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MacBytes
Nov 12, 2008, 12:11 PM
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Category: News and Press Releases
Link: Apple's Persuasive Arguments Against Psystar, End Could be Near (http://www.macbytes.com/link.php?sid=20081112131145)
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Posted on MacBytes.com (http://www.macbytes.com)
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zombitronic
Nov 12, 2008, 01:02 PM
"At issue is Psystar's counter claims is that Apple has a monopoly in Mac OS X and they should be allowed to compete in that market. The claim is similar to a claim that General Motors has a monopoly in its Buick "brand" and that other companies should be able to copy and sell Buicks."

This was obvious from the beginning. Good night, Psystar.

JNB
Nov 12, 2008, 01:32 PM
Reading through some of the briefs & filings, it sorta appears that Psystar takes the same approach in hiring counsel that they do in selling computers. Or, they have competent counsel that just has to deal with a pile of poop and trying to convince the court that it really smells lovely.

50548
Nov 12, 2008, 01:33 PM
"At issue is Psystar's counter claims is that Apple has a monopoly in Mac OS X and they should be allowed to compete in that market. The claim is similar to a claim that General Motors has a monopoly in its Buick "brand" and that other companies should be able to copy and sell Buicks."

This was obvious from the beginning. Good night, Psystar.

Exactly. I just look forward to seeing those stupid opportunistic pirates in the mud. In fact, they have stayed afloat for much longer than could be reasonably expected.

Show no mercy and make them go the way of the dodo, Apple. One copycat was enough in MS already.

Easy money and free-riding? Try being a 419 scammer.

mkrishnan
Nov 12, 2008, 01:49 PM
"At issue is Psystar's counter claims is that Apple has a monopoly in Mac OS X and they should be allowed to compete in that market. The claim is similar to a claim that General Motors has a monopoly in its Buick "brand" and that other companies should be able to copy and sell Buicks."

This was obvious from the beginning. Good night, Psystar.

Actually, though, this particular argument seems to be legally almost completely irrelevant.

In the opinion of the attorney who contacted TMO, Psystar's antitrust claims are fatally flawed and fail to meet the standard set forth by the Supreme Court ruling in Twombly. Single brands within a competitive market are not recognized by the courts as a monopoly unless the brand has "market power. "Other federal courts have held that the Mac OS X is one OS in a market that consist of other competing operating systems and that Apple does not have market power, because its market share is less than 30%," he said.

In essence, to continue the analogy, the argument is not that Psystar is asking to compete with GM in the Buick brand, but that they are claiming that roads are only open to the Buick brand. The precedent says, in essence, this is fine, as long as there are many roads between the places people go that are not only open to Buicks.

A stretch, because it was a bad analogy to begin with, but there's a big difference between what this lawyer said and that first quip in the article: According to the quip, it would never be permissible for Psystar to ask for this kind of competition. Competitors to Kleenex can make their own tissue paper, but they cannot make "Kleenex," irrespective of the market dominance of this product, because that's brand infringement.

Here, the issue is not brand infringement, but market dominance. According to the comments of the lawyer, Psystar's position would become tenable if Apple were to attain a >30% market share. But it is not now because they do not now.

That's vastly different.

theheadguy
Nov 12, 2008, 02:05 PM
This was obvious from the beginning. Good night, Psystar.
You say this as if Psystar is not promoting healthy competition. Why not be more forward? Please, Apple, maintain a complete monopoly. For the love of god, do not allow choices and price wars for the benefit of me and other consumers out there.

In relation to Psystar, Apple makes two things; hardware and an OS. Psystar is not cloning Apple parts, or their image. They are simply placing the OS on different and more competitively priced hardware. Additionaly, they don't claim to be selling "Apple Computers" or "Macs". Thus, the Buick analogy is weak and poorly thought out.

To say good night to Psystar is rather sad in and of itself. Apple has enough money to fight for itself; their cheerleaders on the side don't even know what they are cheering for.

bitWrangler
Nov 12, 2008, 02:10 PM
Here, the issue is not brand infringement, but market dominance. According to the comments of the lawyer, Psystar's position would become tenable if Apple were to attain a >30% market share. But it is not now because they do not now.

That's vastly different.

If psystar can hold out a bit longer, then they can start arguing what "market share" really means. If Apple manages to sell 30% of unit PC's in the US for a quarter, would that represent 30% market share under this definition?

Bad Paper
Nov 12, 2008, 02:15 PM
If psystar can hold out a bit longer, then they can start arguing what "market share" really means. If Apple manages to sell 30% of unit PC's in the US for a quarter, would that represent 30% market share under this definition?Doubtful. I think we're talking installed base, which will continue to be in the single digits for a very long time.

nagromme
Nov 12, 2008, 02:25 PM
If Apple were to license their OS to other companies, it could go in one of three general directions:

1. Apple specifies every single component and internal design factor, so that every Mac clone is IDENTICAL (except in outward appearance) to a specific Apple model, or else identical to specific new config(s) that Apple creates for third parties to follow. No significant choice of models is likely to be added to the market--and the clones would probably cost more, since they'd use the same parts as Apple, but bought in smaller volume. But if you prefer a non-Apple outer design, you'd have some choice in that. (Unless Apple had to dictate that as well, for cooling.)

OR

2. Apple sells the OS "as is," made for their OWN Macs, and therfore not every OS feature and update actually works on clones. Your clone Mac may simply stop working or have annoying glitches at any time, because some Apple update is not specifically tailored to the hardware that Psystar or some other company is using. Maybe your fans start to fail? Maybe iCal won't synch over Bluetooth every time? Maybe Disk Utility doesn't see all attached volumes? Who knows. An OS and its bundled utilities are a huge and complex system, prone to breaking when you complicate the hardware (just ask Microsoft). These other companies' customers would blame Apple for this risk, and they'd blame Psystar for hiding this risk in the fine print. Buy a Mac-clone and it will probably work today. But will next week's updates work on it? Maybe. Is that good enough for you?

