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Psystar Files for Bankruptcy
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It's not "all or nothing" as you infer. If Apple continued to support a handful of hardware as it does now, but allowed Pystar to sell computers with OS X, things wouldn't be so miserable as you suggest.
Same hardware components, but different manufacturer. Competition.
I bet they don't even show up in court....
In actuality, the bankruptcy schedules filed with the court should already list anyone who has an ownership interest in or is a creditor (ie investor) of the company. The hearing on June 5th, called a 341(a) Meeting of Creditors, allows the Judge and Creditors to ask questions about the finances of the debtor company. So theoretically, Apple could show up and ask the debtor (Pystar) some questions. They likely will not, however, as the information they get back is likely already listed in the filed pleadings.
That said, it couldn't hurt to show up and ASK them...
They tried licensing back in the pre-X days. See: Power Computing, UMax, et al. It didn't last very long or go over all that well.
I'm neither a fanboy nor a fanboi, but I am a consumer, so I feel I can represent at least myself.
As a consumer, I "win" in that Apple has protected their intellectual property - intellectual property I find enough value in to pay a "premium" to be able to gain access to it through OS X and the Macintosh computer.
Many people in this forum and others claim that the only thing holding back Apple's success is the price they charge for their product. And many on this forum believe that Apple cannot succeed without a cheap $1100 "gaming box" (where $1000 is the video card and $100 is everything else).
Well, Psystar gave the consumer both, and the consumer appears to have rejected them.
Does this mean that the consumer doesn't want a cheap Mac or a "gaming box"? Likely not. But it does seem to imply the consumer understands why an Apple costs more then a Windows or Linux box of similar hardware configuration and given the choice of a less expensive, but less impressive option to an Apple product, they will choose the Apple product.
And it's not just computers. There are plenty of MP3 players significantly cheaper then the iPod, and yet Apple owns that market. You can find cheaper smartphones then the iPhone, and yet Apple continues to make strong gains in marketshare.
As much as the computing world likes to claim those of us who own Apple products are snobs with too much money and too little sense and that Apple plays on our inflated views of self-importance to fleece us for hundreds and even thousands of dollars, the fact is that Apple products, services and technologies provide us with something of sufficient extra value to justify the extra price.
OS X may be just an operating system, iWorks and iLife may just be productivity software suites, and a MacBook Pro or iMac might be just a computer, but the sum is greater then the parts. And when you compare the retail prices of OS X, iWorks and iLife to Microsoft Vista Premium, Microsoft Office Professional and the individual applications from various vendors you need to buy to equal iLife, the real deal proves to be Apple...
The only possible problem, which would detract from my enthusiasm of Psystar going into bankruptcy is that they may emerge from it. Good for Apple,they wouldve won as Mac OS X was created by them, and should only be bundled with their computers, as they made it and should hold distribution rights.
How would you know what people did? Do you have Psystar's sales receipts to compare them with Apple's? Apple sells more than just computers, after all and all computer sales (that aren't netbooks) are down right now. Psystar clearly lacks Apple's advertising budget as well, so this inference that somehow Psystar just plain sucks is ridiculous, especially in light of the positive reviews that have come from various sources that have reviewed them.
The legal question hovering over Psystar (particularly with Apple demanding all buyers return their PCs they bought) didn't help encourage sales regardless. The NEED for Apple to play straight in a Capitalism market (that means COMPETITION not trying to sue your way out of competing, BTW, which is all Apple wants to do to "compete" against other hardware manufacturers...by preventing them from playing on the same playing field. And spare me any its their OS arguments as it's already been ruled ILLEGAL to use one market to leverage another market also known as "tying" and that is EXACTLY what Apple is guilty of when you make that argument since hardware and software are two separate market shares as evidence by innumerable companies that only do one or the other).
