Apple And Their Software

I was reading an intriguing article on eWeek that outlined some possible scenarios where Apple would licence Mac OS on other platforms. It is a timely question in light of the Apple v. Psystar ruling (here on Groklaw). There is one issue I have with the article, which is in the introduction, says Apple  “… might soon have the right to stop any and all companies that want to install its operating system in their own computers”. My issue is that the authors assume that a court of law was required to uphold Apple’s right to control how their copywritten work is used. All the court did was reaffirm a right Apple (and any other holder of a copyright) has in terms of how their works are used.

Apple has always had the right to control who runs their software, and what hardware they run it on. All software vendors do, with the exception of those ordered by a court to change those restrictions. When would that happen? In the case of an antitrust violation, and an order from the court is issued in order to limit the abuse of a monopoly. IBM consented to allow their mainframe operating systems to be installed on non-IBM hardware during the antitrust action they faced during the 1970’s. The courts in the US and the European Commission have both said that Microsoft cannot tie their browser into Windows and exclude other browsers. But these are exceptions for exceptional circumstances. Until these exceptions were made, nothing that IBM or Microsoft was doing was illegal in an of itself. In the case of IBM, where the problem occurred was IBM allegedly abusing its monopoly on the mainframe market to exclude competition. Note I said “allegedly”: the antitrust action was ended when IBM consented to conform to certain actions and behaviours, without admitting it broke any antitrust laws. Microsoft was found to be in breach of antitrust law in a US court, and agreed to make changes in how Windows was packaged and released to avoid a more drastic AT&T-like breakup.

Now, while it may be perfectly legal for Apple to restrict how their software is installed and used, that doesn’t mean it necessarily makes business sense to do so. The rest of the article goes on to explore some interesting scenarios, many of which are quite plausible in my mind, where Apple would look at allowing Mac OS on other machines. While their current model certainly has some benefits, I believe it is ultimately holding them back from capturing a larger portion of the PC market.

Controlling the hardware has some advantages for Apple. It keeps testing simpler, because they don’t have to deal with the plethora of 3rd party hardware (CPU’s, motherboards, video cards, storage, network, etc) that Microsoft does. As a result, it means they can spend more time making sure Mac OS works well with the hardware. It also allows Apple to control the entire experience for the user, not just in the software. Apple controls how that software works with the keyboard, pointing device, display, etc, and how the machine looks from the outside. Its a unified approach for both the hardware and the software.

If Apple were to licence Mac OS to other vendors, I would expect that the licence would include a lot of control for Apple in the look, feel and build quality for those systems. I don’t believe that Apple will let another company put out a machine that doesn’t look good, and “feel good” to the purchaser. That will limit the number of players that Apple will be able to deal with, but it could allow Apple to broaden their customer base and still have some control over the brand and image for the system.

The advantage for Apple is that it would allow Mac OS to be put on devices Apple wouldn’t necessarily want to build. One example is netbooks: buyers for those are very price sensitive, and Apple appears loathe to build a super-cheap machine and give up their historical profit margins. Apple, with the right licence, would still control the hardware design and appearance. It would allow Apple to capture some netbook customers, but without having to incur the expense (in dollars and brand image) they would have to take on by doing it themselves.

Apple CEO Steve Jobs has said that he does not want to see Mac OS on anything by Apple hardware. While Steve is passionate in his statements, he also said Apple wouldn’t get into home theatre systems (and subsequently did with the AppleTV). He also said Apple had no interest in smartphones (and shortly thereafter released the iPhone). I expect that, right now, Apple truly doesn’t want Mac OS on other machines. The profit margins are too good, and having the control has benefits. But, if things change (as outlined in the article), I would expect to see Apple do some kind of deal to put Mac OS on other machines.

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