OR

3. Apple actually SUPPORTS these other companies and their customers. Apple spends MASSIVE time and money TESTING their OS and updates for non-Mac hardware, and then FIXING any issues that arise, all for the benefit of companies like Psystar. In this case, if an update breaks on some certain Mac clone config, Apple will be partly responsible. This will hurt OS X in two HUGE ways: first, it will add bloat, complexity, and therefore bugs (again, ask Microsoft) since the OS now has to be aware of and compatible with other hardware and other drivers. Second, it will SLOW DOWN Apple innovation, due to all the extra testing and debugging needed. Does anyone think Snow Leopard would actually get done in the the same amount of time if it were being tested to work on random non-Apple clones? And throwing more programmers at the problem doesn't make it go away: Google the "mythical man-month" (and again, see Microsoft).

Which of these 3 paths are Psystar supporters hoping for? More choice IS good, certainly, but does anyone truly deny that it would come at a price?

Here's the choice I want:

I want to be able to choose an OS and hardware designed TOGETHER. If you want them to be separate, Microsoft has an option for you. But please don't take away MY choice to have them united. The benefits of that are real.

Do people think that having an OS and hardware specifically designed together is a choice that should not exist in the market?

zombitronic
Nov 12, 2008, 02:28 PM
You say this as if Psystar is not promoting healthy competition. Why not be more forward? Please, Apple, maintain a complete monopoly. For the love of god, do not allow choices and price wars for the benefit of me and other consumers out there.

In relation to Psystar, Apple makes two things; hardware and an OS. Psystar is not cloning Apple parts, or their image. They are simply placing the OS on different and more competitively priced hardware. Additionaly, they don't claim to be selling "Apple Computers" or "Macs". Thus, the Buick analogy is weak and poorly thought out.

Maybe the analogy can be picked apart. Take that up with Apple Legal. The bottom line is that Apple is not a monopoly, but we'll let the courts prove that. We've already had many forums of debate over this. Your choice, if you chose not to use Mac OS X, is to use Linux or Windows. Where's the benefit to you if Apple has to serialize OS X and charge you $400 for it in order to protect their profits?

Psystar has done nothing for healthy competition. If Psystar was actually about healthy competition and not just leaching, they would pick up a Linux distro, improve upon it and sell it as their own OS. Psystar has created NOTHING ORIGINAL. There's nothing healthy about that.

To say good night to Psystar is rather sad in and of itself. Apple has enough money to fight for itself; their cheerleaders on the side don't even know what they are cheering for.

I know exactly what I'm cheering for. AAPL.

mkrishnan
Nov 12, 2008, 02:30 PM
Doubtful. I think we're talking installed base, which will continue to be in the single digits for a very long time.

I don't know which case the 30% bogey comes from, so I'm not sure myself, but it's probably something that becomes debatable by the time new sales marketshare reached 30%. Psystar doesn't really compete with an Apple computer that's already sold and might upgrade to a new operating system -- whether that computer gets Windows, OS X, or Linux on it has no bearing on Psystar's ability to market. Psystar competes in the market of new computers sold with an OS preinstalled. So the argument is that they can sell any number of the 85 or whatever computers out of a hundred that are not sold with OS X, making the 15 that are sold that way irrelevant.

I think the argument could also be made that the appropriate metric is neither new computers sold nor existing computers but something like share of OS licenses sold (inclusive of new computers). The logic would be that, particularly in a saturated market, a consumer evaluates multiple options such as... install a new OS on existing hardware, buy new hardware with Windows, buy new hardware with Linux, buy new hardware with OS X, buy new hardware and use the old license, etc. Right now, Psystar can compete in the subset of cases where a person buys new hardware and runs Windows or Linux or buys new hardware and uses their old license of Windows (or Linux), but they cannot compete in the buy new hardware and use OS X category, or the non-existent buy new hardware and use your old OS X license category.

I think it could all get very messy... and quite possibly re-evaluated if Apple continues to rise.

JNB
Nov 12, 2008, 02:34 PM
You say this as if Psystar is not promoting healthy competition. Why not be more forward? Please, Apple, maintain a complete monopoly. For the love of god, do not allow choices and price wars for the benefit of me and other consumers out there.

You're missing the entire point. Apple does NOT possess a monopoly, period. Being the only maker of OSX does not rise to that definition. Nor does restricting the licensed use to only Apple-branded PC's. Apple sells the hardware and the OS as a complete system, not as separate components designed or intended to function independent of one another.

If you want OSX on a beige box, go right ahead, but it's up to you as the end user to accomplish it, and Apple will have no problems with it. But if you want a pre-made PC to do it, then buy an Apple. Those are the choices.

nagromme
Nov 12, 2008, 02:47 PM
I can certainly understand why people would WANT there to be no downside to cloning. And why they'd WANT the law to force Apple to become more like Microsoft. Choice sounds great! I'd love to see a netbook, minitower, whatever clone companies might come up with! Nobody would deny the upside of that.

But the reality is that there IS a downside too--a big one (see my trilemma above)--and the law probably won't force Apple down that road. What we WANT is not always doable in practice.

mkrishnan
Nov 12, 2008, 03:01 PM
But the reality is that there IS a downside too--a big one (see my trilemma above)--and the law probably won't force Apple down that road. What we WANT is not always doable in practice.

Path two is really essentially what Apple does about unlocking iPhones. This path in essence works fine as long as its a market minority and doesn't have a positive perception from customers. If corporate customers started buying from Psystar, or if people started generating a miasma of ill will towards Apple because their Psystars (or xxx clones) didn't work properly, and this eventually became a dominant enough theme that people thought of it as Apple's fault, then Apple would suffer from it.

So yeah, this path basically works except that it's a dangerous slope potentially for Apple.

cohibadad
Nov 12, 2008, 03:07 PM
You say this as if Psystar is not promoting healthy competition. Why not be more forward? Please, Apple, maintain a complete monopoly. For the love of god, do not allow choices and price wars for the benefit of me and other consumers out there.

In relation to Psystar, Apple makes two things; hardware and an OS. Psystar is not cloning Apple parts, or their image. They are simply placing the OS on different and more competitively priced hardware. Additionaly, they don't claim to be selling "Apple Computers" or "Macs". Thus, the Buick analogy is weak and poorly thought out.