I don't care about Psystar in particular, but I do see a big need for SOMEONE to drag Apple's sorry excuse for a legal team to court over this issue because they have NO RIGHT to monopolize a segment of a market. What market segment? I'm talking about generalized computer hardware that is fully capable of running their operating system. The fact Apple's offerings can run Windows and Linux and that they "allow" that but not the opposite in return shows their disdain for the laws of this country. "Separate but equal" is the argument thrown forth by the Apple legal team and its fanatical supporters. In other words, they argue that their competition is HP, Lenovo, Dell, etc. even though those companies have nothing to compete for hardware sales to Mac users. In other words, if I own a Mac software library (which could possibly contain no software from Apple except the operating system and what ships with it), I HAVE to keep buying hardware from Apple in order to keep using that library or give up that library entirely just to get mid-range tower hardware option, for example, even though there is no technical reason that mid-range tower from Dell cannot run OS X. We simply have Apple sitting there saying "too bad, you MUST buy all your hardware from us or give up all your existing software" even though the software has nothing to do with Apple hardware, only their operating system, which they continue to sell at retail through chains like Best Buy and which I already own from the previous Mac I may wish to replace with a newer computer.
Apple then leverages that unfair market advantage to raise prices in a recession where others have to lower their prices in order to increase their profits to record levels during said recession. Over $29 BILLION in cash reserves proves the level of gouging they engage in. Even Gene Munster of Financial Week stated, It's outrageously high. You don't get those kind of cash reserves without either cheating your shareholders of their dividends or gouging the consumer through the fact of having no competition for your hardware (due to the need for the software that is not "allowed" to run on competing hardware). Illegal tying needs to be challenged and shot down in court for the good of the marketplace and ultimately the consumer, who is supposed to benefit from competition not the complete and total absence of it due to illegal tying by companies like Apple that would rather litigate than compete in the market place.
Any other position on this clear, cut and dried legal issue is clearly a radical fanatical position that only supports "love" for all things Apple since the consumer laws on this practice of tying have already been ruled on in the past. The fact that one "loves Apple" and doesn't want anyone to compete with them is not a supportable defense and that is the ONLY defense I've EVER seen on this issue from those that claim Apple has done no wrong and has the "right" to gouge, litigate and abstain from fairly competing on an Apples to Apples and Oranges to Oranges basis (because hardware and software are two SEPARATE market shares). No Apple wants their Apples and their Oranges in the same basket where they do not belong. If Apple's operating system is as great as the fanatics claim, it does not need the hardware tie-in to succeed and if Apple's hardware offerings are as great as the fanatics claim, then it does not need the operating system to compete in the market place. Both should be capable of standing on their own merits. Entire companies are based on those single merits including the supposed "competition" on both segments (i.e. Microsoft for the OS and HP, Lenovo, Dell, etc. on the hardware side). The fact Apple has its feet in both markets should not allow them special privileges to restrict competition on either segment alone. No, each segment MUST compete on its own merits or you have that "tie" that has already been ruled illegal in a previous case.
Apple's lack of hardware choices for the consumer would NEVER STAND on its own at the current price levels nor would the price levels stand if they actually had real Apples to Apples competition in the hardware segment of the market place. Why would any non-professional spend $2500 on a 4-core Mac Pro when they could get mid-range computer for $1000 that performs BETTER than that same machine with the same operating system? It simply would not happen, but if you believe it would, then where is the harm in allowing that competition since people would choose Apple? The fanatics never answer that question, but evade it with the typical "it's their OS and they can do anything they want in the whole wide world regardless of consumer laws that are designed to prevent such things". But the Mac Pro is not a consumer machine, you might say. True, but there is NO OTHER CHOICE for the consumer if they want an expandable high-powered desktop machine that runs OS X. Apple offers no alternatives what-so-ever to that market segment and only proves that they need competition to both keep their prices in check and also their design decisions, which should serve their customers, not just their bank accounts.
Furthermore, the fan argument is that there aren't enough buyers to warrant a mid-range tower and that's why Apple won't offer us one or that it would usurp sales from the overpriced Mac Pro. So if the market is so small, then why not let someone like Dell service it? Up until this year, tower desktops have been the #1 seller for the PC industry. It's still just below notebooks/netbooks. That's almost 50% of the market. Apple ignores it or tries to tell us an iMac IS a desktop when in fact it's just a laptop in an big monitor that cannot close (essentially an over sized tablet that doesn't run on batteries). No, Apple knows that people would plainly see how overinflated their prices are (which again is why they have over $29 BILLION in cash reserves when just ten years ago they were on the verge of bankruptcy) if a mid-range Apple tower sat next to an HP at Best Buy and the Apple one cost $500-800 more just because it's an "Apple" with no other hardware advantages so they avoid the comparison entirely at such places and simply don't sell towers there. This is exactly the approach Microsoft has been taking with their notebooks since you can plainly see there that Apple's offerings cost more and have less features that are important to the average person (e.g. HDMI, expanded memory by default, higher quality web-cams, etc. and offer what in return? Reflective screens? Removal of firewire? Ridiculous ram upgrade prices from the manufacturer? Almost no warranty unless you pay a LOT extra for it? Yeah, those are great "features" alright).
