Gateway Completes eMachines Acquisition

ryanjensen writes "Gateway just completed its $289.5 million deal to acquire Irvine, CA-based eMachines Thursday according to News.com. From the article: 'Many analysts believe that Gateway ultimately will abandon some or all of its namesake stores in favor of selling products at third-party retailers. However, they expect the company to continue selling Gateway-brand products, including PCs and consumer electronics, directly to its customers.'"

Comments

Argh Gateway

[Killjoy_NL]

Ok, I love the packaging with the cow motif (if they are still using that), but that's all I like about it.

I had to set up a gateway computer for my uncle a few years back, used the restore cd's and Windows kept f*cking itself up.
I could blame Microsoft for this one, but the horrid restore-menu-architecture was the source of all my anguish.

This and not having an internet connection handy really ruined my day.

Has their software improved over the years, anyone??

Re:Argh Gateway

[Mr Guy]

It has alot to do with luck and expectations. The real beef with Gateway is that they play a numbers game, as do most of the mass marketed computers. They use the confusing nature of PC marketing to sell overpriced computers that have higher fail rates for each part and run slower than they seem like they should. They sell a 2.4 Celeron with PC2100 RAM and their consumers are happy only because it's faster than that 866 they upgraded from, if only just barely. They have no idea they could get a MUCH faster machine by using an AMD 2.4 Barton with PC2700 RAM for roughly the same price, because they do nothing to educated their users. As someone else said about emachines, when chosing between quality and cheap, they always always always chose cheap. You just got lucky and got one without a flaw.

Re:Argh Gateway

[pebs]

I'm not sure I get the general Gateway-hate among geeks. I have 5 computers here, one of them is a Gateway Pentium III 600. I've never had any problems with it whatsoever.

I've never liked Gateway. I bought a used P2-266 for really cheap. The only thing good in it was the motherboard and cpu. Everything else was mostly weird proprietary shit. The case was sick mess, and the cd-rom and floppy drives had curvy plastic on the front which made it completely clash with any other case. The power supply was something terrible, I ripped it apart and only kept the fan that was in it (but the fan was a piece of shit). The motherboard used onboard video for which there was no Win2k drivers, though I can't totally fault Gateway for that, and the board itself is pretty stable.

So, like many other system builders, Gateway takes a decent mobo and CPU, and slaps a bunch of cheap and/or proprietary crap onto it which any self-respecting geek would completely replace. So why not just buy the mobo and CPU and build your own?

From what I have seen, eMachines was starting to produce machines that were actually good (contrary to their earlier reputation). I really hope Gateway doesn't fuck it up. Though, maybe Gateway is better these days, I dunno, I haven't used a recent Gateway, but all the older ones I've used pretty much sucked.

MicronPC, on the otherhand, put out some good PC's back then (around the time of P1 and P2), and they still do. And they sell AMD-based machines. If I have to recommend a system builder, I recommend them.

Re:Argh Gateway

[FictionPimp]

My problem with gateway started in 2000. I had ordered a few computers from them before that in 98-99 for me and my family. I was upgrading my pc and already had a great sound card I wanted to keep. So I asked them to remove the sound card (a practice they never had a problem with before) and I was told that removing the sound card was impossible (it was a non-intergrated card btw, when I received the computer it was a SB128) I was told windows 98 required a sound card and would not run without one!!!

I would of stopped right then and there and built my own pc, but my parents where buying the pc for me and refused to let me build it. Claimed I didn't have the knowege, an excuse I still use today when they call me for support :-) Of couse that makes them wonder what all that money for my certs was for though.

Irvine, CA?

[dillon_rinker]

The last acquisition Gateway made was also based in Irvine, CA: server manufacturer ALR. Does the Gateway acquisitions guy ever leave Irvine? And will Gateway ruin eMachines the way they ruined ALR?

Re:Irvine, CA?

[Anonymous Coward]

And will Gateway ruin eMachines the way they ruined ALR?

Or Amiga. Oh yeah, remember that one?

I didn't even realise Gateway were still solvent, let alone in a position to throw $289.5million at an aquisition.

Re:Irvine, CA?

[nakedsource]

There was a time when you were absolutely right about emachines. But the last 18 months they have turned around and made themselves in the value leader for desktops and laptops. I own a laptop with Athlon XP 2500, 512 megs, 606 gig, integrated ATI graphics and a 16x10 15 inch screen. got it for 1100.00 US and now it's below 1K. No problems so far. And it has wireles and ethernet built in. I'm really worried that gateway will mess them up.

Country Store vs. Apple Store?

[amichalo]

When Apple first announced they would open stores nationwide, people pointed to the then already declining Gateway Country Store profitability and said "Jobs, what are you thinking?"

