Macintosh software licensed to IBM Apple will receive royalty on each deal

THE BALTIMORE SUN

CUPERTINO, Calif. -- Apple Computer Inc. yesterday licensed its Macintosh software to International Business Machines Corp., in an effort to spread its gospel to a wider audience.

Apple kept its operating system to itself until 1994, when it began awarding licenses to a few clone makers. Most other personal computer makers' machines use software from Microsoft Corp. and chips from Intel Corp.

The agreement doesn't go as far as some people would have liked. IBM itself won't make any Mac clones. Instead, it will sublicense the system to other, small computer makers.

"It's not IBM making a PC with the Mac OS," said analyst Barry Bosak of Smith Barney. "It's not the plus it could be."

Apple will receive a royalty on each license awarded through IBM, as if Apple itself were licensing the system each time.

For clone makers, the agreement means they can go to IBM for hardware, support and software, instead of dealing with separate suppliers.

"It's one-stop shopping," said Michael Attardo, general manager of IBM Microelectronics, noting that he expects to be able to speed the growth of the PowerPC and Mac market. IBM and Motorola Inc. helped develop the PowerPC chip that is used in Macintoshes and is the equivalent of Intel's high-powered Pentium chip.

"We believe the PowerPC microprocessor and the Mac OS is a combination with significant potential for growth worldwide, particularly in Asia and Japan," Attardo said.

Attardo said he expects to see laptop computers, subnotebooks and entry-level desktop machines as the first products of this agreement in Asia.

Apple has been pummeled by problems in the past year, including executive turmoil, declining demand, and a $740 million loss in the fiscal second quarter, its largest ever. The computer maker is working to slim product lines, cut its work force and return to profitability in the next 12 months.

IBM, which makes its own PowerPC-based systems using software from Microsoft, still has no plans to make Macintosh computers.

"IBM is not committed to ship any Mac OS at this time," Attardo said. He added that does not preclude any IBM division from licensing the system, but there are no plans to do so now.

Pub Date: 5/07/96

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