Inside Look at Birth of the IPod

By Leander Kahney [WIRED]
Story location: http://www.wired.com/news/mac/0,2125,64286,00.html

02:00 AM Jul. 21, 2004 PT


Ben Knauss is a former senior manager at PortalPlayer, the company Apple Computer approached to help develop an MP3 player that would eventually become the wildly popular iPod.

Knauss shared his firsthand knowledge of the device's development, the glitches that almost killed it, and the extraordinary steps Apple took to keep the iPod a secret.

Knauss, who acted as the primary liaison between Apple and PortalPlayer, quit the company in 2001. According to Knauss, the iPod originated with a business idea dreamed up by Tony Fadell, an independent contractor and hardware expert who'd helped develop handheld devices at General Magic and Philips.

"Tony's idea was to take an MP3 player, build a Napster music sale service to complement it, and build a company around it," Knauss said. "Tony had the business idea."

Knauss said Fadell left Philips and set himself up as an independent contractor to shop the idea around. Knauss said Fadell approached several companies and was turned away by all of them, except for Apple.

Apple hired Fadell in early 2001 and assigned him a team of about 30 people -- "a typical industrial design team," Knauss said, including designers, programmers and hardware engineers. He's currently the senior director of iPod & Special Projects Group at Apple.

Knauss said at one of the first meetings with PortalPlayer, Fadell said, "This is the project that's going to remold Apple and 10 years from now, it's going to be a music business, not a computer business."

"Tony had an idea for a business process and Apple is transforming itself on his whim and an idea he had a few years ago," Knauss added.

Knauss said Fadell was familiar with PortalPlayer's reference designs for a couple of MP3 players, including one about the size of a cigarette packet. And though the design was unfinished, several prototypes had been built. "It was fairly ugly," he said. "It looked like an FM radio with a bunch of buttons." The interface, Knauss said, "was typical of an interface done by hardware guys."

But Knauss said Fadell recognized the design's potential. "Tony figured the product was there."

"(PortalPlayer) was attractive to Apple because we had an operating system," said Knauss. "That was a real selling point for Apple. We had the software and the hardware already done, and Apple was on a tight schedule."

Knauss said the reference design was about 80 percent complete when Apple came calling. For example, the prototype wouldn't support playlists longer than 10 songs. "Most of the time building the iPod was spent finishing our product," Knauss said.

At the time, PortalPlayer had 12 customers designing MP3 players based on the company's reference design. Most were Asian hardware manufacturers, Knauss said, but also included Teac and IBM.

Big Blue planned a small, black MP3 player, based on the company's own mini hard drives, which featured a unique circular screen and wireless Bluetooth headphones. "The design for IBM was a lot sexier," Knauss said.

But PortalPlayer went exclusively with Apple. "When Apple came to the table, we dropped all our other customers," Knauss said. For the next eight months, the company's 200 employees in the United States and 80 engineers in India worked exclusively on the iPod, Knauss said.

Apple had a list of features it wanted added to the reference design: Apple's preferred music format, AAC, as well as Audible's audio book format, and a five-band equalizer.

Apple also wanted a new interface, which it designed in-house in about three months, Knauss said.

And while Fadell may have had the business plan, Apple CEO Steve Jobs molded the device's shape, feel and design.

"The interesting thing about the iPod, is that since it started, it had 100 percent of Steve Jobs' time," said Knauss. "Not many projects get that. He was heavily involved in every single aspect of the project."

At the beginning of the project, Jobs held meetings about the iPod every two to three weeks, but when the first iPod prototypes were built, Jobs became involved daily.

"They'd have meetings and Steve would be horribly offended he couldn't get to the song he wanted in less than three pushes of a button," Knauss said. "We'd get orders: 'Steve doesn't think it's loud enough, the sharps aren't sharp enough, or the menu's not coming up fast enough.' Every day there were comments from Steve saying where it needed to be."

Knauss said Jobs' influence was sometimes idiosyncratic. For example, the iPod is louder than most MP3 players because Jobs is partly deaf, he said. "They drove the sound up so he could hear it," Knauss said.

Knauss noted that there were no demands to add FairPlay, Apple's copy-protection technology, which was appended to the second-generation iPod to coincide with the introduction of the iTunes music store.

"There was no discussion of (digital rights management)," Knauss said. "Their belief was DRM would hurt sales when they rolled out the music store. They specifically wanted no DRM in the original iPod."

Knauss said all the iPod prototypes -- and there were several -- were sealed tight inside a reinforced plastic box about the size of a shoebox.

"They put the buttons and the screen in creative locations all over the box so people couldn't tell what product was inside it and how small it was," Knauss said. "They always put the controls in different places -- the scroll wheel on the side, the screen on the top -- to make sure it wasn't predictable what the end design was. The only thing accessible was the jacks."

Knauss said the iPod project was nearly killed just as it drew to completion. Tests showed the iPod drained its batteries even when powered down. "It would have run three hours before going dead, and that was when it was turned off," Knauss said.

"The production lines had already been set up," Knauss said. "That was a tense part of the project: For eight weeks they thought they had a three-hour MP3 player."

Knauss said the problem was eventually fixed and shortly after, Apple bought a majority stake in the company.

Knauss stayed on until near the end of the iPod's development, but quit shortly before it was released because he had no confidence it would be a success.

"It was probably a mistake, but then you have to go with what you think at the time," he said.

Knauss, 33, is now contracting for Microsoft.

Apple, IBM and PortalPlayer did not respond to requests for comment, though PortalPlayer confirmed Knauss had been employed as a senior manager.