When Steve Jobs returned to Apple in 1997 following the company's purchase of NeXT, he ordered that the OS that had been previewed as version 7.7 be branded Mac OS 8 (in place of the never-to-appear Copland OS). Since Apple had licensed only System 7 to third parties, this move effectively ended the clone line. The decision caused significant financial losses for companies like Motorola, who produced the StarMax; Umax, who produced the SuperMac; and Power Computing, who offered several lines of Mac clones, including the PowerWave, PowerTower, and PowerTower Pro. These companies had invested substantial resources in creating their own Mac-compatible hardware. Apple bought out Power Computing's license, but allowed Umax to continue selling Mac clones until their license expired, as they had a sizeable presence in the lower-end segment that Apple did not. In September 1997 Apple extended Umax' license allowing them to sell clones with Mac OS 8, the only clone maker to do so, but with the restriction that they only sell low-end systems. Without the higher profit margins of high-end systems, however, Umax judged this would not be profitable and exited the Mac clone market in May 1998, having lost USD$36 million on the program.
What effect did Mac's decision to brand the Mac OS8 have on companies such as Motorola?
significant financial losses