To say good night to Psystar is rather sad in and of itself. Apple has enough money to fight for itself; their cheerleaders on the side don't even know what they are cheering for.

We all play by rules. In this case, it's legal rules. Healthy competition isn't taking someone else's intellectual property and using it to make a profit yourself. And Apple doesn't have a monopoly. You shouldn't have to be an Apple cheerleader to encourage fair play and justice. If you were in Apple's shoes and someone used your intellectual property as Psystar has you'd be crying to high heaven how wronged you were instead of praising them for healthy competition and offering choice.

nagromme
Nov 12, 2008, 03:10 PM
Path two is really essentially what Apple does about unlocking iPhones. This path in essence works fine as long as its a market minority and doesn't have a positive perception from customers. If corporate customers started buying from Psystar, or if people started generating a miasma of ill will towards Apple because their Psystars (or xxx clones) didn't work properly, and this eventually became a dominant enough theme that people thought of it as Apple's fault, then Apple would suffer from it.

So yeah, this path basically works except that it's a dangerous slope potentially for Apple.

Agreed--those "workaround"/"hack" niches are fine for hobbyists, and I like that such options exist! Here's to the crazy ones. But that path is not suitable for most people.

jayducharme
Nov 12, 2008, 04:53 PM
Apple spends MASSIVE time and money TESTING their OS and updates for non-Mac hardware, and then FIXING any issues that arise, all for the benefit of companies like Psystar.

Right. And then we have Windows.

How is Psystar getting Leopard on their machines? Do they just buy legit copies and then install them? If that's the case, it might be a sticky legal question as to whether the company is doing anything that the law can prevent.

But I can certainly see how this would ruffle Apple's feathers. Apple has prided itself in integrating its hardware and software seamlessly for a unique and stable computing experience. Psystar could toss all that out the window simply to offer a lower price. That would be akin to taking a Rolls Royce engine and sticking it inside a Yugo, claiming that it really was a Rolls Royce. The engine might be the same, but the overall experience will probably be much different.

w0ngbr4d
Nov 12, 2008, 05:33 PM
Didn't Apple sue on the grounds of copyright infringement?

"The Mac maker filed a formal complaint in the U.S. District Court for the Northern District of California on July 3rd, just one day after Psystar began distributing a modified version of the Mac OS X 10.5.4 Leopard update to customers who had previously purchased one of its unauthorized Mac systems."

http://www.macrumors.com/2008/07/15/apple-sues-psystar-over-opencomputer/

Psystar countersued Apple for anti competitive practices.

http://www.macrumors.com/2008/08/04/psystar-lawyer-hints-at-anti-trust-defense/

http://www.macrumors.com/2008/08/27/psystar-to-countersue-apple-for-anticompetitive-practices/

Copyright Infringement
Psystar is guilty as charged. They probably will try to count each download of the modified update as one count of infringement. Depending on the fine per count, Psystar could be bankrupt on this one charge. Downloads might be hard to prove, so maybe they would base it on number of copies of Leopard sold by Psystar.

Anti-Trust
A company automatically has a monopoly on their products because they are the only ones that can produce them. There is no "Mac OS X" market...the market is operating systems. The only thing they could get in trouble for is "illegal bundling" or "illegal tying" of products together.

http://en.wikipedia.org/wiki/Tying_(commerce)

"Success on a tying claim typically requires proof of four elements: (1) two separate products or services are involved; (2) the purchase of the tying product is conditioned on the additional purchase of the tied product; (3) the seller has sufficient market power in the market for the tying product; (4) a not insubstantial amount of interstate commerce in the tied product market is affected."

Even if Apple if found guilty of tying, they don't have to sell OS X at a reasonable price. Just like Apple did with the iPhones in Europe, iPhone with no contract is 999 euros. They could sell copies of OS X to Psystar and the public for $999.99 with no support. This would effectively eliminate Psystar or any other clone maker.

This will be an interesting case to follow. Apple might have to settle for less than 25% margin on their computers if Psystar wins.

hihater
Nov 12, 2008, 05:36 PM
You say this as if Psystar is not promoting healthy competition. Why not be more forward? Please, Apple, maintain a complete monopoly. For the love of god, do not allow choices and price wars for the benefit of me and other consumers out there.

In relation to Psystar, Apple makes two things; hardware and an OS. Psystar is not cloning Apple parts, or their image. They are simply placing the OS on different and more competitively priced hardware. Additionaly, they don't claim to be selling "Apple Computers" or "Macs". Thus, the Buick analogy is weak and poorly thought out.

To say good night to Psystar is rather sad in and of itself. Apple has enough money to fight for itself; their cheerleaders on the side don't even know what they are cheering for.
Why don't you get Psystar to develop their own OS, and sell it with their own computers? :rolleyes:

Winni
Nov 12, 2008, 07:06 PM
According to former articles, Psystar purchased fully legal copies of OS X and then installed patched versions of these on their computers on behalf of their customers. So Apple got money of each and every sold Psystar machine, and all that Psystar did was providing the service of creating a so-called "Hackintosh" system.

I think Apple's claims for copyright infringement are on very thin ice here. However, both sides have to use some fancy legal arguments to make their case.

The point is that Apple wants to force all of its customers into purchasing Apple hardware to use OS X, which can also be bought separately and without any hardware bundled to it (on Amazon, for example).

Psystar now offers a hardware that is compatible to this Apple operating system and provides the service of installing it on their compatible hardware.

Apple says that this is copyright infringement to defend their monopoly on providing hardware for their software.

And this is exactly what Psystar claims: That Apple uses anti-competitive techniques to prevent others from entering the OS X market.

It's quite obvious that Psystar's argument is sound, and it is also obvious that this is not in the best interest of --US-- customers.

You're afraid that OS X becomes like Windows when it officially has to support non-Apple hardware? Seriously guys, you bought into too much FUD and don't know enough about software development and system architectures if you actually believe this. Besides, since the introduction of NT, Windows is a rock solid operating system when maintained properly. Saying something else is also FUD. But it is true that OS X and its BSD foundation use an even safer and more robust architecture, and BSD Unixes run on even MORE different hardware platforms than Windows (just check out NetBSD).

