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Mac Clone Maker Psystar Files For Bankruptcy
StikyPad was one of several readers letting us know that Psystar has filed for Chapter 11 bankruptcy protection. We've discussed the Mac clone maker's battles with Apple extensively. The company apparently has over $250,000US in debt, and states that it cannot turn a profit in the current economy. "The Chapter 11 filing will temporarily suspend Apple's copyright infringement suit against Psystar, which is currently before the US District Court of Northern California. But once the bankruptcy protection is sorted out, the copyright case will resume." And PC Mag is reporting that, on the other side of the Atlantic, two new clone companies are just getting started. Like PsyStar, FreedomPC and RussianMac promise to deliver PCs with OS X preloaded.
Windows just isn't ready for the desktop yet. It may be ready for the coasters that you nerds use to sit your colas on, but the average computer user isn't going to spend hours in the dos cli configuring irq numbers and io addresses, dealing with constant crashes and manually installing networking support just so they can get a workable graphic interface to check their mail with, especially not when they already have a free alternative that works perfectly well and is backed by major corporations like Redhat and Canonical, as opposed to Windows which is only supported by Microsoft. The last thing I want is a chair-flinging gorilla (haha) providing me my OS.
The company apparently has over $250,000US in debt.
That must be a typo - could they mean $ 250 million USD ? Most companies would not
choke on $ 250,000 worth of debt.
Why would anyone want to run Mac OS on unsupported hardware? It's going to be unstable, missing features, and chances are that getting updates from Apple to install with or without hosing your installation is going to be a bitch.
If you want OS X that bad why not just buy a Mac?
Clearly they only have one chance left to survive. They must clone Steve Jobs!
Until out of chapter 11.
That is the biggest question. They couldn't undercut Apple in the market segment which could mean that Apple's are well priced for what they have to offer? Too little people interested in non-Apple Mac products which could mean that they didn't offer the same service as Apple does or their products were of lower quality? Or did their management just drink all profits that should've been used to expand the company and pay for in-house lawyers?
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. . . if I owe a bank $250 million, the bank has a problem.
Schroedinger's Brexit: The UK is both in and out of the EU at the same time!
I dunno. The "Apple suing them in the face" problem was a pretty serious one, and is probably what did them in in the end; but their business model is by no means a certain failure.
PC assembly is a fairly low margin business; but there are plenty of companies, large and small, that make a living at it. Psystar had the advantage of massive word-of-mouth and R&D done for them by the hackintosh enthusiasts. Were it not for the legal trouble, I would assume that (barring specific incompetence) they could have carried on for a fair while.
This is a point worth considering. A similarly important point, where is the money coming from for the non-U.S.clones?
The most simple explanation is $250,000 in debt happens very quickly once the lawyers bills start hitting the books
http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
Apple has promised there will not be chip level lockdowns in OS X, or any future apple OS. their OS runs on commodoty hardware, they only license it to run on Apple Brnaded systems (currently). It;s been rumored for years that Apple is partnering with dozens of vendors and plans to release an OS X approved spec and sell OS X on shelves opposite Windows (likely on a price tier competitive to Home Premium, but including iLife).
Apple has not released OS X for open systems for 1 primary reason: they don;t want to support your junk kit, and they don;t want to get the blame for OS X having stability issues. If manufacturers are allowed to be held to the same wishy washy standards as micsoft, then not only would OS X be seen to be just as unstable, but it would likely be sold on many systems that don't really meet the minimum specs of iLife, and would provide a lack-luster performance.
The hardware market has been shrinking (unified drivers, fewer verndors, better driver certification, open standards). In a couple of years, especially once dedicated GPUs become the norm across all systems, and when comodoty $500 PCs have significant specs, I expect to see Apple come pre-configured, OEM, on select systems, but by that point, Apple hardware should also be slightly more in line price-wise (on several systems, Apple is actually currently cheaper than the competition, especially in the pro and server lines, but on the low end there's still a premium for the design and software).
There is no contest in life for which the unprepared have the advantage.
I dunno. The "Apple suing them in the face" problem was a pretty serious one, and is probably what did them in in the end; but their business model is by no means a certain failure.
I don't understand this opinion. So let's say in the best case, most realistic scenario Pystar and these other companies get the relevant provisions of Apple's OS X licensing declared unenforceable and they are removed from the license. They are now in the business of competing with Apple to sell hardware, while having to buy the OS from Apple. If they become moderately successful, what is there to stop Apple from no longer selling boxed copies of their OS and thus killing them?
Seriously. Selling boxed copies of OS X is a small part of Apple's business. They could switch to online distribution for upgrades and use DRM to prevent them from installing. End result, Pystar and their ilk die and Apple's customers are inconvenienced with DRM. Gee, thanks guys.
Or, Apple could go a more drastic route. They could simply ditch selling new versions of OS X and provide them free of charge to all Mac owners. It would barely dent their profits and lower their support and development costs considerably. Or they could take a middle road and sell a yearly service like their ".mac" service and include in that service upgrades to the OS and network services like e-mail, but provide no other upgrade path for individual licensors. Either way Pystar dies and Apple moves on without worrying about being undercut.
The way I see it, if Pystar and the like succeed, all they do is drive Apple to change policy enough to kill them. Any business model built upon being successful but not too successful lest the company you rely entirely upon kill you, is a doomed business model.
You can build a Hackintosh yourself. Bootloaders and such are out there - you can run Leopard on a regular PC, as long as you are careful to only use supported components. Amazingly enough, Apple has been remarkably nonchalant about this. So why do they have such a big problem with Psystar?
