History of Apple Inc./Progress in the 1990s

Mid 90s

Continued incompetence, or sowing what was reaped...

By the mid nineties Apple was a shadow of its former self. With few exceptions, Apple products had become overpriced and uninspired; the majority of the product line consisted of indistinct rehashes of the 1984 Macintosh, with relatively minor improvements. Competing products beat the Macintosh in almost every aspect, save maybe for style, typically at a significantly lower price.

Apple was no longer a technological leader and struggled to stay afloat as the company lost money in all of 1994, 95, 96, and 97. The first quarter of 1997 marked a nadir, as Apple stock hit a 12-year low of $4 and the company reported a $708 million loss. Were it not from an unexpected (yet with hindsight, inevitable) cash infusion, Apple would surely have crumbled by the end of the decade.

Late 90s

Attempts at rebuilding

In August 1997 Apple hit rock bottom, having accumulated hundreds of millions of dollars in debt. To avoid an oncoming disaster, Microsoft agreed to pay Apple $150M dollars in exchange for a few perks that would be useful to them, including making Internet Explorer the default browser on all Macs shipped after the agreement. However the main motivation for the transaction cannot be ignored, being that Microsoft would have essentially become the only significant operating system developer in the world and faced countless lawsuits.

In May 1998 Apple released the all-in-one iMac, priced at a brave $1,299. It was designed much like the original Macintosh in a clear plastic case available in translucent shades of red, blue, green and orange. The iMac was controversial among reviewers at launch because of its lack of a diskette drive and the presence of USB ports, which were yet to be well established. The development cost of the machine was never disclosed, but it is highly likely that the money Apple had received from Microsoft essentially went directly to the development and marketing of the iMac. The cultural impact of the iMac was far larger than anticipated and sales were surprisingly good, especially in educational establishments due to their portability and form factor. Apple released updates to the iMac platform in following years with the G3, G4 and G5 iMacs, even venturing further into education markets with the eMac in 2003. The iMac continues to be sold in 2017, although its design is barely comparable to the original and there is no longer a generational naming scheme.

The PowerMac G3 (first released in 1997) was Apple's major professional-oriented product for the majority of the late nineties. It featured the new PowerPC G3 architecture and performed surprisingly well when compared to processors from rivals AMD and Intel, exceeding them by factors of two or three in certain applications. Sadly however the software market was so Windows-oriented in 1997 that many Mac versions of PC software were painfully underoptimised and performed very poorly. However as time progressed the market warmed to the lineup and sales started to improve. Large software corporations such as Adobe taking a new interest in Apple was crucial in this time. By 1998 the product was doing very well and as a response (as well as the match the new iMac) Apple refreshed the exterior design of the machine in bright blue and white colours, with distinctive large "G3" branding on the side (a feature loathed by many but equally well liked). The product was yet another success and Apple finally started to look like it might turn things around.

Apple's stock price leveled off as the company began to earn meager profits again, leaving investors hopeful that a new beginning was in sight for Apple. New, competitive and attractive products began to hit store shelves, slowly at first, but by the early 2000s the company was out of trouble and their retail presence was firmly established.

Apple arguably got ahead of itself in July 2000 by releasing the PowerMac G4 Cube, a tiny cube-shaped desktop computer with a remarkable design that sadly could not justify the $1,599 price for the base model. Sales were poor and production was suspended indefinitely in 2001, however the machine garnered a cult following and sells for high prices nowadays. The nineties had been trying times for Apple, but by the year 2000 they were set on their way to becoming one of the most valuable companies in the world.