Company News

Apple to Spin Off Software Business

By Andrew Pollack
The New York Times

San Francisco -- April 28, 1987 -- Apple Computer Inc. plans to spin off a company that will develop, publish and sell software for Apple personal computers, the company said today.

Apple's software sales total between $30 million and $40 million a year, said William V. Campbell, a top Apple executive who will head the new company. That would mean the new company, which has not been named, will be one of the largest personal software concerns in terms of sales, though well behind the three leaders - the Microsoft Corporation, the Lotus Development Corporation and the Ashton-Tate Company.

Apple said the spinoff - the first in its history - would reduce the conflicts it has had with outside software companies. These companies have complained that Apple on one hand encourages them to write software for its computers, while on the other competes with them by publishing programs on its own.

Apple said the new company would start as a wholly owned subsidiary and become independent ''probably within a year.'' The Cupertino, Calif., computer maker said the software company would either go public or sell its stock to private investors, with Apple retaining a minority interest.

The new company will market existing Apple applications software, such as the Appleworks program for the Apple II computers and MacWrite and MacPaint for the Macintosh computer, and will develop new software as well as publish programs developed by other companies. The programs will not be marketed under the Apple name.

On Wall Street today, Apple's stock gained $1.75, to $76.75 a share, in over-the-counter trading.

Because good software helps sell computers, Apple needs the independent software companies to develop programs for its machines. Recently, the Macintosh has attracted considerable software support. But Apple could lose some of that support now that the International Business Machines Corporation has introduced a new family of personal computers.

Apple's move came two weeks after Guy Kawasaki, Apple's head of software development, left to form a separate company to market a database program that had been under development at Apple. Mr. Kawasaki said today that he knew of plans for the new software company, but chose not to be involved.

Apple said that Charles M. Boesenberg, vice president for American sales, would become the acting group executive for sales and marketing, replacing Mr. Campbell, who was an executive vice president.

Copyright 1987 The New York Times Company