But there is an obvious difference between the two retail stores. What are the core differences and how could things turn around Gateway or Apple's currernt trends?

Not a rhetorical question - please don't flame!

Re:Country Store vs. Apple Store?

[DaHat]

True, however you've got to admit, from the marketing prospective, there is a great advantage to rebranding... the final product has your name on it! Another major advantage, this time for the customer is tech support from a single house.

Like it or not, most of the people who buy from a company like Gateway are not going to drive down the street to see if the same camera costs a few bucks less, they'll buy it from Gateway or even along with their desktop or laptop and have support from the same company.

A couple of years ago while getting a tour of the Gateway tech support center in Sioux Falls, SD, I was surprised when many of the end calls would end with the tech asking if there was anything else the customer needed like an scanner or digital camera, I was even more surprised that there were quite a few who would want to be transferred to a salesmen to be sold on such a device.

Can anyone confirm this Intel rumor?

[laddhebert]

I was reading another board last week about the sell of e-machines (I had just purchased the m6805 - amd 64 laptop) and one of the posters said the chances of amd 64 chips being released on a wide scale was probably not going to look good at the present time because Intel worked out 2 year contracts with most of the large manufacturers of laptops and desktops such as Dell HP, and Gateway. Since Gateway now owns emachines, it seems likely that their amd64 lines of laptops will be discontinued. I did notice that HP released a 64 bit laptop, along with Toshiba too.

Let's hope these rumors are just that - rumors.

-L

Re:Gateway taking a dagger?

[wolf-]

I have a EMachines 600id that has been running for almost 5 years now.

Straight out of the box, we removed windows ME and dropped linux on it.

Other than an HD in it, its been running as a little mail server/firewall since day one.

Didn't they go bankrupt?

[subjectstorm]

wtf?

i thought gateway was on the verge of bankruptcy maybe 6 months ago. i was actually happy when i heard they were tanking . . . and now they've dropped nearly 300 million on eMachines? what?

did their plasma screens really sell THAT well?

i must have missed something here.

Re:Didn't they go bankrupt?

[DaHat]

I've got a friend who used to work at Gateway and gave me some good inside info on the company... As much as I've been hoping to see them go belly up and die a horrible horrible death, I'm told that they have a rather sizeable pile of cash to be able to sustain them for several years while at a significant loss.

Nice thing about such a piggy bank is you can use it to buy things you want... however it can mean that your safty net gets a bit smaller.

Re:Norelco?

[DaHat]

Despite your experience with a single unit, eMachines has truly gotten their act together in recent years.

In the early fall when I was looking for a laptop, I found the eMachines M5310 (I think it is) to offer the best bang for my buck, XP 2400+, 40 gig hd, 802.11g wifi. It's not the smallest or lightest unit to say the least, however it does it's job wonderfully, hell, I even use it for lan parties from time to time! If only Battlefield would take advantage of the wide screen.

I too back in the day came to despise the name of eMachines, but I gave them a shot. When people first see my laptop they say "I didn't know they made laptops" and walk away quite impressed.

But now Gateway... the definition of crap.

birds of a feather...

[dthree]

This merger makes perfect sense: one mediocre computer company buying another mediocre one.

I actually thought gateway was trying to move OUT of the PC business, with all the consumer electronics they introduced recently. Guess not.

Re:birds of a feather...

[Zrane]

The idea, more than anything, is to use eMachine's established relationships with retail outlets to try and get the Gateway digital stuff like cameras, TVs, etc(some of which are actually quite nice) into the stores, along with the PC's.

I'm not sure how it's going to work out, but the CEO of eMachines is taking over both comapnies post-merger. Maybe he'll have more business sense than the founder and actually play off the company's strengths instead of jumping off in an ever-shifting list of random directions. Of course, given past choices with the cow-box company, it's going to be hit or miss.

Bleh

[Remlik]

Gateway horror story:

Company exec decides he doesn't like the IBM thinkpads we've speced and goes out on his own and buys a Gateway laptop (this is roughly 2000).

We say fine, but we aren't responsible for hardware support as it breaks the standard...right...like that works... For some reason exec can't get his Palm to sync up over the serial connection.

Enter me: 4 long frustrating days spent trying everything under the sun to get this beast syncing. Palm syncs on three other desktops and two other laptops with no problem, install it on gateway and nothing.

Tech call #1 to gateway...OS is corrupt reload from rescue disk. Tech call #2, palm is bad...explain that it works everywhere but on gateway.
Tech call #3...CSR almost gets the balls to tell me gateway doesn't support palm, I inform him that I aint yo mammys foo.

