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Week in review: Psystar and the Mac minions

A saga surrounding Mac clone maker Psystar grabs the attention of Macdom. And news from three tech bellwethers offers reassurance. (By CNET News.com's Leslie Katz)

Capping a saga that had Apple watchers atwitter all week, the payment-processing merchant for Mac clone maker Psystar abruptly ended its relationship with the company after it discovered what was for sale on Psystar's site.

Psystar's Open Computer comes preinstalled with Mac OS X Leopard, a violation of Apple's licensing agreement for its operating system.

Powerpay had been the payment processor for Psystar's online store until Wednesday, when it yanked its services from Psystar's Web site. That move sent the store offline midday Wednesday and it has been available only intermittently since then, halting sales of Open Computer.

Psystar, assuming the company is legit, could be in a position to test the strength of Apple's end-user license agreement for Leopard in the courts. Specific provisions of EULAs have been litigated, but the overall concept has yet to be tested in U.S. courts. As of Friday morning, Apple has not commented on Psystar, but reporter Tom Krazit will have the scoop if and when it does.

While Macdom was scratching its head over the Psystar shenanigans this week, some in the tech world were breathing a sigh of relief. Earnings news from several tech bellwethers could, amid economic worries, help reassure the industry that the world isn't about to implode.

Google on Thursday topped pessimistic Wall Street profit expectations, reporting a net income increase of 31 percent to $1.31 billion for its most recent quarter. The company's stock surged more than $54, or 12 percent, to $503 in after-hours trading. That marks a significant step toward the company's all-time high of $747.24 in November.

Google's earnings report comes amid fears that an economic slowdown or recession could be hurting Google's paid-click results, and a SearchIgnite report this week did find that Yahoo is stealing some of Google's search advertising thunder.

But Google Chief Executive Eric Schmidt calls the worries baseless. "It's clear to us that we're well positioned for 2008 and beyond..." he said during a conference call.

Could Google's earnings make Microsoft yearn more for Yahoo? News.com Editor in Chief Dan Farber thinks so.

Intel, too, had a bullish first quarter. The chipmaker reported revenue of $9.7 billion, up 9 percent from the same period last year and a little better than Wall Street analysts were expecting.

And count IBM among those reporting a strong first quarter. As CNET News.com editor Jim Kerstetter observed, "Now you have the most important company in PCs and servers, the most important business tech company, and the most important Internet company all saying the same thing: We're confident in the rest of the year, "regardless of the business environment we find ourselves surrounded by," as Google's Schmidt put it in an earnings call."

For Advanced Micro Devices, however, times are still tough. The company's woes continue with a $358 million loss. The company's processor business took in more revenue despite not having its two best products available for much of the first quarter, but at the expense of profits.

Console bragging rights
In other numbers news, Microsoft, Nintendo, and Sony all used the release of The NPD Group's March video game industry sales report to tout their supposed successes.

"In March, Nintendo again defined industry momentum in both home and portable video game sales," Nintendo said in an e-mail response to the report.

Microsoft weighed in with its own celebratory e-mail, saying that according to NPD, "consumers continue to make the ultimate vote for Xbox 360 as the console of choice."

Sony, not to be left out, trumpeted the PlayStation 3's 98 percent sales growth from the same period a year earlier.

Elsewhere in the game world, Electronic Arts and its takeover target, Take-Two Interactive Software, are back to sparring after a few quiet weeks.

The latest round between the video game makers got into full swing Friday morning, with word from EA that it would extend its Friday deadline for buying up all Take-Two shares by a month, to May 16. But even as it gave with one hand, it took away with another: EA said it would trim the per-share offering price to $25.74 from $26, given newly OK'd stock grants to Take-Two's management, ZelnickMedia.

The new offer continues to be inadequate and undesirable, according to Take-Two. "It undervalued the company at $26 per share, and it certainly undervalues Take-Two at $25.74," Strauss Zelnick, chairman of Take-Two, said in a statement.

But Zelnick isn't the only one who's unhappy this week. A former Harvard University classmate of Facebook founder Mark Zuckerberg's, having run into problems promoting a self-published book that uses the company name in the title, has petitioned the U.S. Patent and Trademark Office to have the trademark cancelled.

Aaron Greenspan, a 2004 graduate of Harvard, has claimed ownership of the concept behind Facebook, based on a Web project he created in college called HouseSystem--a set of online resources for Harvard students including a feature called "The Facebook."

Now he claims that Facebook's trademark on the term "Facebook" has made it difficult for him to promote Authoritas: One Student's Harvard Admissions and the Founding of the Facebook Era.

Busted over Beacon
And because one legal tussle related to Facebook isn't enough in a week, an angry Facebook user is pursuing legal action over Blockbuster's participation in the social network's controversial Beacon advertising program.

Cathryn Elaine Harris of Texas filed a complaint in the U.S. District Court for eastern Texas, claiming that it's a violation of a federal statute for Blockbuster to participate in Beacon, which shares rental history on Facebook members' "news feeds" unless they manually opt out. She is seeking class-action status, hoping to eventually net $2,500 for each infringement. Stay tuned.

Also of note
Politicos want free wireless broadband on unused airwaves blog...NBC to Apple: Build antipiracy into iTunes...Microsoft plans Office subscription service...Darwin's private papers go digital...Free Bookmooch service puts novel spin on books fines...Lack of technical talent slowing clean-tech industry...Radio stations: We're still relevant in the Internet age...It ain't easy being an indie gamer.