By the way, what I see in my Mac Pro is not much different from what I see in the Dell Precision Workstation at work. Apple uses standard Intel, AMD (ATI) and nVidia components that EVERYBODY can use in their computers. The days of proprietary Apple hardware are long over. There is nothing special in a Mac these days that is relevant for the performance of an operating system and that no other hardware vendor offers.

You think that it will become more expensive if Apple is going to do what Microsoft has already been doing for DECADES: Certifying hardware for their software? That's another joke. Every vendor selling a piece of hardware that has a 'certified for Windows' logo on it had to pay for it, and strangely enough, neither Windows (Systembuilder versions) nor PC hardware are more expensive than Apple computers and OS X boxes. Actually, Microsoft makes a lot of money with these logo programs - it's a source of income for them, not costs. Red Hat and Oracle have similar programs, by the way. It's common business practice.

Would this affect Apple's hardware business? Sure. A company like Dell sells low-end machines that do not compete with Apple, but also high-end systems with enterprise support that Apple also does not offer today. And they sell large amounts of mid-range systems, where Apple is today, and that might hurt them. Or maybe not, because Apple's current audience mostly buys Macs because of their design and not because of their specifications.

Would this be a problem? You know what? I don't think so. On the long run, Apple would make even MORE money than they do right now. There are many people out there who would buy and use OS X and other Apple software in a heartbeat, but who would -never- purchase Apple hardware for many individual reasons. Costs being one and the fact that you cannot customize your own hardware being the big other reason.

What would you say if Microsoft said that Windows would only be allowed to run on a "Microsoft certified computer"? Oops. Forget BootCamp, Parallels and VMWare Fusion. You would be violating the EULA by installing Windows on a Mac. And you would be hating Microsoft even more. But this is -exactly- what Apple does. But strangely enough, that business practice all of a sudden is okay for all the Apple zealots around.

Es ist eben nicht dasselbe, wenn zwei das Gleiche tun.

The only reason why Apple is not opening OS X to other hardware vendors is Steve Jobs's ego. There is no business argument for that decision.

JNB
Nov 12, 2008, 07:53 PM
According to former articles, Psystar purchased fully legal copies of OS X and then installed patched versions of these on their computers on behalf of their customers. So Apple got money of each and every sold Psystar machine, and all that Psystar did was providing the service of creating a so-called "Hackintosh" system.

I think Apple's claims for copyright infringement are on very thin ice here. However, both sides have to use some fancy legal arguments to make their case.

Sorry, you lost that one on the first paragraph. You even restated the infringement yourself (in boldface). That is the definition of infringement. An individual could do this on their own, but an enterprise such as Psystar can't, and certainly not to resell.

w0ngbr4d
Nov 12, 2008, 07:56 PM
...I think Apple's claims for copyright infringement are on very thin ice here...


Apple isn't claiming copyright infringement because Psystar is installing Leopard on non Apple branded machines. Psystar hosting a modified 10.5.4 update that it distributes to its customers...that is the basis of the copyright infringement case.

You can't take a copyrighted work and distribute it on your own without permission of the copyright holder, even if the work is freely available. The Apple keynotes website was shut down for the same reason...the keynotes were copyrighted material and the owner of the site didn't have permission to distribute them.

Apple will probably have to prove that they were damaged in some way for the claim to stick. The only damage claim I could think of is Apple saying that if this modified 10.5.4 update was installed on a genuine Mac, it could have caused problems for possibly millions of customers. Imagine the support costs if that would happen. The chance of that happening is pretty small considering most users use Software Update, but all Apple has to do is convince the judge.

Pretty open and shut if you ask me. The anti-competitive countersuit...different story.

matticus008
Nov 12, 2008, 08:20 PM
Actually, though, this particular argument seems to be legally almost completely irrelevant.
Not at all. One of Psystar's arguments is abuse of market power, which only exists if Apple computers are the only brand that exists in the market. It is not. No matter how distinctive the brand, be it Maserati or Bentley or SMART, a "monopoly" in your own brand is not a monopoly at law.
In essence, to continue the analogy, the argument is not that Psystar is asking to compete with GM in the Buick brand, but that they are claiming that roads are only open to the Buick brand.
That's a tortured and inaccurate analogy, though. It's not about roads, or gas, or any other external supply. They're claiming that certain Buick products are only made available to owners of Buick cars. That is the continuation of the analogy, if you must go there, and it's not legally problematic.

Here, the issue is not brand infringement, but market dominance.
You're mixing things that ought not to be mixed. "Brand infringement" by which I imagine you mean trademark infringement is not involved or referenced. The scope of competition is referenced, and market "dominance" has a role in that. Psystar is absolutely free to compete with Apple hardware on its merits. It's free to select, customize, or create an operating system that competes with Apple's. It's free to combine that hardware and software in a manner it sees fit. But the appropriate scope of competition does not include the appropriation of Apple's exclusive rights in OS X in order to sell Psystar's hardware.
You say this as if Psystar is not promoting healthy competition. Why not be more forward? Please, Apple, maintain a complete monopoly.
There is no monopoly. There is no such as "healthy competition" with your own products.

They are simply placing the OS on different and more competitively priced hardware. Additionaly, they don't claim to be selling "Apple Computers" or "Macs". Thus, the Buick analogy is weak and poorly thought out.
They have no legal right to place the OS on any hardware. They trade on Apple's software in order to sell Psystar hardware, which is taking commercial advantage of something that is not theirs to exploit. The Buick analogy is neither weak nor poorly thought out, but simply misunderstood by the laity.
I don't know which case the 30% bogey comes from, so I'm not sure myself, but it's probably something that becomes debatable by the time new sales marketshare reached 30%.
It doesn't come from a single case, but rather the homogenization of data points from all the major players. In essence, a firm cannot under ordinary circumstances acquire market power short of about 30% market share.

Psystar competes in the market of new computers sold with an OS preinstalled. So the argument is that they can sell any number of the 85 or whatever computers out of a hundred that are not sold with OS X, making the 15 that are sold that way irrelevant.
What?
I think the argument could also be made that the appropriate metric is neither new computers sold nor existing computers but something like share of OS licenses sold
No. The only legally useful metric is market share in the tying product--the hardware.

