Gossip that NeXT Computer Inc might abandon its hardware business to concentrate on its NeXTstep object-oriented operating environment (CI No 2,100) has proved all to valid and late Tuesday the company confirmed that it is to abandon manufacture of its workstations, with 100 of the employees on that side of the business going to major investor Canon Inc, and another 220 or so being laid off. Canon, which paid $165m for its 17.9% stake in NeXT – where Ross Perot, in another financing round, paid only $20m but got 11%, was reported to have already agreed to buy the hardware side, but said in Tokyo yesterday that it was only considering the move, and will not decide definitely until the end of May. NeXT will be left with about 180 employees after the shut-down. This is a very painful move for us, but we don’t want to wake up a year from now and wish we hadn’t done it, founder Steve Jobs told United Press International. We’ve got a real head start on the rest of the industry, with NeXTstep, Jobs said, noting that its only real competitors for top-line operating system software will be Microsoft Corp with its forthcoming Cairo, and the Taligent Inc alliance between Apple Computer Inc and IBM Corp, adding that the company will unveil a variety of new software products on May 25. The hardware business that Canon may buy includes the automated manufacturing plant in Fremont, California. Canon sells NeXT computers in Japan – where because there is no single desktop standard, the machines are better placed to win market share than they are in the US and Europe. Canon also operates Canon Compter Systems Inc in Southern California. Jobs himself still holds 46% of NeXT and has invested a reported $200m in the company. NeXT shipped an 69,300 workstations last year, compared with 217,000 shipped by Sun Microsystems Inc, according to International Data Corp’s estimates.