Tech call #4 after talking with 2 differnt people I am finally transferred to "level three" support. Guy comes on the phone, reads case notes and says simply "That model's serial port is defectivly impemented, it will not work, you'll need to get later revision..blah blah blah..."

Laptop goes back the next day for full refund, exec gets a fsking thinkpad and has to explain why the seinor IT guy spent 4 days fsking around with his crappy out of standard laptop. He was gone a month later.

(Shrug) Gateway stores won them ONE customer...

[dpbsmith]

...my wife, who is a careful reader of manuals and a good learner, but not a techie or a computer geek, set out to buy herself a computer a couple of years ago. It was very important to her to do everything by herself without my looking over her shoulder. (You know how annoying it can be when you have a problem and someone sits down at your keyboard, click click type type magic magic and says "works now." Well, it does work, but you have no idea what was changed or why or how to deal with similar problems in the future).

She bought a Gateway specifically because of retail stores where she could look at the stuff, try it, and talk to real, helpful retail salespeople. Plus she liked the idea of her computer coming in a box that looks like a cow.

I don't know what the answer is, but the computer industry is still in a state of self-denial about how difficult and intimidating computer purchases are for the average person. PCs are actually harder to buy, install, and use then they were five years ago. Mail-order is not the answer for everyone, nor are "warehouse" clubs or computer superstores.

I don't know why retail hand-holding isn't working out for Gateway. But I know without it, they would have had one less sale.

A quality match.

[Gr8Apes]

What Gateway needs more than anything else is a QA dept, and not another low-bid business. Over a 4-5 year period from 92-97, their computers went from predictable usable machines to absolute and utterly complete crap. I call it the low-bid phenomenom. Initially, they started low-bidding parts, so that if you palced an order for 20, or even 5 PCs, you had about 90% chance of getting at least 3 different configurations even if you ordered the exact same PC. (namely - different motherboard and memory manufacturers, other peripherals as well though). This lost them lots of business. Then they "dropped" the continuous low-bid philosphy, going for long-term low-bid contracts. yeah. Then we got the infamous 1 in 2 Viewsonic monitors and power supplies dying.

After going through about 2000 monitors, we stopped buying Gateway, forever, as the quality never has been rated anywhere equal to Dell. (Why'd we buy 4000 systems, very large organization, with large upgrade needs at the time, and they were an approved vendor with the best price. For some mysterious reason, after all the problems, everyone seemed to favor Dell for their next upgrade purchase. out of 500 machines ordered in the next year, we had 2 bad hard drives, and 1 bad keyboard.)

Having excellent customer service just doesn't compete with not needing customer service at all.

I use to service them.

[nlinecomputers]

I use to work for a company that did service work for equant, warantech, banctec, etc. We did the warranty repairs on a lot of e-machines. When they first came out the were junk. Best Buy finally dropped the line because of a 20% return rate. They are back in Best Buy now and they are doing much better. Worth a second look if your looking at a cheap computer.

So, will the m6807 come back?

[Rinikusu]

eMachines did the "unthinkable" by releasing an actual kick-ass desktop replacement laptop in the m6805 and m6807 series. Both sport Athlon64's. Unfortunately, since news of the Gateway acquisition, finding the m6807 (which comes with a DVD+/-R) has been an exercise in futility. The eMachines site lists the m6807, but clicking "buy now" gets a "there are no online resellers of this product" message. Circuit City is out. Best Buy never seems to have gotten any, although you can find the m6805 at both.

So, Gateway, eMachines had a great laptop there, don't fuck it up.

Love Gateway Computers

[foo fighter]

We have used Gateway systems at our company for the past five years.

The past two years have been excellent with them. If you order a hundred systems, they'll be identical so you can image and deploy them easily. They have inexpensive long-term warranties and tech-support that will help you out when you have a complex problem. I've had them send me a better monitor when one of theirs burned out. It was there the next day, even before I'd packed up the old one to ship back.

Their cases are nice to work in now. Completely toolless to install cards and drives. The edges are rounded so no more coming out of an upgrade missing a finger tip.

We even have a few Gateway servers now and we've been very happy with them. Absolutely no problems.

I've always liked their laptops better than Dell, Compaq, HP, or Toshiba.

Yes, the first three years they weren't very fun to work with. You'd order a hundred and you'd get three different video cards, four different network cards, different motherboards, in any given machine. That's a huge pain in the ass when you are trying to image and deploy those in a corporate environment.

Don't even get me started on their "if you open the case or install any software you've voided the warranty" bullshit during those few years.

But that's turned around. They are a good computer company, and an antidote to the Dell hegemony in the PC world.