I don't bash the Apple operating system. I think it's the best one out there for consumers. But liking an operating system doesn't mean I have to like Apple's anti-competitive practices and price gouging that is a direct result of that lack of competition. I'd rather see Apple charge more for the operating system (and please no BS comparisons where you inflate the operating system value to MORE than an entire computer that Apple sells WITH the operating system--that's just plain stupid, IMO. In other words, OS X cannot possibly sell for more than $599 since the Mini sells for that with the OS and includes hardware to boot. Thus, the value of the OS must be $599 - the at-cost hardware price of the Mini at MAXIMUM). That means around $300 at MOST. I'd gladly pay $300 for OS X if it meant I could buy any hardware I like to use with it (within the driver constraints of OS X; I'm not suggesting Apple support everything out there like Microsoft, simply that I can buy a compatible computer from a competitor at my own risk). This is because as I mentioned earlier, I can easily get a computer that outpaces a Mac Pro in the areas important to me for under $1000. Even with a $300 OS purchase on top of that, it's STILL over $1000 less than a Mac Pro. No, it's not the same machine, but it's better for the things *I* need, not the things Apple wants to sell.
The truly sad part of this is that Apple could license out OS X to someone like Dell to cover the areas they do not support currently like mid-range and low-end towers and make $129-300 + licensing cost from Dell for each computer with no manufacturing costs what-so-ever to them. That's PURE PROFIT from a market segment they do not even support AND it would increase their market share, which hedges bets against Microsoft for the future since more market = slower fall if Microsoft's next OS is much better received than Vista. But no, Apple wants to control the entire market segment, which is akin to a monopoly for that segment. This will bite them in the butt in the future when Microsoft inevitably releases a better OS. It already happened with Windows 95/98. Vista has given the Mac a big break, but it will not last forever. They should be trying to build market share like mad. They are not even CLOSE to the share levels they had before Windows 95 came about (close to 20%) and even that share level did not save them from dropping to 4% when a better mouse-trap came out.
Yes, the iPhone is nice, but that's not their core profit maker and even the iPhone won't be state-of-the-art forever. But look at Microsoft. They can blunder badly like with Vista and still not worry much because they have 90% of the market that is dependent on their OS. Even if you buy a Mac and run something like Parallels or Fusion, you STILL have to buy a copy of Windows to run your old software so Microsoft wins a share regardless and the Mac just breaks even. That's the advantage of a virtual monopoly on a market and Microsoft DOES have competitors for the OS (namely Apple and Linux). So how much more does Apple have a monopoly on hardware for OS X when there are no competitors? Yes, Apple is under 10% of the market, but 100% of 10% is a LOT of money and their cash reserves and manufacturing numbers show that is absolutely the case. Therefore, one cannot argue they are too insignificant for anti-trust rules to apply...not when they are consistently in the top 5 hardware manufacturers despite having a segment that is unrelated to the 90% segment of the OS share. A lot of computer sales is a lot of computers sales. But they would not be so high on that list if they had actual competition for the hardware segment of the OS X market place. Call it a segment or sub-market, but the fact is Apple has almost 100% of that market share (minus Hackintoshes and until now Psystar).
And what if Apple ever did eclipse Microsoft for OS market share? Do you think the courts could turn a blind eye then to the fact that no one else is allowed to sell hardware for the OS X operating system even though that hardware is IDENTICAL to that of both Windows and Linux? There is NO WAY ON EARTH it would stand at that point. They'd be in even bigger trouble than Microsoft was. So what's the difference in the opposing argument? Their OS share is too small so we should allow them to monopolize all the hardware for that share out of pity? They're making more profit than Microsoft right now! You don't need a lot of OS share if you get 100% of the profits from that share's hardware segment.
Can a fanboy tell me how the consumer wins in this case? Reading half of these comments make me sick... like people on here live to please Apple. For god's sake, who gives a sh*t if another company is trying to give us some lower cost mac clones? As much as you want to believe it, i dont think anyone here can make a case of how little teenie psystar made even a microscopic dent in apple's stock price. You don't have to feel bad for apple... they only need to look at the balance of their bank accounts to to turn their frowns upside-down.
