Minority Report: Mac clones doomed?

The Apple vs Mac clones battle rages on - but will it change Apple's mind about licensing Mac OS X? Not a chance, says Seb Janacek.

Apple has won a key victory in its ongoing legal battle with 'clone' Mac maker Psystar.

Psystar started selling Intel-powered PCs pre-installed with Mac OS X Leopard in April this year. The company sells its computers from a starting price of $555, undercutting even the Mac Mini - Apple's cheapest desktop running OS X.

Apple was not impressed.

In July, Apple sued Psystar, claiming it had broken multiple copyright and software-licensing laws. The company's Mac OS X end-user licensing agreement forbids users from installing the operating system on non-Apple hardware.

In August, Psystar counter-sued Apple, claiming the Cupertino firm operates a monopoly and complaining about restraint of trade and other antitrust issues. Last month, both companies agreed to a mediated route for resolving the debate.

Then last week a judge threw out all six claims made by Psystar and labelled them "internally contradictory".

Arguments of whether Apple should license its operating system are almost as old as the company itself. Bill Gates famously advised the company to do so. He was famously ignored and went on to dominate the market himself with Windows.

Even now, some commentators call on the company to license the OS in order to build market share. Such arguments seem to be based around the argument that in order for Apple to be truly successful it needs to be matching its Seattle competitor in market share. Not so.

Apple isn't pitching itself against Windows - that's just an easy and recognisable target for its marketing. It's more accurate to say it's competing against PC makers - Dell, HP, Lenovo and the others. Even its 'Get a Mac' marketing is misunderstood in this respect.

The ill-fated clones programme of the 1990s was Apple's strategy to increase its market share, effectively closing the stable door once the horse had made it all the way to Redmond. It was a programme born out of "institutional guilt", according to Jobs.

The plan almost led to the demise of Apple. On his return to Apple, Jobs shut the scheme down almost as soon as his name had been stencilled on the door of the Apple CEO office.

Will Apple license the OS X? Not a chance. It makes its margins on hardware, not software. Licensing the OS would dilute sales of high-end Macs and the company is selling more of those than ever before. If the hardware is 'what' the company makes its money from, the operating system and the software is the 'why'.

In a recent call to analysts, Jobs outlined the company's strategy: "We've seen great success by focusing on certain segments of the market and not trying to be everything to everybody so I think you can expect us to stick with that winning strategy. And continue to try and add more and more value to those products in those customer bases we choose to serve."

So it's mass appeal with an all-in-one solution, but mass appeal limited to the more profitable segments that Apple chooses to serve not customers whose purchasing is entirely motivated by price.

It also sends out a clear and unambiguous warning for other potential Mac cloners: OS X is a Mac thing. Period.