The Psystar Myth – Not as cheap as advertised

Sun, Oct 19, 2008

Analysis, Featured, Finance, Legal, News

Earlier today, I came across an ad for Psystar which was advertising a 2GHZ computer running OS X with 2GB of Ram for only $554.  Psystar likes to market itself as a cheaper alternative to Apple, but a closer look reveals that a Pystar computer running OS X isn’t as cheap as Psystar would lead you to believe, and that the $554 price tag is completely misleading.

Psystar likes to advertise a picture of a desktop tower, accompanied by a monitor showing Leopard, alongside a price tag that says “From $554”.  In reality, to get the setup pictured in the ad costs almost 500 dollars more and is about the same price as a comparable iMac.

For starters, the $544 price tag doesn’t include a monitor, and if you’d like one, Psystar will add one on for 200 dollars more.  It also doesn’t come with a mouse and keyboard, but Pystar will add one in for 29 bucks.  Their computers also don’t come with FireWire, but you can get a FireWire port for only 40 extra bucks.  You want a wireless card?  Add in another $100.  Are you a bluetooth man?  If so, chalk up another 40 bucks.  That brings the grand total to $961 for a complete desktop system.  And at this point, it still isn’t up to speed with what the iMac offers.  The entry level iMac offers a 2.4 GHZ processor, and if you want to upgrade the 2.0 GHZ processor that comes with your Psystar computer, you’ll have to add in another 60 bucks.  This leaves us with a desktop configuration that comes in at $1,021.99.  You can get an equivalent iMac from Apple for as low as $1098 after rebates.  All in all, Psystar saves you around 75-100 bucks, but carries a disproportionate amount of risk as future software upgrades from Apple might cripple your Psystar hardware.  Dropping more than a grand for a computer that might stop working if you want to keep it up to date doesn’t seem wise.  To combat this, Psystar has turned off the automatic software updates, so you’re essentially stuck with the version of Leopard that shipped with your computer.  Moreover, Psystar’s setup involves a tower and a monitor, whereas the iMac has the monitor and CPU all in one case.  And one more thing, Psystar’s version of OS X doesn’t come with iMovie or iPhoto since iLife isn’t included in the retail version of Leopard.  iLife retails for around $79 bucks, so all in all, an iMac and equivalent Psystar system are essentially the same.

Psystar might claim that it’s giving consumers more bang for their buck, what they’re really offering is a Mac mini clone for $544.  Only thing is, their version of the Mac mini isn’t so mini.  It’s a tower.

The Legal Battle

Apple and Psystar have sued and counter-sued each other, but both recently agreed to enter into Alternative Dispute Resolution (ADR), meaning that they will both try and avoid litigation and settle their claims via meditation or arbitration.  This is a move that caught many off guard as the crux of Psystar’s allegation is that Apple has a monopoly in the OS X market, an argument that doesn’t have any legal legs to stand on.  Clearly Psystar couldn’t argue that Apple has a monopoly in the PC market as they have less than a 10% market share.  So instead, Psystar came up with the somewhat specious argument that Apple has a monopoly in the OS X market since it won’t allow its operating system to run on any non-Apple hardware.  It’s curious, though, how Apple can have a monopoly in a market that Psystar essentially made up out of thin air.  Think about it – there is no OS X market.  Apple puts OSX on computers that it sells in the computer market.  I mean, you can’t sue Coke for refusing to put its formula into a different can on the notion Coke has a monopoly over the coke formula.  Admittedly, its an original idea, but legally it should fall flat on its face.

But for some reason, Apple has chosen not to litigate.  Perhaps it didn’t want to spend the resources necessary to fight the lawsuit, or perhaps the risk, however small, that they would lose wasn’t a risk Apple was willing to take.  If Apple lost, it would give every other company a green light to put a hacked version of OS X in whatever box they wanted, sell it for a little bit less, and take business away from Apple, much in the way that the clones did way back when Apple did, in fact, license its OS.

Psystar’s questionable history

But did Apple have anything to fear at all?  Psystar has been shrouded in shadyness since its inception, with the Miami Chamber of Commerce and Better Business Bureau both showing no record of its existence.  The president of Psystar, Rudy Pedraza, also seems to be a shady fellow, and Psystar has previously run into trouble for taking Credit Card numbers but not actually processing them.  But that’s not all.  The physical location of Psystar’s supposed offices have changed at least three times (all within a matter of days), with one of the locations having no trace of Psystar ever being there or leasing any space.  Psystar was founded by Roberto and Rodolfo Pedraza, two brothers from South Florida in their mid-20’s, and the two have been involved in a host of other corporations, many of which have since been dissolved by the state due to the lack of properly filed paperwork.

