The first thing to say about the film General Magic (official site, IMDb) is that you should watch it.
The film is available on iTunes, and on Amazon Prime, and from lots of other places too.
It tracks the rise and fall of the company with the same name as the film – General Magic – and the impact of the people involved in the subsequent rise of the smartphone industry.
Here’s the trailer:
General Magic was conceived inside Apple in 1989, and, as reported at the time by the New York Times, was spun out as a separate entity in 1990:
Three well-known technologists from Apple Computer Inc., including perhaps its most distinguished programmer, Bill Atkinson, are forming a new company.
Mr. Atkinson and Marc Porat, another Apple researcher, are leaving Apple to form General Magic Inc. They will be joined by Andy Hertzfeld, who designed much of the operating system of the Macintosh computer in the early 1980’s but who has not been with Apple for six years.
The company, which will be based in Mountain View, Calif., will make products known as ”personal intelligent communicators.” While the company would not elaborate, industry analysts believe this refers to handheld devices that can store appointments and other information and transmit and receive information, either over telephone lines or over the airwaves…
Mr. Atkinson, 39 years old, has been with Apple for 12 years. He is best known for developing Hypercard, a program included with every Macintosh that allows users to organize information on computerized notecards…
Dr. Porat, 42, who will be president of General Magic, came to Apple in 1988 and was manager of business development in the advanced technology group.
Much of the vision of the company came from Marc Porat, the company’s first CEO. The film quotes from a visionary email Marc Porat had written in 1990 to John Sculley, at the time Apple’s CEO, about the kinds of devices their platform would enable:
A tiny computer, a phone, a very personal object… It must be beautiful. It must offer the kind of personal satisfaction that a fine piece of jewelry brings. It will have a perceived value even when it’s not being used. It will offer the comfort of a touchstone, the tactile satisfaction of a seashell, the enchantment of a crystal. Once you use it you won’t be able to live without it.
The film also shows a large book of design ideas, dating (it said) back to the same formative era. Here are a couple of sketches from the book:
(the name given to the concept device in this sketch is “remotaphonputer”), and
General Magic operated in stealth mode until 1993. By that time, many of Apple’s key employees had transferred to work there, all inspired by the vision of designing a hardware and software platform for handheld “personal intelligent communicators”. Also by that time, the company had assembled a formidable collection of investors, including AT&T, Sony, Motorola, Philips, and Panasonic. These backers were joined in due course by British Telecom, Cable & Wireless, France Telecom, Fujitsu, Mitsubishi, NTT DoCoMo, Nortel, Sanyo, and Toshiba. All these companies provided a senior executive to what was known as the “Founding Partner’s Council”, and backed General Magic with a financial stake of up to $6M each.
One powerful feature of the film is the interweaving of lots of archival documentary footage, shot during the company’s formative period by Sarah Kerruish. That shows, for example, a young Megan Smith saying that, one day, the technology would fit onto a device as small as a “Dick Tracy wristwatch”. Smith later served under Barack Obama as the USA’s Chief Technology Officer. As it happens, another young employee at General Magic, Kevin Lynch, went on to lead the Apple Watch project. And that’s only the start of the list of stellar accomplishments which lay ahead for one-time General Magic employees. As the film points out, around 98% of the present day smartphone market can be traced to efforts of two people who sat close to each other in the General Magic workspace: Andy Rubin, the designer of Android, and Tony Fadell, who is credited as “father of the iPod” and “co-inventor of the iPhone”. Rubin is mainly missing from the movie, but Fadell appears regularly, speaking with great passion.
With the aid of Goldman Sachs, General Magic IPO’ed in February 1995, in a huge publicity wave. The company’s stock price promptly doubled.
However, the company was already facing many issues. I touched on these in a short section in my own 2014 book Smartphones and Beyond, in the chapter entitled “Die like IBM, or die like Apple”. That chapter referred to various ideas contemplated by Psion in the mid 1990s as its software team laboured to create what would later be known as Symbian OS – software initially targeted for a device code-named “Protea” (this would reach the market in 1997 as the Psion Series 5):
Psion’s confidence about the prospects for its forthcoming 32-bit software system (the future Symbian OS), that was so high when serious coding had started on that system in late 1994, had grown considerably more tentative by the first half of 1996. One reason was the repeated delays in the development project, as mentioned in the previous chapter. But another reason was the changing competitive landscape.
Mounting competition
As the Protea project zigzagged forwards, sideways, and sometimes backwards, with uncertain and seemingly unknowable end date, Psion’s senior management wondered from time to time whether a different software system, obtained from outside the company, might prove a better bet for future mobile products.