The issue is one of precedent. Sure, Psystar wasn't doing anything that would really hurt Apple. But if they won their case, I'm sure that before long you'd see Dells with Mac OS X preinstalled, and Acers, and corner-build-it shops, too. Yes, Mac OS X might see a boost in marketshare, but it would pay for that in the loss of tight integration between hardware and software. Apple would be forced to make a decision about how to handle the issue, either take steps to lock the OS to their hardware more tightly, or deal with all the sub-standard hardware issues that would come up from having their OS running on any old piece of hardware. Neither is a good result, from the stand point of the consumer. Right now, if you know what you're doing and understand the shortcoming of such systems, you can build a very inexpensive 'Hacintosh'. As such a person, you'll know that you can expect some compatibility issues that probably have nothing to do with the quality of the OS. Someone who would be a computer from Dell, for example, wouldn't necessarily be in as good a position to understand that.
There are many different kinds of competition. One is certainly the "I can do that better!" kind, but another, which is the one that Psystar was engaged in, is the "I can do that cheaper!" kind. The flaw is, of course, that what they were really saying is "If I ignore the rules that you have set, then I can do that cheaper!", and that's where Apple is getting them.
The difference is Phoenix actually made a concerted effort to not infringe on the intellectual property IBM held with the PC BIOS. They created a "clean room" version of BIOS that, while providing similar functionality to IBM's BIOS, did not use IBM intellectual property to do it. So IBM had no legal grounds to sue them nor companies like Compaq who used the Phoenix BIOS to create PC clones.
So if Psystar had developed a "clean room" implementation of OS X that did not use Apple code, patents or other intellectual property, they would have been in a very strong legal position to offer clones.
But they didn't. They took the easy and cheap route and just circumvented and subsumed Apple's intellectual property. They just hoped Apple would ignore them.
You've been typing that since I posted, haven't you?
It's over; no sense in arguing anymore. Not a monopoly. Toyota doesn't have a monopoly. Sony doesn't have a monopoly. Heck, even Microsoft doesn't have a monopoly... because people ALREADY HAVE A CHOICE.
Could you please point me to the section of the Microsoft Windows XP and Windows Vista EULAs that specifically prohibit the installation of those Operating Systems on Apple-branded computers?
And can you point me to an EULA, period, for Linux?
Just because Microsoft is willing to whore it's software to any platform willing to write MS a check doesn't mean Apple's refusal to do so is "illegal". If and when Microsoft writes their EULA to forbid installing it on Apple-branded computers, I will remove it from my Macs. Until then, Microsoft agreed to take my money in exchange for installing their OS on them.
You've been typing that since I posted, haven't you?
It's over; no sense in arguing anymore. Not a monopoly. Toyota doesn't have a monopoly. Sony doesn't have a monopoly. Heck, even Microsoft doesn't have a monopoly... because people ALREADY HAVE A CHOICE.
Agreed. Keep saying Apple is a monopoly is just trying to beat a dead equine style of argument.
Can a fanboy tell me how the consumer wins in this case? Reading half of these comments make me sick... like people on here live to please Apple. For god's sake, who gives a sh*t if another company is trying to give us some lower cost mac clones? As much as you want to believe it, i dont think anyone here can make a case of how little teenie psystar made even a microscopic dent in apple's stock price. You don't have to feel bad for apple... they only need to look at the balance of their bank accounts to to turn their frowns upside-down.
Yeah, because we should all encourage small companies to steal another company's property as long as "the consumer" gets a lower price--because lower prices are all that life is about. I'm guessing you don't have any intellectual property to protect.
A little something from the guys at Gizmodo.
Click it to see full resolution
Giz illustrations are always hilarious. Love 'em.
1) Not buy enough Psystar crap. The whole bankruptcy thing kind of points to that.
2) Apple is in total compliance with the DMCA and US Intellectual Property laws, always has been, and it has also been ruled (more than once) that they are neither a monopoly, nor are they abusing their position. Or were you referring to some other kind of law?
All I've got to say is good riddance !! They made an ugly Mac.
The fun part will be seeing who was behind this.
The fun part will be seeing who was behind this.