Quote · Planet Money
We almost had a smartphone in the 90s. Why did it fail?
Where this was said
Tony Fadell Applies the Lessons: Building the iPod
At 23:10 · chapter starts 21:50
After leaving General Magic, Tony Fadell spent years reflecting on what had gone wrong. He eventually pitched Apple on an idea for a portable MP3 player. When Steve Jobs approved the project in March 2001, Apple was $500 million in debt — financial constraint was baked in from day one. [1] — Tony Fadell "Apple was $500M in debt when greenlighting iPod: When Steve Jobs greenlit the iPod project in March 2001, Apple was $500 million in debt — …" 22:27 Tony's team began with a crystal-clear customer proposition: take 1,000 songs in your pocket. That clarity was the constraint that General Magic never had. Rather than building from scratch, Fadell sourced existing components from around the world — processors, batteries, screens — assembling them like Lego blocks. He even tore apart a Bang & Olufsen cordless phone to replicate its wheel mechanism for the iPod's iconic click wheel. And he set a hard deadline: the product had to ship by Christmas, because Sony was certain to release a competitor. [2] — Tony Fadell "When Tony Fadell brought an iPod prototype to Apple in 2001, Apple was $500 million in debt. Steve Jobs greenlighted the project anyway — b…" 21:50 The team delivered. Two hours after the iPod's launch event, Steve Jobs called Tony in to start planning the next model. General Magic had one shot; Apple iterated through 18 versions of the iPod, eventually building toward the iPhone itself.
When Tony Fadell brought an iPod prototype to Apple in 2001, Apple was $500 million in debt. Steve Jobs greenlighted the project anyway — but on a tight budget and a hard Christmas deadline. That scarcity and urgency did exactly what unlimited resources at General Magic never could: it focused the team.
When Steve Jobs greenlit the iPod project in March 2001, Apple was $500 million in debt — a financial constraint that Tony Fadell says actually helped focus the team.
Tony Fadell's team built and shipped the original iPod in less than eight months, driven by a hard Christmas deadline and the threat of Sony entering the market.
Tony Fadell worked on 18 iterations of the iPod at Apple, a stark contrast to General Magic's single, years-long attempt that left no room for improvement.
Despite General Magic's failure, alumni went on to become early Google employees, invent Android, create eBay, and found LinkedIn.
Despite General Magic's collapse, its alumni went on to co-found or become early employees at some of the most important companies in tech history: Google, eBay, LinkedIn, and Android. The failure was a masterclass in what not to do — and many of its graduates applied that lesson brilliantly.
