1991–2002: Be Incorporated
In 1991, Gassée started a new venture, Be Inc., with the ambitious goal of creating an entire new computer platform, hardware and software, from the ground up. A number of Apple employees left with him, including Steve Sakoman, the developer of the Apple Newton. Be developed a new operating system, optimized for multiple CPUs and multithreaded applications, which became known simply as "the Be Operating System," or BeOS.
BeOS was written for Be's own dual-processor machine, the BeBox; later development releases of BeOS were ported to run on the Macintosh, and Macintosh clone makers, including Power Computing and Motorola, signed deals to ship BeOS with their hardware when the OS was finalized. In light of this, Be stopped production on the BeBox after selling only around 2000 units, and focused entirely on development of BeOS.
In 1996, Apple Computer decided to abandon Copland, the project to rewrite and modernize the Macintosh operating system. BeOS had many of the features Apple sought, and around Christmas time they offered to buy Be for $120 million, later raising their bid to $200 million. However, despite estimates of Be's total worth at approximately $80 million, Gassée held out for $275 million, and Apple balked. In a surprise move, Apple went on to purchase NeXT, the company their former co-founder Steve Jobs had earlier left Apple to found, for $429 million, with the high price justified by Apple getting Jobs and his NeXT engineers in tow. NeXTSTEP was used as the basis for their new operating system, Mac OS X.
After the return of Jobs, Apple withdrew the license to make Macintosh clones. With Intel's assistance, BeOS moved to "Plan B", a port to the x86 platform. While it arguably never grew past a cult following, it sold enough copies to have a nascent development and user community, and had several thousand programs available for it, including several dozen commercial products. BeOS was also used as an embedded operating system in multimedia production systems from Edirol, TEAC and Level Control Systems. However, partially due to behind-the-scenes pressure from Microsoft, Be was not successful in getting top-tier OEMs to bundle BeOS with their hardware - only Hitachi and AST (who were major in Europe at the time) did so - which Gassée saw as fundamental to their success.
At the end of 1999, Be had a "focus shift," giving their desktop OS away for free (with commercial distributions sold by third-party vendors, similar to Linux distributions) to focus on BeIA, a build of BeOS specifically targeted to internet appliances. The company lost several employees who disagreed with this strategy and who had no desire to work on an appliance OS. While there was vendor interest in BeIA and at least one shipping product based on it (the Sony eVilla), the market for internet appliances proved to be nearly non-existent, and Be laid off most of its employees in 2001, with its assets and the remaining engineers being bought by Palm, Inc. for $11 million that August. Gassée stayed on through that transition, but left in January 2002.