Apple cloning: Worth it?

It doesn't take much to put Apple in the news, and this afternoon's excuse is that a Miami-based company called PsyStar is selling a Mac clone.

Its Web site was down earlier--ostensibly because of the overwhelming reaction to its product. As Computerworld's Gregg Keizer reports:

Before its site went dark Monday, PsyStar was pitching an Intel-based system it said could be configured to run Leopard, Apple's Mac OS X 10.5. The machine, which was priced at $399 minus Leopard, $554 with it already installed, is powered by a 2.2GHz Intel Core 2 Duo processor and includes 2GB of memory, a 250GB hard drive, optical drive, and on-board graphics based on Intel's Graphics Media Accelerator (GMA) 950 graphics processor. The GMA 950 is part of several Intel chipsets--notably the 945 series--that are popular on PCs designed to run Microsoft's Windows.

There are a variety of issues here:

• Are Macs really overpriced these days, compared to a truly comparable Wintel alternative? (Certainly far less than in the past.)

• Is OpenMac a trademark violation? (Seems possible. I am not a lawyer.)

• Are any possible savings worth getting a PC-Mac OS combo that the Apple won't support? (Not from where I sit.)

• Does PsyStar have the right to preinstall an operating system for which it (apparently) doesn't have an original-equipment manufacturing, or OEM, license? (Seems dicey.)

But I wanted to focus on one issue in which I have some personal experience.

The Mac OS X end-user license agreement prohibits its use on hardware other than that sold by Apple. It reads, "You agree not to install, use, or run the Apple software on any non-Apple-labeled computer, or to enable others to do so."

A little legal history now. Way back in 1978, a company by the name of Digidyne brought suit against Data General, alleging that it was restraining trade by "tying" its RDOS operating system to its Nova minicomputer hardware. (Digidyne sold Nova clones.)

The case wound its way through the courts. A 1984 Ninth Circuit Court of Appeals decision held for Digidyne; the case was later denied rehearing by the U.S. Supreme Court.

It was a convoluted court case, but the bottom-line result was that Data General could not prohibit the use of its operating system on someone else's hardware. To use the legal term, you could not "tie" hardware and software. Related cases have involved prohibiting the use of specific supplies (such as punch cards) with a specific vendor's hardware.

My personal history here is that, at one point in my career, I spent many hours with huge Lotus 1-2-3 spreadsheets, working to unbundle Data General minicomputer operating systems from the hardware on which they ran--and to do so in a way that was hopefully approximately revenue-neutral, as well as not too annoying to any customers.

This was, of course, a wholly different generation of hardware and software than was in place at the time of the original lawsuit--and there were no actual Data General hardware clones any longer. But nonetheless, it had to be done.

Does that mean that Apple's end-user license agreement clearly breaks the rules? Well, few things are crystal-clear, when it comes to legal matters. In this 2006 post in InfoWorld, James Bailey's quoted comment gives a good precis of the relevant issues:

First, DG lost because RDOS was the only viable operating-system software for Nova and any clones. There was no other reasonable OS available for the clone makers. Dell can hardly claim the same, considering that they currently ship both Windows and Linux. Claiming that those two OSes are not "uniquely desirable by buyers" would be a stretch.

To quote the 9th circuit decision: "Although expressing some doubt as to the sufficiency of the evidence, the district court assumed defendant's RDOS was superior to competing operating systems and was viewed as uniquely desirable by buyers. 529 F. We do not share the court's hesitancy about the adequacy of the proof of the strong preference of many customers for RDOS. It was a most popular product."

Even DG admitted that there was no viable alternative. Again from the record, "the only full-service operating system available for the Nova."

Second, the court determined that to re-create RDOS would be prohibitively expensive and probably not practical. Again, with Linux and other free operating-system software readily available, it is hard to believe that the courts would come to the same conclusion in the case of Apple and OS X.

Bottom line?

Apple's end-user license agreement may or may not be an issue. The tying of hardware, software, or services has generally been frowned upon by the courts. On the other hand, the ultimate resolution resolves around specific facts about market power and the like. And, in any case, there would seem to be far more immediate questions about the PsyStar approach than those that would only be resolved by multiyear court cases (which would inevitably favor Apple, in any case.)

The fundamental question, perhaps, is this: in a world where Apple has moved to Intel processors, brought its pricing much more in line with comparable competition, and is, well, cool, how much opportunity is there for an unsupported cut-rate clone, anyway?

[dredgerie]

I've been looking to buy a new mac for a while now. I currently have a G4 mac mini that I'd like to upgrade, but unfortunately, I can't because of the way it's built. I already had to buy a new monitor and keyboard and mouse and speakers when I bought the mini just a few years ago, should I really be expected to buy an entirely new setup just because I want a faster processor and more RAM? The argument could also be made that Microsoft had the majority share of pc's and therefore is the standard, so any deviation that Apple makes from it is an attempt to screw the customers for profit. Yes, Mac is worth a little extra in my opinion, but since I want to use my existing screen, should I have to spend 3 grand to buy a new mac when someone else is offering me the choice to get a comparable setup for a quarter the price? Furthermore, can Apple really expect this out of their client base? I love my mac, but I've spent a lot to switch over from windows, and to make the upgrade in windows that I want to make now with Mac would cost me about the same as what Psystar is offering. If Mac wants to kill them off, fine- but give me an alternative that's somewhere in the middle. I'll gladly pay more for a genuine product, but the real product I'm looking for is the software- so if I can get the hardware anywhere for 75% off, I'd have to be crazy not to.

[fokkwp]

Since the Mac first came out, users have been seeking a "Hacintosh" that would run the OS on cheaper computers. Personally I think Apple is well within its rights to limit its OS to any conditions it likes, given the huge availability of alternative OS's.

Cost? Yes, Macs have come down to near-parity with PCs. BUT - if you do go out looking for a low-cost, high-power computer you will end up with a PC every time because someone always has one on sale somewhere at a bargain price. There are so many Windows computer manufacturers in competition that you can always find a really good, low-cost PC if you shop around. If you already have a monitor, you are wasting your money buying one built into an iMac - another factor that makes a replacement PC way cheaper in many cases. In addition, the available inventory of low cost near-new refurbished computers is far higher for Windows computers because there are so many more. So whenever you are looking for anything other than a full retail top-end computer with monitor, you can probably spend a lot less for a PC.

[ghaff]

I fully agree that if you're just looking for a basic PC and aren't too fussy about the specifics there are great bargains to be had. Not really applicable to the Mac clone case unless a broad market developed though.

[gregorytga]

Having toyed with the OSX86 project, really Apple doesn't need to bother protecting their OS at this point. hackintosh OS X86s are no where near the same user experience, often with plenty of obscure Kext hacking, partially functioning hardware and problems updating.

For most people its just not a realistic option. There are some who've actually taken the time to create mostly solid machines by buying selected hardware. Unless Psystar is willing to include update patches to ensure compatibility with future updates, for later iterations of OS X 10.5.x its not worth it.

[john_spence]

Could this be the rise of other companies producting Apple clones? If it comes about, this could mean that Apple would be selling many copies of their OS. Could they become a software company rather than a hardware one? They could be in direct competition with MS. Linux is not a viable alternative for the casual user, but Apple OS is. If the court rules in Psystar's favor, MS could be shaking in their boots. Is Leopard better than Longhorn?