Podcast Summary: Asianometry — The Mac Clone King's Brief Reign
Host: Jon Y
Episode Date: October 30, 2025
Episode Overview
This episode of Asianometry, hosted by Jon Y, dives deep into the short but dramatic history of Macintosh cloning in the 1990s, focusing on the story of Steve Kang (“King Kang”) and his company, Power Computing. The episode explores how Apple’s late decision to license the Macintosh OS led to an unlikely partnership that sparked explosive growth, deep corporate anxiety, and a dramatic takedown orchestrated by Steve Jobs upon his return to Apple. Through rich narrative and historic detail, it’s a fascinating window into Silicon Valley decision-making and business strategy.
Key Topics & Insights
1. Apple’s Late Licensing Gamble
- Apple’s Market Share Crisis (00:03–03:45)
- In 1994, Apple’s market share had shrunk to 7% as Windows dominated with 80%.
- Apple managers had debated OS licensing for years, fearing eroded margins.
- Notable Quote (Apple CEO John Sculley, paraphrased):
"We had run models and it always came out with the same result... there was no way we could make money with the license model... Bill Gates, in his brilliance of pricing, had purposefully kept the license fees for Windows at about $11 a copy." (04:40)
- Microsoft’s success was attributed to low license fees and Office sales.
2. Steve Kang’s Origins & PC Clone Experience
- Biographical Sketch (03:46–08:15)
- Steve Kang, born in Seoul just before the Korean War, educated in the US (Univ. of Michigan), worked at IBM on mainframes.
- Gained expertise making PC clones; key project: Daewoo and the Leading Edge Model D (one of the first Korean PC clones in the US market).
- Kang regretted taking only a $200,000 fee for the Model D; later earned up to $3 million/year as a consultant.
3. How Power Computing Landed the First Mac OS License
- Reluctant Partnerships & Prototype Hustle (08:16–15:30)
- Apple wanted a “big name” licensee but ended up with Kang and startup capital from Olivetti.
- Kang hired ex-Apple engineers for credibility and prototyping, showing initiative by bringing a working Mac clone to Comdex ’94.
- Apple grudgingly granted Power Computing the first license in late 1994 due to lack of other viable candidates.
4. The Mail Order Mac: Disrupting Apple’s Business Model
- Rapid Execution & Cost-Cutting (15:31–22:10)
- Power Computing modeled itself after Dell’s direct-sales strategy, offering Macs by mail order—cheaper and customizable.
- Their products were 20% less expensive and incorporated off-the-shelf PC components for further savings.
- Notable Quote (Steve Kang, 17:30):
"I have to be a billion dollar company shipping a million units a year. If you look at the PC business, none of the small guys survive. You grow or you're out of business. There's nothing in between."
- In four months, 15-person team launched first products; by end of 1995 sold 50,000 units.
5. Explosive Growth & Apple’s Anxiety
- Successes—and Tensions Rise (22:11–29:40)
- By mid-1996, over 100,000 units sold, net sales of $131M, $100M/quarter by end of the year.
- Apple increasingly worried about cannibalization, as Power targeted not just new users but traditional high-end Apple customers.
- Corporate contracts, e.g. Lockheed Martin buying 3,000 Power Macs, were lost to Power.
- Notable Quote (Power VP Jeff Burr, 24:15):
"There's no question Apple is losing sales to us, but we're also expanding the Mac market."
- Power advanced faster than Apple, offering newer processors and more RAM.
6. The Mac Clone Backlash: Renegotiation and Shutdown
- Apple Retaliates, Jobs Returns (29:41–37:30)
- Apple tried raising licensing fees as Mac clones cut into profits; needed fees “10 times higher to be profit neutral.”
- Steve Jobs’ 1997 return marked a stark pivot; he refused any licensing at any price.
- Notable Quote (Steve Jobs, paraphrased, 33:35):
Jobs bluntly told Power Computing that their license would be terminated.
- In September 1997, Apple bought out Power's Mac operations for $100 million in stock; settlement described as "diplomatic" by Olivetti’s Piol.
7. The Aftermath: Power's Collapse and Industry Impact
- The End of Mac Cloning (37:31–end)
- Power tried pivoting to Windows PCs but overextended inventory and failed.
- Company shut down in January 1998. The local Georgetown economy was hit hard after betting on Power's expansion.
- Other Mac cloning programs (IBM, Motorola) folded. Only Umax in Taiwan survived briefly under strict Apple conditions, exiting in 1998.
- Memorable Moment (Reflection, 41:10):
"In case you are wondering, $100 million of Apple stock in 1997 would be worth about $200 billion today."
- Steve Kang left for VC and philanthropy; his journey underscored a remarkable, risky era in personal computing.
Notable Quotes & Timestamps
-
On Apple’s Early Reluctance:
"We had run models and it always came out with the same result... Bill Gates, in his brilliance of pricing, had purposefully kept the license fees for Windows at about $11 a copy."
(Jon Y relaying Sculley’s oral history, 04:40) -
On the Harsh Clone Market:
"I have to be a billion dollar company shipping a million units a year... You grow or you're out of business. There's nothing in between."
(Steve Kang, 17:30) -
On Missing the Ideal Window:
"Yes, the ideal time had long since passed. But Apple needed the revenue. They had to lift its flagging market share."
(Jon Y, narrative, 11:20) -
On Expanding the Mac Market:
"There's no question Apple is losing sales to us, but we're also expanding the Mac market."
(Jeff Burr, Power VP, 24:15) -
On Jobs’ Ultimatum:
"Jobs bluntly told Power Computing that their license would be terminated."
(Jon Y, paraphrasing, 33:35) -
On Apple Stock’s Growth:
"In case you are wondering, $100 million of Apple stock in 1997 would be worth about $200 billion today."
(Jon Y, 41:10)
Key Takeaways
- Missed Timing: Apple’s decade-delayed entry into OS licensing left them with few and small partners, yet even modest success proved threatening to Cupertino.
- Entrepreneurship and Scrappiness: Steve Kang’s Power Computing outpaced Apple in speed, daring, and aggressive sales tactics, but ultimately could not survive once Apple pulled the plug.
- Corporate Strategy Lessons: Apple’s closed ecosystem—once a weakness—became a defining strength post-Jobs’s return, cementing its modern identity.
Suggested Listening Points
- Origins of Steve Kang & Power Computing (03:46–08:15)
- Apple’s Licensing Dilemma (04:40, 11:20)
- Power Computing’s Mail-Order Disruption (15:31–22:10)
- Corporate Betrayal and Jobs’ Retaliation (29:41–37:30)
- Final Reflection on Wealth and Legacy (41:10)
This episode compellingly narrates a pivotal, often-overlooked chapter in Apple’s history, highlighting how business decisions around openness and control can have seismic, unpredictable consequences. It’s a crash course in tech ambition, hubris, and the risk-reward calculus of 1990s Silicon Valley.