Apple’s original motion to dismiss Psystar’s claims can be found here.

Engadget reviewed a Psystar machine back in April, which can be read here.  Gizmodo’s review can be found here.


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28 Comments For This Post

  1. Justin Miller Says:

    Yes but you can buy just the tower, and if you already have a windows pc, hook that tower into your other set of equipment.

    Or you could buy just the tower.
    Buy a 19″ Monitor online for $115
    Buy a mouse and keyboard for $5
    Buy a wireless adapter for $8

    And still be able to just run OSX much cheaper than buying an apple product.

    I am not saying that the apple product isn’t better, but neither are you.

  2. brian Says:

    You’ve missed the point. Where are all those options on Apple’s site? What if you DON’T need any of the stuff you just mentioned? Then you CAN actually get it much cheaper. With Apple, I have no choice but to get all of that equipment. With Psystar, I HAVE the choice.

    Your point should really be: “If you want a FULLY LOADED system, then thr Mac is comparable. If you DON’T, Psystar is cheaper.

  3. WolfWitch Says:

    Um, okay- how is that any different than Dell? They advertiser computers dirt cheap without monitors, keyboards, mice, wireless, etc, all the time. It’s typical in the computer industry- the price they show is for the basic box, you have to pay for everything else.

    Is it deceptive, especially if you compare it to how Apple sells their products- probably.

    I do agree with one point- their ongoing operation is a gray area that I wouldn’t throw $1000 into, and if I want a Mac- I’ll buy one from Apple.

  4. Ed Says:

    Justin, maybe you don’t read good. This is essentially a mac mini with a tower form factor. You could get the same hardware setup in a mac mini for around $75-100 more, and you get actual software updates, iLife, and a couple more good things.

  5. Eric Says:

    Is this really any different from any other computer maker? If you look at ads from other computer makers, they often do the same thing. And it’s not only limited to computer makers – other companies do it too. It’s a marketing strategy.

    Apple does the same thing. You could buy a Mac Mini for as little as $599, but it also does not include a mouse, keyboard, or monitor. However, the advantage of the Psystar computer is that since it’s a tower, it’s easily upgradable. For about the price of a Mac Mini, you get an OSX-capable computer that allows you to upgrade the video card if you want (with a Mac Mini, you’re stuck with its onboard video, which is not great for 3D-intensive applications). And I believe the Psystar PC already comes with a decent video card. With Psystar’s PC, it would also be easier to upgrade the RAM, hard drive, optical drive, etc..

  6. joel murphy Says:

    you could do those things, but unless you do your research, you could be buying cheap hardware that doesn’t have osx support. because makes the hardware that the os is going to live on, they only write drivers for the different components they use, not the thousands of other pieces of hardware they don’t use. this increases stability & makes quality control simpler.

    there are some other devices which users have been able to get working, but you have to do the research to make sure you don’t end up in kernel panic hell (like i have been many times)…

    i’d bet that psystar is installing natively functional hardware, not hardware that had to be coerced into working… not the the average user that wants a mac, but cheap. if you want a cheaper mac, bet a refurb.

  7. Matthew Says:

    Psystar is for people who are too lazy to do a little research and build a system themselves. These users are also the same ones who whine when they apply the latest patches and the system breaks. Gee, who’da thunk it.

    If you can’t afford a real Mac and think Psystar is the answer… do us all a favor and stick to Windows.

  8. Peter Giessel Says:

    You also aren’t counting that Psystars don’t come with iLife. That’s another $79 to have the Psystar similarly equipped to an out-of-the-box iMac.

  9. Tom Says:

    99% of people will already have a monitor, mouse and keyboard so you can take those off the list. Now you end up saving over $200 and I don’t know about you but I can sure use an extra $200 in my pocket these days.

  10. Ludwigk Says:

    That’s hardly “much cheaper” than buying an Apple product. It’s $50 shy of a Mini, and there are tradeoffs both ways. You get iLife, firewire, wireless, BT, smaller form factor, so I think its a very fair tradeoff.

