rolling GrandCentral out to new users in 2008 under the new name Google Voice. The premise was powerful: Consolidate the various telephone numbers and email addresses we use into one communcations hub that anyone could set up. Google issued you a single phone number. You then linked that to all your other phones. When someone dialed your Google Voice number, the software automatically forwarded the call to all of your other phone numbers (or as many as you said it should) for free. It kept track of all those numbers and synced them with names in your Gmail contact list. It transcribed voice mails—albeit badly—and emailed them to you. It stored your cell phone’s text messages. It offered free conference calling that anyone could set up. Phone companies offered some of these services too, but they often cost money and were harder to set up. Gundotra believed that Google Voice would be particularly useful as an iPhone application. Not only would it add features that the iPhone did not yet offer, but it would essentially wrest the most important functions of the iPhone—calls, contacts, and email—away from Apple and, instead, connect them to Google’s servers.
Hostile takeover
is Wall Street terminology. It is hardly ever used in Silicon Valley. But when you cut through all the engineering subtleties, that is exactly what Google was doing.