In the mid-1990s, Apple made the controversial decision to license its Mac operating system to third-party manufacturers, ushering in the short-lived era of Mac clones. Among these clone makers, Power Computing emerged as a shooting star - burning bright but fading quickly. Let’s explore Power Computing’s meteoric rise and sudden downfall, which mirrors the turbulent history of Mac clones.
The Birth of Mac Clones
Apple’s decision to allow clones in 1994 came during a period of struggle for the company. Facing stiff competition from Windows PCs and internal turmoil, Apple hoped that licensing its OS would expand the Mac ecosystem and market share.
Power Computing, founded by industry veteran Stephen Kahng, seized this opportunity. The company’s strategy was simple yet effective:
- Offer powerful Mac-compatible computers at competitive prices
- Sell directly to consumers via mail order (inspired by Dell’s success)
- Aggressively market to tech enthusiasts and professionals
Power Computing’s Rapid Ascent
Power Computing wasted no time in making its mark:
1995: A Strong Start
- May: Launches its first systems - the Power 80, 100, and 120
- Becomes the fastest-growing PC company of the 1990s
1996-1997: Peak Performance
- Releases the highly regarded PowerTower and PowerTower Pro models
- Gains reputation for offering faster Macs than Apple itself
- Revenue approaches $400 million annually
- Expands to 450 employees
- Plans for a new $28 million headquarters
By mid-1997, Power Computing was riding high. The company had secured rights to the upcoming Mac OS 8 and was preparing for an initial public offering (IPO).
The Sudden Fall
Power Computing’s fortunes changed dramatically in the latter half of 1997:
July 1997: Leadership Shakeup at Apple
- Steve Jobs returns as interim CEO, replacing Gil Amelio
- Jobs opposes the clone licensing strategy
August 1997: Clone Crackdown Begins
- Apple engages in tense negotiations with clone makers
- Refuses to license Mac OS 8 to most clone manufacturers
September 1997: The End of Power Computing
- Apple acquires Power Computing’s Mac OS license and customer database for $100 million in Apple stock
- Power Computing announces it will exit the Mac clone business
Early 1998: Final Shutdown
- After a failed attempt to enter the Windows PC market, Power Computing ceases operations
Why Did Apple End the Clone Experiment?
Several factors contributed to Apple’s decision to terminate its clone licensing program:
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Cannibalization: Clones were eating into Apple’s high-end Mac sales, where the company made its largest profits.
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Brand dilution: Apple feared losing control over the Mac user experience and its premium brand image.
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Strategic shift: Steve Jobs aimed to simplify Apple’s product line and regain tight control over the Mac ecosystem.
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Financial considerations: Apple believed that ending clone licenses would ultimately be more profitable than continuing the program.
Legacy of the Mac Clone Era
While short-lived, the Mac clone experiment left a lasting impact:
- Demonstrated consumer demand for lower-priced Mac hardware
- Pushed Apple to improve its own designs and pricing
- Influenced Apple’s later transition to Intel processors, which made “Hackintoshes” (unofficial Mac clones) possible
The story of Power Computing serves as a cautionary tale about the risks of building a business dependent on another company’s core technology. It also highlights Apple’s long-standing philosophy of maintaining tight integration between its hardware and software.
The Mac clone era remains a fascinating chapter in Apple’s history. While it ultimately proved unsustainable, it forced Apple to innovate and adapt - lessons that would serve the company well in its remarkable resurgence in the decades to come.