According to former articles, Psystar purchased fully legal copies of OS X and then installed patched versions of these on their computers on behalf of their customers.
Psystar purchased boxes via legal channels. Anything subsequent to that is illegal.
Apple says that this is copyright infringement to defend their monopoly on providing hardware for their software.
That's not a monopoly.
It's quite obvious that Psystar's argument is sound
It is anything but. Having any knowledge of what American competition law is, actual knowledge of copyright law, and the relevant economic factors in play would be helpful before making broad proclamations with no basis in fact.
The only reason why Apple is not opening OS X to other hardware vendors is Steve Jobs's ego. There is no business argument for that decision.
There are several business arguments for that decision, and the fundamental legal argument is quite straightforward: his product, his decision.
The only thing they could get in trouble for is "illegal bundling" or "illegal tying" of products together.
Psystar's argument fails all three practical elements of tying, with the possible exception of the "two product" prong, because courts often get confused about how to apply the current test.
Even if Apple if found guilty of tying, they don't have to sell OS X at a reasonable price. Just like Apple did with the iPhones in Europe, iPhone with no contract is 999 euros.
Well, it must be a reasonable price, but the actual standard for that is fairly low. It could easily charge $500 for OS X to Psystar, which would roughly eliminate any price advantage--but this is exactly the point. Psystar only gets to offer a price advantage because they don't have any of the costs associated with OS X development or support.
Apple might have to settle for less than 25% margin on their computers if Psystar wins.
No, at worst they'd simply have to settle for product activation, DRM, and increased OS X distribution complexity. Even a victory does not mean that OS X will be available to everyone, but only that Apple has to change its method. If they don't want to license, they won't.
Apple isn't claiming copyright infringement because Psystar is installing Leopard on non Apple branded machines. Psystar hosting a modified 10.5.4 update that it distributes to its customers...that is the basis of the copyright infringement case.
Actually, it's both, in addition to a number of others.

nagromme
Nov 12, 2008, 10:08 PM
I don't really care whether Psystar is allowed to keep going or not--just so long as Apple isn't forced to pay Psystar any attention when it comes to developing and testing their OS. As long as Psystar is selling an UNsupported OS, there's no harm done. Except to Pystar's customers--but that's their choice I guess.

You're afraid that OS X becomes like Windows when it officially has to support non-Apple hardware? Seriously guys, you bought into too much FUD and don't know enough about software development and system architectures if you actually believe this. Besides, since the introduction of NT, Windows is a rock solid operating system when maintained properly. Saying something else is also FUD.

So you would assert that if Apple officially designed and supported OS X for a wider number of models (their own PLUS other companies'), this would NOT add any additional testing or debugging time? That's absurd, since it's clear that even their OWN models add testing and debugging time. That's obvious when we sometimes see an OS X bug that affects only certain systems and not others. The more machines and configs Apple must test for that kind of thing, the more time and money they are spending to do so. That is a REAL cost, and it would indeed slow down Apple's ability to deliver new versions of their OS (which in turn affects their hardware development, app development, you name it).

And on the flip side, if Windows only ever had to run on a handful of specific configurations, all designed BY Microsoft in conjunction with Windows itself, then Windows would be a lot easier for Microsoft to maintain and innovate with.

Choice has a very real cost.

(And when you say "when maintained properly," that suggests that you're talking about effort from USERS, not from the OS developers, which is the point I was discussing. I don't think anyone would deny that Microsoft spends more development hours and dollars on Windows than Apple spends on OS X--and still ends up behind in their ability to deliver innovation, usability and quality. And part of why they're so behind is the chaos of hardware and drivers they have to deal with. One of the prices of "choice.")

What would you say if Microsoft said that Windows would only be allowed to run on a "Microsoft certified computer"? Oops. Forget BootCamp, Parallels and VMWare Fusion. You would be violating the EULA by installing Windows on a Mac. And you would be hating Microsoft even more. But this is -exactly- what Apple does. But strangely enough, that business practice all of a sudden is okay for all the Apple zealots around.

Your own zealotry may be making you see what you expect to see ;) I for one DO see the value of choice in hardware, and DO regret that we don't have that. I just happen to ALSO see the benefits of keeping the OS and hardware as a single product, co-developed together. And I like that choice.

If Microsoft were to switch to Apple's model, and it made their product as GOOD as OS X, designed hand-in-hand with hardware and offering real resulting benefits, THEN it would be "exactly" what Apple is doing--and there would be some value to that scenario, along with the obvious downsides. I'd still complain: because right now Microsoft provides a DIFFERENT business model, and I like that we have that choice. In that regard, I wouldn't want to see Microsoft become like Apple, and I wouldn't want to see Apple become like Microsoft. I don't want to lose the CHOICE to have my hardware and my OS designed together.

As long as Apple's OS team isn't forced to SUPPORT Psystar hardware, I'll be pleased :)

applebum
Nov 12, 2008, 10:22 PM
... There is no business argument for that decision.

Hmmm, how many businesses have you taken from the verge of bankruptcy, made them one of the most recognizable and successful in their industry, eliminated all debt, and put billions in the bank? If your answer is 0, then what is your logic for believing you know business better than Steve Jobs? I understand that you would like more options from Apple, more frequent product updates, and like all of us much cheaper Apple products, but you can't argue with Jobs business acumen. If Steve Jobs believes there is a business reason for not opening OSX to others, then I will trust him long before I trust you.

IJ Reilly
Nov 12, 2008, 11:07 PM
If psystar can hold out a bit longer, then they can start arguing what "market share" really means. If Apple manages to sell 30% of unit PC's in the US for a quarter, would that represent 30% market share under this definition?

No, they might be better able to make this argument if Apple's market share was larger, but there's no magic number. Apple would still have to be shown to have market power, and to be restraining competition. That's a very steep hill to climb.

vastgene
Nov 13, 2008, 05:15 PM
As much as I would enjoy having access to 'cheaper' versions of the Macintosh,
I will now state why I will gladly sacrifice this 'option' (which should not legally
exist without Apple's cooperation).

For years I have read in forums how there is an 'Apple Tax', how Macs are
'too expensive', that Apple is a 'closed system' and so on.

