AS STEVE WAS so fond of saying at the end of his meticulously stage-crafted keynote speeches, there was “one more thing” in 2003. In the late summer, he passed a kidney stone and went to the doctor for an ultrasound follow-up, to ensure that there weren’t more. In forty-nine years, Steve had never had any serious medical conditions, and when a urologist saw a shadow on the ultrasound and called to urge him to come in for a follow-up visit, he ignored her request. To her credit, she harangued him, and, finally, he returned to see her in October for what he figured would be a routine scan. The results were shocking: he had what appeared to be a cancerous tumor on his pancreas, a scary prognosis that often means the victim has just a few months to live. The next day brought news that what Steve actually had was a slower-growing, more treatable condition—something called a pancreatic neuroendocrine tumor. Both he and Laurene heaved a half-sigh of relieve. But the emotional see-saw of the two days had been exhausting. It was only the beginning of a slow-motion process that would ultimately prove to be beyond Steve’s control. And it came at the very moment when his efforts to will his company to success were finally starting to pay off in unimaginable ways.

Chapter 12

Two Decisions

Steve was presiding over a sprawling, growing business that was becoming more demanding by the day. In 2003 and 2004 alone, for example, Apple upgraded its entire product line. The four-quadrant structure still applied to personal computers. Consumers looking for a desktop computer were treated to the transition from the whimsical “sunflower” iMac G4, whose sleek flat-screen monitor swiveled on a post that rose from a bubblelike computer case, to bigger iMac G5s, slablike affairs that packed their entire computing innards behind a flat screen encased by a sleek white plastic frame. The Power Mac G5 was a formidable upgrade of Apple’s tower computer for businesses and power users, and received critical hosannas. Laptop buyers were given the choice of white or matte black plastic iBook G4s or the aluminum PowerBook G4s, which came in three different screen sizes. But between the Internet, home networking, music, and the software applications division, Apple was now churning out much more than just personal computers. New versions of iMovie and FinalCut Pro rolled out, along with a cool new application called GarageBand, which let you record and edit and mix musical compositions on your Mac. Apple also introduced a new version of its OS X operating system called Panther that came loaded with its own browser, Safari. Two new keyboards were introduced, one of them wireless. Apple’s beautiful flat-screen Cinema Display monitors grew bigger and sharper. The company that had pushed harder than any other to make Wi-Fi the standard protocol for networking introduced Airport Extreme, a heavy-duty Wi-Fi server for home users, and Airport Express, which could extend a Wi-Fi network throughout an entire McMansion. For users who wanted to make their online chats visual, the company started selling iSight, a Web camera that perched atop their computer monitor. A line of Web servers called Xserve, aimed at businesses, also got an upgrade. And last, but hardly least, iPod users got two special treats in 2004: the sleek and slender iPod Mini, and an iPod Classic with a color screen that could display photos.

Apple was on a roll. The iPod seemed to have years of growth ahead. The product line was focused, beautifully made, and popular. But, of course, Steve didn’t see this as cause for celebration or rest. He saw it merely as the foundation for his next “dent in the universe.”

Jim Collins, the bestselling author of the management classics Built to Last: Successful Habits of Visionary Companies and Good to Great: Why Some Companies Make the Leap … and Others Don’t, has a wonderful phrase to describe an essential characteristic of great leaders: deep restlessness. Collins applies the phrase to Steve, one of the two great leaders who inspire him the most (the other is Winston Churchill, the great English politician who was prime minister during most of World War II, from 1940 to 1945, and again from 1951 to 1955). Collins believes this restlessness is far more important and powerful than simple ambition or raw intelligence. It is the foundation of resilience, and self-motivation. It is fueled by curiosity, the ache to build something meaningful, and a sense of purpose to make the most of one’s entire life.

Collins and Steve got to know each other when Collins was a young faculty member at Stanford University’s Graduate School of Business from 1988 to 1995. During Collins’s first year teaching entrepreneurship, he asked Steve to conduct a session with his students, and they met for the first time. Even though NeXT was not exactly a rousing success, and Pixar was still finding its way, Steve was charismatic, witty, and gracious. Collins, who remained periodically in touch with Jobs throughout his life, believes those years were the best time to meet Steve. “You would have wanted to meet Winston Churchill in 1935, when he was out of favor and no one was paying attention,” he says. “Churchill had his detractors, which is not an uncommon experience for great men. But in the end you judge them by the big picture, the arc of how everything unfolded.” Churchill, like Jobs, suffered humiliating setbacks early in his career, and persevered through a long, arduous climb back to an even greater prominence.

Steve’s restlessness hadn’t always been an advantage. When he was younger, his attention could flit from one project to another, as happened when the Apple III development effort suddenly seemed mundane after he’d seen the potential of graphical computing at Xerox’s Palo Alto Research Center. Founding NeXT so shortly after leaving Apple under a cloud in 1985 was abrupt, as was his purchase of the computer graphics engineering team that would become Pixar. Back then, his restlessness sometimes seemed like impulsiveness. But he never gave up. He didn’t ever quit on Pixar or NeXT. What gave his particular restlessness real depth, then, was its relentlessness. “The things he was trying to do,” says Collins, “were always hard. Sometimes those things beat him up. But the response to fighting through that suffering can be tremendous personal growth.”

Now, in 2003 and 2004, Steve’s restlessness was pushing him forward again, into the uncertain future, and into a test of just how much he had grown. Steve was asking himself the question he always asked himself—“What comes next?”—but this time the answer was particularly complicated. Apple could build something that evolved out of its traditional foundation in personal computing, perhaps something that yet again transformed the user interface. Perhaps it needed to deliver a computer in a new physical form, something like a tablet. Perhaps it could build on the iPod’s success with another consumer electronics product, perhaps even a cellphone.

The iPod had changed everything for Apple. The iTunes Music Store, especially now that its customers included millions of PC users, was turning out to be a whole new distribution system, with very little friction and far less overhead cost than the old way of stamping out CDs in a factory and then shipping them to retailers. By the end of fiscal 2004—just three years after the initial introduction of iTunes—revenue from products related to iTunes and the iPod would account for 19 percent of Apple’s total sales. Apple sold 4.4 million iPods that year, while Macintosh unit sales slipped by 28 percent, from 4.6 million in 2000 to 3.3 million in 2004. The ultimate proof of the impact of iTunes and the iPod was in the bottom line: In 2004, the company reported net income of $276 million, up from $69 million in 2003.