  11. DV Says:

    Of course, if you already have a monitor, KB and mouse, it’s a much better deal than the mini:

    Mini ($600) / Psystar ($594 w/FireWire)

    1.83GHz Core 2 / 2.2GHz Core 2 (free upgrade)
    1 GB RAM (667) / 2 GB RAM (800)
    1 FW port / 3 FW ports
    Intel 64MB shared video / nVidia 256MB ded. video
    4 USB ports (back) / 6 USB ports (2 front, 4 back)
    80 GB 5400rpm HD / 250GB 7200rpm HD
    No PCI slots / 2 PCI-Express, 1 PCI (2 if no FireWire)
    BlueTooth / none
    802.11g / none
    iLife / none

    If you really need BT, USB adapters are $20, and iLife is a mere $80…

    Personally, the iMac would work fine for me (I own a mini G4 now), but I’ve always hoped that Apple would make a cheaper “Mac Pro”-like mini-tower in the $1000 range…

  12. Evan Hammond Says:

    This article is a poor argument against Psystar. They aren’t offering you a ‘Mac’ computer, they are offering you a rig that will run MacOSX. Sure, if you want an exact Mac computer, then get one, there is really no substitute.

    But for people who want Final Cut, without having to pay the 2500 for a decent Mac, can get this one for ~$600. I’m guessing that most of the community who buys these Psystar machines know a little bit about computers, so in they end, they can go to Newegg and for 200 extra bucks they can get 2 more gb of RAM, and a better processor.

    All of this is still under $900 which will end up being better than the Mac in the closest price range.

  13. Tom Says:

    CPU means Central Processing Unit IT DOES NOT MEAN A COMPUTER TOWER!!!

  14. Sean Says:

    You can make PC users have an orgasm over the word “upgrade.” So insecure, they’re so scared that their computers gonna be out of date any minute that the only thing they wanna do is keep buying new parts for them. Here’s a money saver, rather than buying a half-ass shit computer and upgrading it piece by piece (those parts cost a lot of money by the way), why don’t you just buy a great computer that WORKS FOR YOU. Something that can handle anything you’re gonna throw at it easily? In other words, SPEND THE MONEY NOW, SAVE THE MONEY LATER. If a computer does everything that you want it to do, then guess what, IT DOESN’T NEED TO BE UPGRADED!!

    To the gamers out there… I’m sorry, but you’re fools to the system. The PC game makers make use of the latest hardware requirements in order to make YOU, the gamer upgrade your system about every year or so. Yeah the games look better with better hardware, but stick to a console, so that the game makers work with YOU and YOUR system. Realistically, what are you searching for? A realistic experience while playing a video game? Doubt it, generally the point to is to be removed as far as possible from reality. What you’re looking for is a fun, addicting, and interesting game. Well you don’t need ‘state-of-the-art’ graphics, a 4 GHz Quad-Core processor and 4 GB of system RAM to do it. Only a fool would drop moolah on their computer for a game with ridiculous system requirements. I had a gamer friend acutally tally up the money he’s spent on upgrades to his PC for the last 4 years (not the original computer itself, just the upgrades) it came up to about $8,000. That’s what I call ‘stupid.’

  15. Simon Says:

    i love it when companies settle disputes by “meditation”… it seems just like the sort of tactic that Steve Jobs would insists on with his turtle necks n all.

  16. George Says:

    @Sean…Wow. No, I like PC’s to be upgradable because I don’t buy new computers every year. I want to be able to add drive space, memory and video as I need them, not when someone says I need to-like Apple. I play games, but I’m not a ‘gamer’. I don’t orgasm over the word, either. I don’t buy ‘half ass shit computers’ either. But I do want them upgradable. Just how upgradable are those all-in-one iMac things, anyway? Memory and drive space, I suspect, but not much else. What happens if the screen goes bad? New computer?
    I do agree with you on one point: eight grand for upgrades IS stupid. Just don’t lump us all in that category.

    This story seems a bit defensive. Why do people feel the need to defend Apple’s artificially high price by trying to make others look bad? If Apple can command such a premium for it’s machines, more power to them. No one needs to defend them. And for those PC people who like to say they are overpriced, well, don’t buy them. They are overpriced and not that great a value, that’s why I don’t one. And, please, don’t tell me about iLife, iWork or whatever and don’t tell me how reliable they are. I’ve heard it before. That does not make them a good value. If they work for you, great.

