Apple Software to Be Licensed to Some Rivals : Computers: Access to Macintosh line will be conditional on using new PowerPC microprocessor.
Apple Computer Inc., in an important philosophical shift, plans to stop hoarding its popular Macintosh software and license it to competing computer makers.
But there’s a catch: Apple, the computing pioneer based in Cupertino, Calif., said it will make the user-friendly software available only to makers of machines that use the coming PowerPC microprocessor, jointly developed by Apple, IBM Corp. and Motorola Inc.
It will not offer the software to makers of personal computers that use Intel chips, which dominate the market, particularly in offices.
Chief Executive Michael Spindler told shareholders at Apple’s annual meeting Wednesday that the company is “actively exploring” licensing options.
Spindler had hinted at such a Macintosh strategy in recent months, and Apple took a step away from its isolation philosophy last year, when it licensed the technology for its new Newton hand-held computing and communications device.
One analyst said it is significant that Apple has publicly committed itself to a strategy for challenging Intel’s dominance of the market and boosting its own flagging fortunes.
“If Apple doesn’t get its software licensed, it will be doomed to single-digit market share for the foreseeable future,” said Rich Bader, an industry analyst in Beaverton, Ore.
Machines that use Intel chips as their “brains” and Microsoft Corp.’s Windows operating software hold overwhelming leads in the corporate and home-use markets. Dataquest Inc., a San Jose research firm, projects that U.S. sales of machines based on Intel’s Pentium family of chips and its clones will soar to 21 million by 1997, three times more than projections for PowerPC machines.
Intel’s dominance is encountering fierce challenges, however. In a blow to the giant Wednesday, Compaq Computer Corp. pledged to buy some microprocessors from Advanced Micro Devices Inc., a key Intel rival.
Of machines already in use, 39 million use Intel chips and 6.8 million are Macintoshes containing Motorola chips. Apple has billed the PowerPC as offering “twice the performance of Pentium for half the price,” but Intel has recently taken aggressive steps to reduce its prices.
Opinion is divided as to how much licensing would help Apple, which has been troubled by management turnover, blistering price competition and a sour reception for the Newton. Apple’s stock has tumbled from a high of $62 a share last January. In trading on the Nasdaq Stock Market, Apple shares rose 62.5 cents Thursday, to close at $34.125 a share.
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Apple is expected to release its first Macintosh machines based on the PowerPC in March. Other manufacturers are likely to sit back for a time until they see how the PowerPC fares against Intel’s new Pentium chip.
Bruce Lupatkin, an analyst with the Hambrecht & Quist investment firm in San Francisco, said there is no guarantee that other computer companies will want the Macintosh operating software. And he questioned Apple’s motives.
“The issue is whether there are new opportunities in emerging markets,” he said. “If Apple is trying to position itself against Windows in the corporate world, it doesn’t make sense.”
