July 31, 1997 4:00 PM PDT

Cloners bypass Apple on OS

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Tired of waiting for Apple to act, frustrated clone vendors have taken it upon themselves to ship the Mac OS 8 operating system without Apple's official imprimatur.

Clone manufacturers, much to Macworld saga their consternation, have yet to negotiate a definitive agreement with Apple that would allow them to ship the newest Macintosh OS.

The potentially grave implications for a company if it is not able to move forward with Macintosh technology can be seen in the demise of Exponential Technologies. The maker of high-performance PowerPC processors had to close down its operations because Apple decided not to ship a computer that uses Exponential's X704 processor. Clone vendors wanted the technology but Apple wouldn't license a special ROM (read only memory) chip that allowed the chip to work with the Mac OS, according to industry sources at that time.

"It's like being in bed with an 800-pound gorilla, only the gorilla has epilepsy. You never know when the gorilla will roll on top of you," said a source with a company that was interested in using the processor.

Power Computing isn't going to wait for something like this to happen. It will begin shipping Mac OS 8 preinstalled on systems starting next week, even without a definitive licensing agreement in place. The company will rely on a previous agreement for OS licensing, as outlined in the company's stock-offering documents filed with the Securities Exchange Commission, to ship OS 8. In doing so, the company may beat Apple, which expects to ship OS 8 preinstalled on systems by the end of August.

Motorola (MOT) is working on an agreement that will let the company ship OS 8 preinstalled on recently announced systems, but it currently is planning to send out a CD-ROM with the OS on it. (Customers can then install the software themselves.)

Umax Computer Corporation will apparently take a more cautious route. "Umax has in their current license discussions the right to ship OS version 8," said a Umax spokesperson. But "Umax will work within agreements they've negotiated," he added. There is no official word on when the company will ship systems with OS 8 at press time, but the company probably will not be as aggressive as Power Computing with its rollout, preferring to work with Apple's approval.

The artful maneuvering by some vendors underscores the clone vendors' desire to ship the newest release to customers, but it has an importance that extends beyond the new OS's look and feel and enhanced functions.

The Mac OS 8 is an important release for clone vendors since it is part and parcel of the Common Hardware Reference Platform (CHRP), also referred to as the PowerPC Reference Platform. Mac OS 8 and CHRP-compliant hardware are key technologies that will allow Mac clone vendors to enhance system performance and introduce innovative products more rapidly--and thereby compete with Apple more effectively.

The end of relying on Apple for core technologies and hardware comes none too soon for some of the companies.

For clone vendors, Mac OS 8 signals the end of the clone era, according to Motorola. "[The market until now] was a good way to start the clone market. Now we can use CHRP and other technology to allow us to innovate," said Michael Bordelon, vice president and director of desktop products for Motorola, in a previous interview with CNET'S NEWS.COM, implying that Motorola now intends to break away from Apple.

According to the documents filed as a part of Power Computing's IPO, the clone maker revealed it is also sublicensing the Macintosh OS from IBM.

The deal was struck partly as a means to ensure a steadier supply of systems to customers. Power Computing signed this agreement with IBM about seven months ago, even as it was in licensing talks with Apple to use the Macintosh OS 8, according to sources close to IBM.

This is all happening against a backdrop of clone manufacturers taking up to 30 percent of the Macintosh hardware business, which eats into Apple's revenues. And with the CHRP-compliant OS 8, clone vendors will no longer have to buy hardware platforms from Apple. To compensate, say industry sources, Apple pushed for 200 to 400 percent higher OS licensing fees.

 

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