For example, there was a period of around a week when senior management were enthralled by the “Magic Cap” system from a Californian company with the audacious name “General Magic”. General Magic had been spun out of Apple in 1990…
Partners and investors for General Magic included Sony, Motorola, AT&T, Philips, Matsushita, and British Telecom. A powerful buzz about the company’s future meant that its stock price doubled on the first day of its IPO in February 1995. It was therefore understandable that Psion senior managers would consider joining the General Magic party, and licence Magic Cap for use in their PDAs. After all, one of them whispered, think of the cost savings from not needing to maintain such a large in-house team of Psion’s own software developers. How much simpler to utilise ready-made software, created by the same team that had achieved such marvels in their earlier careers elsewhere in Silicon Valley! And how cute the Magic Cap software seemed, with its real-world metaphors and winsome bouncing rabbit.
That particular fancy soon evaporated. The Magic Cap software might appear cute, but closer examination revealed shallowness (weak functionality) in practice. The devices brought to market – by Sony and Motorola – were pale shadows of what the General Magic marketing machine had previously led people to expect. In contrast, Psion could see the strength in depth baked into the developing 32-bit Epoc software system. Psion’s development team escaped this particular axe.
(See here for a longer excerpt from that chapter.)
Total sales of the two devices running General Magic’s software were a paltry 3,000 units. The devices fell a long way short of the vision, and had few redeeming features. The company started a brutal downward slide. Investors were left high and dry. The post-IPO stock price of $26 per share had fallen to $1.38 by 1999.
The film highlights a major learning: the way to implement a grand vision is via a series of incremental steps. Don’t try to fit every desired innovation into a single release of a product. Do it in stages, with good quality throughout. That’s a lesson which Tony Fadell took with him from General Magic to Apple in later life, where he oversaw regular increments to the functionality of the iPod, which in time laid the foundation for a similar set of regular increments in the functionality of the iPhone.
What the film emphasises less is the difficulty posed to the company by its wide set of powerful investors and their divergent interests. The governance problems of General Magic were high in the minds of the executives from Ericsson and Nokia who visited Psion’s offices in central London in April 1998 to discuss the potential formation of the Symbian joint venture. With the approval of a team from Nokia that included Mikko Terho and Juha Putkiranta, Ericsson’s Anders Wästerlid included the following points in a set of guiding principles:
Avoid the structure of General Magic
Need to be able to act fast
Need to learn how to deal effectively with conflicts within the group of owners
Yes, Ericsson and Nokia wanted other companies to become involved with the joint venture, in due course. However, they offered this practical observation:
The more people who are in the boat, the tougher it is to start. But it’s easy for more people to jump in once the boat is moving.
(That meeting, as well as many other steps in the formation of Symbian, are covered in a later chapter of my book, “Death Star or Nova”.)
To its credit, the film highlights one more way in which the vision of General Magic failed to anticipate market development: lack of appreciation of the forthcoming importance of the worldwide web. The services accessed on General Magic devices would be provided by the network operator, such as AT&T. It was an intern who, apparently, first drew this omission to the attention of the General Magic leadership.
Where the film does less well is in the implication running nearly all the way through, that the work of General Magic laid a uniquely important basis for what smartphones subsequently became. One commentator states, “Without General Magic, there could never have been Android”.
In this regard, the film provides an overly Silicon Valley centred view of the prehistory of today’s smartphones.
Here’s just some of what’s missing from that view, and from what General Magic was trying to accomplish:
- The emergence (as just mentioned) of the web
- Push technology, pioneered by BlackBerry RIM
- The devices in Japan running on NTT DoCoMo’s network, with their rich ecosystem of iMode apps and services
- The devices running Brew services on Qualcomm phones
- Simple PC connectivity, as pioneered by Palm
- Access to enterprise services, led by Microsoft’s handheld computers
- Nokia’s first communicator, launched in 1996, running software from GeoWorks
- The first device marketed as a smartphone, the GS 88 launched by Ericsson in 1997, also running GeoWorks software.
Last, but not least, I am bound to mention the very considerable thinking that took place at Psion, from the early 1980s onwards. When I started work at Psion as a software engineer in June 1988, I discovered that a huge amount of design had already taken place for what would eventually become the Psion Series 3 communicator. That design was an iteration on what Psion had learned in a number of earlier projects, including two generations of handheld organiser products. On the launch of the Organiser in 1984, Psion had declared the device to be “The world’s first practical pocket computer”. This phrase headlined a magazine promotion which can be found, along with lots of other useful archive material, on Eddie Slupski’s ‘Bioeddie’ website. The magazine article went on: “The Psion Organiser will change the way you work.” It was a prescient claim.
(For more about these early design ideas at Psion, see, you guessed it, another chapter from my book, “Before the beginning”. For the causes of Psion’s eventual departure from the consumer handheld space, see later chapters of the same book.)
It’s often said that history gets to be written by the victors. The world’s most successful smartphones, by far, are from two Silicon Valley companies, Apple and Google. Therefore Silicon Valley insiders have the right to emphasise the flow of personnel and ideas from General Magic to these current platforms. Indeed, it’s a fascinating story.
However, my own view is that one dimensional accounts of history – however absorbing – are likely to mislead. The best products and services are able to integrate insights and contributions from multiple diverse backgrounds.
