10 Things Psystar Legal Battle Teaches Us About Apple

By Don Reisinger  |  Posted 2009-12-03 Print this article Print

News Analysis: Although there is more litigation in its future, it seems all too obvious now that Apple has overwhelmingly won its legal battle with Psystar. But there are several interesting things to be gleaned from that court case that tells us quite a bit about Apple and its strategies. It's quite clear Apple will never deviate from its policy of not licensing the Mac OS to other PC makers. Furthermore it would be foolhardy for any new company to emulate Psystar's business model of trying to sell Mac OS machines behind Apple's back.

The legal battle over whether Psystar can sell Mac OS X-based computers is quickly coming to a close. In a not-so-surprising development on Wednesday, Psystar stopped offering its computers on its Website. The decision to take the computers down was the result of a crippling loss in a recent court battle with Apple. Psystar also agreed to pay Apple a whopping $2.7 million for damages and legal fees related to the sale of those computers.

Psystar started out as a small firm that had an idea to sell Mac OS X computers under Apple's nose. It didn't take long for Apple to find out and engage in what has been a long and trying court battle between the two companies. Most observers never thought it would have lasted this long. They believed that with a stable of high-powered lawyers at its command, Apple would quickly run roughshod over Psystar in the court proceedings. It didn't happen-the battle lasted more than a year.

But over the course of Apple's battle with Psystar, the small vendor taught us quite a bit about Steve Jobs and Company. Let's take a look at exactly what can be learned from the case of Apple vs. Psystar.

1. Apple will protect its property until the bitter end

If nothing else, we've seen a reaffirmation of Apple's long-held stance that the computer company will tenaciously protect its intellectual property from infringement by anyone. Often times, small companies mimic larger firms' products and in many cases, it's not worth it for the big firm to attack the small company, unless it directly steals intellectual property, trademarks or any other intangible property. But in Psystar's case, it was a different story. Apple realized that Psystar's operation was a direct threat to its bottom line and it did what it had to do to stop it.

2. Apple doesn't want to license Mac OS X

It's abundantly clear now that Apple has no desire to license Mac OS X. If it did, the company would have stopped fighting with Psystar and instead worked out deals with major PC vendors, like Dell and HP to license its software. In one fell swoop, Apple could have killed off Psystar (after all, its only advantage was Mac OS X), while substantially increasing its software revenue. Instead, Apple decided to sue Psystar. That move underscores its desire to keep Mac OS X close to the vest.

3. The company is scared of small vendors

Apple's decision to sue Psystar also highlights its fear of small vendors. If Apple failed to do anything with Psystar or it simply licensed Mac OS X, there would have undoubtedly been a slew of new companies arriving on the tech scene to sell Mac OS X-based computers. That would have saturated the market, likely limiting Mac sales. That was something that Apple wanted no part of. Small vendors are great for some things, but as far as Apple is concerned, it doesn't want to have to deal with them on the software front.

4. Mac OS X is a key to Apple's success

By suing Psystar, Apple has proven that Mac OS X is a major reason why its computers have been such a success. If Mac OS X was just a piece of software that no one cared about, Apple would have likely licensed the operating system a long time ago. But consumers buy Macs for more than just their good looks. They buy Macs because the experience Mac OS X provides is, in their estimation, superior to Windows' experience. Apple knows that. And it know that if Psystar was allowed to run amok, trouble would have ensued.

Don Reisinger is a freelance technology columnist. He started writing about technology for Ziff-Davis' Gearlog.com. Since then, he has written extremely popular columns for CNET.com, Computerworld, InformationWeek, and others. He has appeared numerous times on national television to share his expertise with viewers. You can follow his every move at http://twitter.com/donreisinger.

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