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Life imitates art for Apple

Despite changes in government regulations, Apple Computer has decided not to export its G4 "supercomputer" to dozens of countries, because export restrictions are still too cumbersome.

For Apple Computer, life still imitates art despite changes in government regulations.

Apple Computer has decided not to export its G4 "supercomputer" to dozens of countries, because export restrictions are still too cumbersome.

Civilians in approximately 50 countries such as Russia, India, China, Israel, and Pakistan won't be able to buy Apple's fastest G4 Power Macintosh systems, even though the United States recently relaxed export controls that had prohibited the export of the G4 and other powerful computers, a representative for Apple confirmed.

The United States has in the past sought to curb the export of supercomputers for potential military purposes or nuclear research for national security reasons.

The issue is notable mainly because Apple has actually been touting its inability to export the G4 computer in television ads. The ads state that because the computers are so fast, the U.S. government classifies them as supercomputers and imposes export restrictions.

The restrictions have since been eased, so Apple can now sell to once forbidden markets--which is good news as far as sales are concerned, but also means the ads are outdated. Despite the lifting of the restrictions, Apple said other red tape still limits its ability to export the G4 to numerous countries, according to a report in the "National Journal's Technology Daily," a public policy newsletter. Rather than deal with the legal and political headaches, Apple simply decided not to ship to those countries.

Richard Gardner, an analyst with Salomon Smith Barney, said there would be minimal impact on Apple's financial results because the majority of systems sold abroad go into countries such as Japan, France, and other Western European countries.

Supply is the bigger issue
Customers in the United States might find the news ironic, since some will have some trouble getting a G4 system, too, but for a different reason.

Apple said earlier this week that fewer-than-anticipated G4 systems will ship this quarter due to shortages of the Motorola-made chip. Consequently, the company revised earnings estimates downward for the fourth quarter.

"We are seeing significant demand on all G4 models," said Kelly Johnson, Mac unit business manager for Ingram Micro, which distributes Apple products to resellers. "We've seen the first [large] shipments of the 400-MHz systems, but that hasn't met our backorder," she said.

Restrictions on G4s eased
Sales of high-performance computers are controlled through a four-tiered system in which countries that represent a low risk to U.S. national security, such as Canada, are allowed to import high-performance computers with few restrictions. Controls are tightened for countries that are perceived to be a threat, resulting in a virtual embargo on nations such as Iraq and Libya.

Until recently, Apple's new G4 Power Macintosh computers--along with upcoming products such as the Sony PlayStation 2 game console--were classified as supercomputers under a system government officials have acknowledged as archaic.

When export control rules were changed in August, Apple was free to sell computers to "third-tier" countries such as such as Russia. However, the company has elected not to do so. The U.S. government, in the interest of national security, requires that companies be able to identify who has purchased the product. Apple sells computers to distributors, who in turn sell them to retailers; because of this, Apple has no way to track sales to end users, as is still required by the government.

The amount of computing power allowed is judged in Millions of Theoretical Operations per Second, or MTOPS. Under the revised export rules, the range allowable for third-tier countries increased from 2 to 7,000 MTOPS for a civilian user to between 2,000 and 12,300 MTOPS. Apple's G4 can perform around 2,400 MTOPS, while today's fastest supercomputers perform at up to 1.6 million MTOPS.