Running OSX on a white-box PC takes technical know-how and a willingness to put up with some level of brokenness. This is the polar opposite of 99.9% of Mac buyers, who want their computer to just work - that's why they bought a Mac in the first place. So Hackintoshes do not meaningfully decrease Mac sales - indeed, they might even (very) slightly increase Mac sales because they get people invested in the Mac ecosystem. (Once you've wrangled with getting OSX to run on your white-box PC, only to have to do it again for the next point update, the convenience of a real Mac starts looking like a pretty darn good upgrade.)
The problem with Psystar is that they were promising to make their white-box Mac clones easy to maintain, thus destroying the selling point of a real Mac.
"Macs are over priced, but people pay that premium because they want an Apple product."
Your statement seems to contradict itself. If something were overpriced then it would cost more than the market would pay for it, slowly leading to the demise of the manufacturer. But as you note, Apple products seem sell reasonably well, even at a perceived price premium. That would lead me to conclude that, from a market perspective, their products are not truly overpriced.
If a company offers a product that the market percieves as superior, people will pay more for it. This applies to everything from dairy products to automobiles to consumer electronics. The fact that Apple is able to sell products for a reasonable profit isn't really much of an argument against them or their products.
Now if you'll excuse me, I'm going to drive my over-priced Honda home and watch my trendy, over-priced and fashionable Sony HDTV. (no, not really)
I'm an Apple investor too, and I'm not so appalled.
The differences between, say, the iMac and Mac Pro:
1. > 4GB of RAM
2. > 2 CPU cores, and they're faster
3. PCIe slots
4. 4 internal hard drives
5. Up to 2 internal optical drives
Now, I'm sure this is going to be controversial, but I'll pose the question anyway:
What would you really want to use those PCIe slots for that you couldn't find reasonably equivalent functionality via USB or Firewire? Bonus points if there are mac drivers available.
If the answer includes Gigabit Ethernet (note that we'd be talking about a *second* GigE port, since the iMac comes with one), Fiber Channel or RAID, then doesn't that imply that you'd be better served by either the Mac Pro or an XServe anyway?
What else is on the list?
SCSI? Really?
Fusion powered 3d graphics card? Are gamers really clambering to run awesome 3D games under OS X?
TV tuners and video capture? There are plenty of those for USB, FW or Ethernet.
What I'm saying is that the "mid tower" you describe *likely* doesn't differ significantly from the iMac except for not having a built-in display, those PCIe slots and extra optical and internal drive bays - and in the case of the optical and/or hard drive bays, FW800 is an alternative. And I am honestly struggling to think of why those PCIe slots are missed.
I can certainly understand that you want an expandable machine, and want to run OS X, and want it to be under $1500 -- those are pretty reasonable desires from a power-user computer owner. But I'm not sure you outrage is justified as an investor -- Apple seems to be doing pretty well selling non-expandable machines in the mid-range, and they have been for years. If Apple was primarily in the market for budget-oriented power-users it would be silly to not offer a cheaper tower, but they're not, and it's probably not a great business strategy for them to try; there's a very real chance it would hurt their sales and confuse their marketing in the other, well-established, successful market segments where the currently operate.
Psystar had the advantage of massive word-of-mouth and R&D done for them by the hackintosh enthusiasts. Were it not for the legal trouble, I would assume that (barring specific incompetence) they could have carried on for a fair while.
I agree that they had major name recognition, but that recognition equated to them being labeled "the guys who are pissing off Apple by making clones" and not "the guys who are making awesome, cheap Mac clones that I want to buy". The members of the /. community that enjoy Macs do so because of the technical merits (UNIX underpinnings, efficient GUI, etc. [don't flame me]). The rest of the world likes Macs because they're "cool" and they don't necessarily define that "coolness" explicitly. So, if a /.er wants the technical advantages of having a Mac without the price, they go for a hackintosh. The problem there is that a /.er is probably just going to build that hackintosh him/herself rather than pay Psystar for one. Not only is it cheaper, but you get to learn something in the process. The rest of the world would see a Mac clone and say "that's not a Mac! It's not cool!" and move along.
When I hear "normal" people complain about Macs, what I hear consistently is "I wish Apple would make a cheaper Mac", not "I wish some other company would step in and compete with Apple to drive down the price." What I'm trying to say is that the market for pre-built hackintoshes is tiny. Of all the people I know, both technical and nontechnical, I can't imagine any of them buying one.
Lies. They've never used the TPM chip. They've always relied on modern computers having EFI disabled. (Most computers ship with the Framework, which is EFI based, but EFI support is complete disabled and only the BIOS compatibility mode is used. Source: http://osxbook.com/book/bonus/chapter10/tpm/
Apple would be violating anti-trust laws by not selling their operating system & upgrades separately, period.
I have two comments here. First, to be violating antitrust laws Apple would have to have a monopoly in one of the relevant markets. I suspect you know very little about antitrust laws, but on the off chance you are not clueless, what market do you think it is that Apple has monopolized? Second, writing the word "period" followed by the punctuation mark "." is redundant. I understand in speaking using this technique but it does not apply in written communication. Please stop it.
Psystar's case was legally winnable, but they didn't have the backers for winning in court.
Do you know what Pystar's case was about? Even if it was winnable, my post explains why it doesn't matter.
It might fair better for European clone makers since anti-trust laws will be enforced more correctly against non-European companies, i.e. Apple.
The EU antitrust laws are about the same as ours and I still don't see the monopoly you are predicating such action upon. Further, you specify non-European companies as though that makes a difference, which anyone with a clue knows is irrelevant. Please do a little research and see the hundreds of European companies the commission has taken action against before making such slanderously uninformed claims.