As a long-time Mac (and other OS as well) user, I truly appreciate what
Apple has done for computer users, esp since the advent of OS X.

Consider: HOW does this wonderful OS X get developed?

It takes a lot of money to pay all those engineers to spend all that time
to create such a great OS. In fact, the OS is SO great (in fact, insanely
great!) that 'other computer companies' want in on the Apple Action.

Ask yourself: Does Dell, HP, et al, sell their own OS, which they have
invested huge amounts of money to develop? No, they do not.

Does Apple sell its own OS, which is incredibly expensive to develop?

Yes. And how does Apple finance its software/OS division?

Does this have anything to do with selling Apple/Mac computers?

Yes. Apple sells a good-to-great box, WITH a great OS. And they sell
a lot of them, increasing amounts of them.

It is by this strategy; combine a great OS with a good-to-great box,
for a quite reasonable price FOR WHAT YOU GET, that Apple is able
to finance the business which is thus able to keep doing just that.

Ask: If Apple sold its boxes as 'generic' with NO OS but at the same
premium prices as now, would they sell many of those?

Ask: If Apple were to discontinue hardware sales, and just sell their
OS to anyone who wanted one, would they be able to sell the OS for
$129.99? I mean... if they sold JUST the OS for that price, the same
price they now offer it for... but only to Mac users/owners.

I think not. The way that Apple's business model works so well,
ala Steve Jobs, depends on selling machines AND OS as a bundle.

The 'margins' on selling the machines, actually subsidizes the
software aspect of the business; and it is the software/OS, which
actually sells the machines. It is a perfect symbiosis, and a very
ingenious business plan.

I have used Macs since OS V 3.1, and have done Mac consulting
all along. Since the demise of OS9, I know NO 'unhappy Mac users',
but I know plenty of Windows users who are very, very unhappy,
and several of them have adopted Intel Macs, run Windows on
those, and gradually have become very enamored of OS X.

The 'Mac vs PC' argument still rages, esp in forums, but seldom
if ever have I seen anyone mention what I have above; eg, the
symbiosis of OS/Machine as a viable business plan which ends
up not only supporting BOTH hardware sales AND software sales
at the same time.

Because the software OS X sells Macs, Psystar is trying to
use that software to sell its boxes. Psystar has 'seen the light'
insofar as the Apple business plan, but until they succeed in
writing a usable OS to sell with their boxes, they will remain
just another box seller. They do not deserve to be able to sell
their essentially generic boxes simply because people want
a cheaper 'Mac'. If Psystar does create its own 'good-to-great'
OS (and they could! Really! It just takes lots of money to pay
lots of engineers! Hey, they could use BSD! Why not?) I would
bet they would 'sue' if anyone tried to sell generic boxes by means
of promoting those boxes through the use of the 'Psystar OS'
as a promotional angle.

- Every new Mac sold subsidizes the creation and maintenance
of OS X; and it is OS X which allows those Macs to sell.


-Vastgene

IJ Reilly
Nov 13, 2008, 05:30 PM
Apple needs to win, because if they lose, intellectual property rights would become little more than a bad joke.

SnowLeopard2008
Nov 13, 2008, 05:46 PM
Basically it's like buying an iPhone and putting Windows Mobile on it and then suing Apple saying it doesn't work. Pystar should be shut down, Hackintosh is ok for non enterprise, but doing this on a large scale is infringment. Pystar: I hope you get skinned alive and Apple to throw you in a vat of salt. And then burned to death. To Apple: Long Live Steve Jobs/Jonathan Ive!

TiggsPanther
Nov 14, 2008, 04:57 AM
The 'Mac vs PC' argument still rages, esp in forums, but seldom if ever have I seen anyone mention what I have above; eg, the symbiosis of OS/Machine as a viable business plan which ends up not only supporting BOTH hardware sales AND software sales at the same time.

'Cos it's the part that people either don't know, don't believe, or choose to ignore.

I have to admit, Apple don't make it easy. Yes, the limited hardware set it probably what makes the overall experience somewhat better. But there are definitely holes in their lineup. This makes it harder to defend Apple.

What it doesn't do, however, is make the 'designed together' aspect any less compelling. To me, that is exactly what gives the Mac its advantages. I don't necessarily think that it's the be-all and end-all of what sets Mac about Windows, but I certainly think that the gap would narrow.

I've said it before, but I am all about choice. I don't, however, think that necessarily means 'any OS on any computer'. In fact, I think that that Mac's end-to-end angle is what makes it a good addition to the available choices.
It's not just 'The Cool OS' or 'The OS that runs certian pro media apps'. It's the one that is more intergrated to it's hardware, and not expected to have to run on every permutation of CPU/mobo/GPU/chipset/etc you can throw it at. And I personally think that the market needs that option to be there.

Does that mean I think Apple's current offerings are perfect? Far from it.
But I prefer OSX on the Apple-designed platform. And I know that should I have to replace a computer before Apple give an option I'd fine ideal, I still have many options open to me. Maybe not the exact option I want, but then that just makes it like every other situation out there. I have some choices, and I'll just make the best one from the selection available.

nplima
Nov 14, 2008, 07:50 AM
Apple needs to win, because if they lose, intellectual property rights would become little more than a bad joke.

Great! where do I sign?