  17. Marty Says:

    You are a moronic fanboy, that is all this proves. People should be able to do what they want with the software they buy, including put it on computers that aren’t made by the same manufacturer. If Apple ran the PC market, we would all be subject to the worst monopoly in technology. Even Microsoft isn’t as evil as Apple. You’re just upset that a company has cheapened your smug fashion statement. And you know what? Good.

    In addition, why would I buy a desktop system with the monitor integrated? If I wanted that, I would just buy a laptop.

  18. Darthweder Says:

    I don’t think you understand….. Most intense PC gamers buy these really good (and expensive) systems so they can play the really good and expansive games. Yes, expansive. Do you wonder why Crysis isn’t out on the 360 or ps3? It’s because the graphics cards and cpu are outdated.

    Maybe you like to be cornered into only playing console games, but I’ll stick to my $800 pc that can play Oblivion, Crysis and all the other new games, and the great mods that come out on the PC.

  19. Ari Says:

    It’s not about a cheaper OSX, its about a computer from an untrustworthy company!

  20. alansky Says:

    The Psystar certainly appears to be aimed at mentally-challenged Mac wannabe’s who lack the good sense to recognize the very unfavorable risk/benefit ratio of this product. One might be tempted to say that they get exactly what they deserve if they buy Psystar’s fatally-flawed computer. You makes your choice, and you takes your chances.

  21. Somebody Says:

    Obviously the fu**er who wrote this article does not understand what the word NEED means.
    I don’t fu**ing need a firewire and bluetooth or wireless. Why should I pay for something that I don’t use? When you answer that question, then you will understand Psystar philosophy.

    Oh yes, and stop calling PC a PC and Mac a Mac since Mac moved to Intel platform, Mac became PC too.

  22. Brian Says:

    Your Coke analogy doesn’t really work here. If you were able to buy Coke in liquid form and then separately, buy the can… then it would make sense, as does the legal challenge in court, hence the out of court settlements going on.

    For the record, I am a PC user at work where I do design work and a Mac user at home where I do recording (and more design work). The machine I built at work for $2000 would have been close to $5000 (or more) as a Mac Pro… which is why I’ve got a PC there.

    I am eager to see what the outcome of this settlement will be. I think it is smart of Apple to settle this out of court and not leave anything up to chance regarding their EULA. If there were case law striking it down, it would open the way for other companies (like HP and Dell) to start doing the same thing.

  23. Serenity Now Says:

    Why is there so much aggression in the comments? Heal people…

  24. Anonymous Says:

    @George s/artificially high price/high end quality/

  25. Anonymous Says:

    Go Psystar I am mac user for more than 12 years , And Psystar is a great alternative mate. Psystar will survive and will give hell to Apple it is about time for steve and Apple to get a reality check they r not the king ! that is and always be Elvis 😉

  26. flyturkish Says:

    Go Psystar I am mac user for more than 12 years , And Psystar is a great alternative mate. Psystar will survive and will give hell to Apple it is about time for steve and Apple to get a reality check they r not the king ! that is and always be Elvis 😉

  27. Buy Psystar Says:

    Seriously, are you comparing a Power Mac to an iMac? The Psystar systems are equivalent to Power Macs after all.

    Also, anyone who has been into an Apple store will testify that Apple also places large, smooth looking displays next to their Power Macs that are not included in the sticker price of the computer its self.

    This is the oldest trick in the PC marketers book, and most consumers are savvy enough to know the difference.

    Besides, if I save $3,000 by buying a Psystar instead of a Power Mac what is a few hundred bucks for a monitor?

  28. Enfoceenidods Says:

    Hola a todos, en mi primer post me gustaría compartir algo con vosotros, Ya sabéis que para buscar y descargar música en internet, tenemos muy pocas opciones, generalmente utilizamos el emule o el ares, pero yo personalmente encuentro bastante frustrante bajarme una canción y que no sea la que busco, porque pierdo bastante tiempo encontrando material de calidad.

    Una amiga me recomendó utilizar Altavz como mi buscador de música, y la verdad es una gozada.

    Además de poder escuchar la canción, descargarla o agregarla a tus listas preferidas puedes encontrar a otros usuarios y compartir tu música con ellos.

    Hace mucho que no utilizo emule, sino este buscador de música.

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