Psystar’s impossible dream

Matthew JC. Powell
3 September, 2008
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The long-anticipated lawsuit brought by Apple to stop Psystar selling unlicensed Mac clones has begun in earnest, and the gloves are off. All along, Psystar has implied it had an ace up its sleeve that it wouldn’t reveal until the time was right, and last week, the time came: Psystar counter-sued Apple for abuse of its monopoly power. Hang on … what?

Psystar’s lengthy countersuit accuses Apple of creating a monopoly in the “Mac OS market” and abusing its monopoly power by choosing not to license its operating system to other hardware vendors.

The fact that Apple’s operating system commands something of the order of eight percent of the market apparently is not enough to dissuade Psystar from its monopoly accusations. The Mac OS market, it argues, is sufficiently distinct and unique that Windows cannot be considered a reasonable substitute, therefore Apple is a monopolist.

And I seem to recall Apple having sued Microsoft some years back because Windows wasn’t sufficiently distinct and unique. Odd that.

The thing that amazes me is that Psystar has spent its time and money preparing such a hare-brained attack. To argue that Apple is a monopolist because it has created a unique product and wishes to control how that product is sold is essentially thumbing your nose at the entire notion of copyright. Psystar is essentially saying that because there is not another magazine exactly like Australian Macworld, its publisher is a monopolist and we should let anyone photocopy it and distribute it however they like. Sure, there are other Mac magazines, even some called “Macworld”. And there are other Australian magazines too. But there’s only one “Australian Macworld” — therefore we’re a monopoly.

It’s bizarre.

Psystar should really have had its lawyers drafting realistic arguments against the terms of the End-User-License Agreement it is accused of having violated. Defending a real charge is a much better use of the resources available than tilting at windmills.

Without going too deeply into the amazing absurdity of Psystar’s argument, let’s look for a moment at what it thinks it will achieve. I suspect (I don’t know this as I am not psychic) that Psystar thinks it will successfully argue that Apple has abused its monopoly power in the “Mac OS market” and the courts will force Apple to let it go on doing as it has been doing — buying copies of Mac OS X at retail and then reselling them.

The court won’t do that. The best Psystar can hope for is that the courts will force Apple to negotiate licensing terms for Mac OS X. Apple would simply set the licensing terms at a level Psystar couldn’t reach, and it would be game over.

Or, let’s delve a little deeper into the realms of fantasy, and imagine that Apple decided to license Mac OS X at terms Psystar could afford. Does Psystar think it would then be just it and Apple selling Macs?

No. It would be Dell. It would be HP. Probably Lenovo and quite likely Asus. Not to mention hundreds if not thousands of other white-box vendors just like Psystar, all of them keen to get a piece of that Apple pie.

And just let me mention at this point that I don’t for one moment think that would be a bad thing. I think the time is ripe for Apple to consider expanding its reach by partnering with someone like HP or Dell with strength in the enterprise market, and maybe it is worth looking at what could be done with a tightly-controlled licensing program for low-cost desktops.

It might be a good idea, but it would have to be done on Apple’s terms, in a way that makes sense for Apple’s business. Otherwise we could see a repeat of the mid-1990s experiment that very nearly wiped the Mac out completely.

To date, Psystar’s uniqueness — its competitive advantage — has been that it was the only company (or at least one of very few) willing to break Apple’s license terms and sell Mac OS X unauthorised on its own “clone” systems. In the very unlikely event that it should prevail in its argument that Apple is an abusive monopolist, its own uniqueness would be washed away in the resulting flood of clone vendors.

Psystar can’t win this fight. It should not have started it.

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