K癃sche鯁inq畫
Nov 14, 2008, 08:49 AM
preamble: i am not anti-mac, anti-minix, anti-anything that works for whoever.
As much as I would enjoy having access to 'cheaper' versions of the Macintosh, I will now state why I will gladly sacrifice this 'option' (which should not legally exist without Apple's cooperation).
For years I have read in forums how there is an 'Apple Tax', how Macs are
'too expensive', that Apple is a 'closed system' and so on.closed? AFAIK, macs (ppc or macintel) can run other OSes. of course, the reverse is "controversial" (here). Also, I agree that "tax" is a very stretched metaphor. As a long-time Mac (and other OS as well) user, I truly appreciate what Apple has done for computer users, esp since the advent of OS X.
Consider: HOW does this wonderful OS X get developed?
It takes a lot of money to pay all those engineers to spend all that time
to create such a great OS. In fact, the OS is SO great (in fact, insanely
great!) that 'other computer companies' want in on the Apple Action.
Ask yourself: Does Dell, HP, et al, sell their own OS, which they have
invested huge amounts of money to develop? No, they do not.
Apparently they want in on Ms Win action, because they resell Win pre-installed.
Does Apple sell its own OS, which is incredibly expensive to develop?
Yes. And how does Apple finance its software/OS division?
Does this have anything to do with selling Apple/Mac computers?
Yes. Apple sells a good-to-great box, WITH a great OS. And they sell
a lot of them, increasing amounts of them.
It is by this strategy; combine a great OS with a good-to-great box,
for a quite reasonable price FOR WHAT YOU GET, that Apple is able
to finance the business which is thus able to keep doing just that.
Ask: If Apple sold its boxes as 'generic' with NO OS but at the same
premium prices as now, would they sell many of those?
Ask: If Apple were to discontinue hardware sales, and just sell their
OS to anyone who wanted one, would they be able to sell the OS for
$129.99? I mean... if they sold JUST the OS for that price, the same
price they now offer it for... but only to Mac users/owners.
I think not. I agree that the tie-in is a stronger marketing technique, than independent marketing. The way that Apple's business model works so well, ala Steve Jobs, depends on selling machines AND OS as a bundle.
The 'margins' on selling the machines, actually subsidizes the
software aspect of the business; and it is the software/OS, which
actually sells the machines. It is a perfect symbiosis, and a very
ingenious business plan.mmm, no. Not even if acknowledging that the standards for "ingenious" are very low in the business world... Effective, yes.
I have used Macs since OS V 3.1, and have done Mac consulting all along. Since the demise of OS9, Was os9 that frikked? I really don't know because while info on the old macs is rather hard to find, I haven't seen a huge % of os9 complaints in what I've read. OTOH, there are still active win9x users running current software, while os9(etc) seems to be gone.I know NO 'unhappy Mac users', but I know plenty of Windows users who are very, very unhappy, and several of them have adopted Intel Macs, run Windows on those, and gradually have become very enamored of OS X.Those Win users likely didn't know how to use win. Also from a stat perspective: there is a larger pool of potential win2mac switchers vs the pool of mac2win switchers. The 'Mac vs PC' argument still rages, esp in forums, but seldom if ever have I seen anyone mention what I have above; eg, the symbiosis of OS/Machine as a viable business plan which ends up not only supporting BOTH hardware sales AND software sales at the same time. symbiotic advantage is very often mentioned here on MR.
Because the software OS X sells Macs, Psystar is trying to use that software to sell its boxes. Psystar has 'seen the light' insofar as the Apple business plan, but until they succeed in writing a usable OS to sell with their boxes, they will remain just another box seller. They do not deserve to be able to sell their essentially generic boxes simply because people want a cheaper 'Mac'.
If Psystar does create its own 'good-to-great' OS (and they could! Really! It just takes lots of money to pay lots of engineers! Hey, they could use BSD! Why not?) welllll, i have been wondering if it's easier to get the mac "frontend" (aka whatever) running on various *bsd (already built to run on a relative plethora of hardware), than to h@ckint08hI would bet they would 'sue' if anyone tried to sell generic boxes by means of promoting those boxes through the use of the 'Psystar OS' as a promotional angle.i think they know better than to blow their legal budget on that.
If worried about Psystar or other potentially less-supported osx packages, Apple can simply adjust pricing ratio (os v hardware). On new macs, the total price will remain the same. I can't imagine the ratio adjust will effect gross sales.

K癃sche鯁inq畫
Nov 14, 2008, 08:52 AM
Apple needs to win, because if they lose, intellectual property rights would become little more than a bad joke.intellectual property rights are already a bad legal "joke". :-/

Blue Velvet
Nov 14, 2008, 08:54 AM
intellectual property rights are already a bad legal "joke". :-/

Tell that to the millions of songwriters, writers, designers, coders etc. out there. You want people to provide good content for free?

K癃sche鯁inq畫
Nov 14, 2008, 08:57 AM
"At issue is Psystar's counter claims is that Apple has a monopoly in Mac OS X and they should be allowed to compete in that market. The claim is similar to a claim that General Motors has a monopoly in its Buick "brand" and that other companies should be able to copy and sell Buicks. Incorrect analogy. A better analogy is an upstart maker of hybrids pickups, that buys complete prius from toy then inserts a selection of parts into upstart's final product. btw, if apple opposes psystar, how is psystar getting hold of legal copies of osx? do they buy small quantities from the local bestbuy?

a quote from a comment in that macobserver news url. this is the legal argument that will win for apple:
PsyStar is (as far as I know) legally buying boxes with MacOS X software, that they could then legally install on Apple-labeled computers.

>> they're buying software and installing it on computers which they then resell.

And these computers are not Apple-labeled, which means PsyStar has no license to install the software on those computers.

Tell that to the millions of songwriters, writers, designers, coders etc. out there. You want people to provide good content for free?suggesting that RW application of copyright "defense" is terribly biased, imbalanced, etc. like a law that protects dictators from being spat upon or insulted, while allowing the same dictators to run over toddlers for fun.

Blue Velvet
Nov 14, 2008, 09:51 AM
suggesting that RW application of copyright "defense" is terribly biased, imbalanced, etc. like a law that protects dictators from being spat upon or insulted, while allowing the same dictators to run over toddlers for fun.

And you were accusing others of using an incorrect analogy above? This statement is hysterical hyperbole.

IJ Reilly
Nov 14, 2008, 10:27 AM
Tell that to the millions of songwriters, writers, designers, coders etc. out there. You want people to provide good content for free?

And it's not just content at risk here. Apple is also protecting their trademarks in this case. It seems to be widely unappreciated how integral the protection of patents, trademarks and copyrights are to the development of a product like a Mac. The bottom line is, without intellectual property laws, you don't get products like a Mac. Are intellectual property protections sometimes abused? Sure. But that doesn't justify total ignorance about what they do.

nagromme
Nov 14, 2008, 11:25 AM
Was os9 that frikked? I really don't know because while info on the old macs is rather hard to find, I haven't seen a huge % of os9 complaints in what I've read. OTOH, there are still active win9x users running current software, while os9(etc) seems to be gone.

You're right--and there are two main factors:

1. Windows had (as always) a much bigger installed base than Mac OS 9, so it's no surprise that any given version (even an old one) has a bigger base of users.

2. Macs have made a transition to a whole new processor architecture. That finished killing off OS 9. On PowerPC, you actually could run OS X and OS 9 together (Rosetta) although the need to do so pretty much evaporated and Apple stopped shipping OS 9.

AlmostThere
Nov 14, 2008, 01:33 PM
intellectual property rights are already a bad legal "joke". :-/

Sign me up too - and I say this as someone who does make their living developing software (and I have also described algorithms in academic journals, for anyone to read, and would have a hard time if others didn't also *freely* share their knowledge and experience).

I don't see Apple losing this case but I do not share the view that they have the right to determine how people use their software through an EULA.

IJ Reilly
Nov 14, 2008, 02:42 PM
I don't see Apple losing this case but I do not share the view that they have the right to determine how people use their software through an EULA.

The EULA is a lot less material to this case than you realize. If Pystar was selling the hardware only with instructions on how to install your own copy of OSX, probably Apple would hardly have blinked. What's really at the heart of the matter is that Psystar thinks they have the right to sell Macintosh computers, which lest we forget, is the hardware together with the software. Not either alone, but both together. They don't. Only Apple has that right to sell Macintosh computers, because they own the trademarks. This is why Psystar has based their defense on a fiction -- the so-called "Macintosh compatible computer market."

K癃sche鯁inq畫
Nov 14, 2008, 07:28 PM
And you were accusing others of using an incorrect analogy above? This statement is hysterical hyperbole.nope. it's the kind of silliness that goes to trial too often. and then repugs b1tch about "class actions". "trial lawyers", and "passing on costs to consumers" as if they care...

K癃sche鯁inq畫
Nov 14, 2008, 07:30 PM
The EULA is a lot less material to this case than you realize. If Pystar was selling the hardware only with instructions on how to install your own copy of OSX, probably Apple would hardly have blinked. What's really at the heart of the matter is that Psystar thinks they have the right to sell Macintosh computers, which lest we forget, is the hardware together with the software. Not either alone, but both together. They don't. Only Apple has that right to sell Macintosh computers, because they own the trademarks. This is why Psystar has based their defense on a fiction -- the so-called "Macintosh compatible computer market."aha. i hadn't realize psystar was calling their end product a mac. that's just suicidal.

IJ Reilly
Nov 14, 2008, 11:39 PM
aha. i hadn't realize psystar was calling their end product a mac. that's just suicidal.

They are calling them "Macintosh compatible" and selling OSX pre-installed.

Pika
Nov 16, 2008, 07:25 AM
Do people think that having an OS and hardware specifically designed together is a choice that should not exist in the market?I kinda think this will be the evolution of the industry. Sooner than later as an attempt to crackdown on the flexibility around illegal hacking and ease of copyright infringement, Companies will have to start locking OS and Platforms together. From their point of view, regulation and monitoring will become much easier this way.

I will miss running windows on the Macs I have, but they are bound to do something to stop the ease of programming illegal hardware. In the long run it might even have its benefits. Programs optimized to work with a certain OS and Platform will probably run faster and become more streamlined.

matticus008
Nov 16, 2008, 11:26 PM
I kinda think this will be the evolution of the industry.
Unlikely. Hardware manufacturers are not likely to take on the immense expense of developing and maintaining an operating system, particularly one with proprietary executable formats. Hardware manufacturers also don't care about software piracy, being hardware vendors.

An OS is expensive, and any manufacturer would have to raise their prices to develop one. That's why Windows is everywhere: someone else offered to spend the money and do the work more efficiently in exchange for certain concessions.

Hardware manufacturers themselves frequently commit copyright infringement in their drivers and bundled software. Psystar has taken it to a new level, profiting directly from the millions of dollars of R&D over and above the comparatively small revenue from disc sales, but that's all.
From their point of view, regulation and monitoring will become much easier this way.
Regulation and monitoring of what? From the perspective of software publishers, Windows is their friend because it's a single, large target. An outbreak of proprietary operating systems wouldn't help that at all. As for monitoring users directly...that's just impractical and should be unnecessary.
Programs optimized to work with a certain OS and Platform will probably run faster and become more streamlined.
There's a finite amount of development money in the economy. The more it is divided into separate operating systems with the need for hand-tailoring, the less widespread it will be, because instead of having to develop two or three solid products, you'd be maintaining several.

m1stake
Nov 17, 2008, 12:11 AM
I kinda think this will be the evolution of the industry. Sooner than later as an attempt to crackdown on the flexibility around illegal hacking and ease of copyright infringement, Companies will have to start locking OS and Platforms together. From their point of view, regulation and monitoring will become much easier this way.

I will miss running windows on the Macs I have, but they are bound to do something to stop the ease of programming illegal hardware. In the long run it might even have its benefits. Programs optimized to work with a certain OS and Platform will probably run faster and become more streamlined.

Moving back to the era of computers with all proprietary software is a fantasy, luckily. Before Microsoft took over the os market, every company had to make software to go with their hardware. Nothing was compatible with anything else. Gates was smart enough to just write the software and sell it to anyone, reguardless of hardware. Obviously that business plan worked pretty well, which brings me to my next point: Microsoft doesn't care who buys it because as long as you have an x86 machine, it will work.

Steve Jobs wishes he had that idea. Sure, having total control of the hardware
has it's upsides, but remember which company could buy the other with pocket
change.

IJ Reilly
Nov 17, 2008, 12:45 AM
Gates was smart enough to just write the software and sell it to anyone, reguardless of hardware.

You're giving Gates far more credit than he is due. IBM hired Microsoft to produce DOS for the PC, which IBM never envisioned being cloned. Microsoft's moment came when Compaq figured out how to build an IBM-PC compatible computer without violating IBM's copyrights. Had this not occurred, Gates would have had one customer for DOS and one only -- IBM.

And, FWIW, Apple now has more cash on its books than Microsoft.