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Acer to Acquire Gateway for $710 million
downix writes "On the way into work today, I heard about Acer buying Gateway. A bold move strategically, I wonder what consequences this will have for Gateway's employees and customers. As the purchase price was at $1.90 per share, those of us that purchased Gateway shares a few years ago are reminded just how far it has fallen."
"I wonder what consequences this will have for Gateway's employees and customers."
Gateway has customers?!
Dear diary: Today I stuffed some dolls full of dead rats I put in the blender.
Under the radar of most US consumers, Packard Bell has actually become a fairly reputable manufacturer again in Europe. Last I heard they were putting out fairly good product.
The reason that Gateway and Lenovo are interested in Packard Bell is so they can capture some of the European market without having to go into it starting with nothing.
I've never purchased a Gateway, but I do follow the trends in reliability, price, performance, and support from major vendors. Objectively, Gateway has not "always" made crappy computers. Instead they followed a common trend in computer manufacturing/sales. Within the first few years they made quality machines and had excellent support, both better than average for the price. Then, when they had a reputation and brand, the company executives cashed it in for quick profit by selling machines made more cheaply and poorly and counting on their reputation to get people to buy. The exact same thing happened with Alienware about a year before Dell bought them.
Sometimes at a later date a company can reverse course to some degree. Dell's laptops, for example, have gained in quality and reliability over the last few years and are no longer the cheapest junk they can assemble using whatever is inexpensive today. Usually, however, with enough customers pissed off and vowing never to buy crap from Brand X again, it makes more sense in business to simply start Brand Y and count on consumers do not do any homework or even look at consumer reports instead of the TV ad where the guy says its a good deal.
This takes two companies with minimal brand equity and merges them to provide better buying power and a lower cost of goods. The fact that Gateway was worth only $710 million despite being the third-largest vendor here in the US should say something right there. And it's not good.
Market Cap of some major US PC vendors:
HP 125.68B
Apple 115.8B
Dell 61.63B
Gateway 676.29M
See an interesting trend? Gateway would be pocket change to any of those bigger companies. Basically, they died in retail, were taken over from within by E-Machines (even though Gateway bought E-Machines, the execs from E-Machines wound up in charge - just like when NeXT was bought by Apple) and stabilized just enough to turn into the company into bait for Acer.
Goodbye, Gateway...
-- Josh Turiel
"2. Do not eat iPod Shuffle."
Ah yes, combining the prestige of a Taiwanese electronics OEM with the affordability and reliability of an Italian sports car manufacturer. It's a match made in heaven.
Are they outsourcing the jobs? and I hear a lot of Gateway bashing here. It's understandable, but 8 years ago I bought a gateway. It FINALLY died about 2 weeks ago. This computer handled being on almost everyday, over 150 linux installs a few windows installs and has NEVER been cleaned out with a vacuum or anything. It's dirty as hell and I'm affraid to open it to fix the damn thing. I primarily used this computer for 2 things; 1) Testing all the latest linux distros 2) Downloading my pr0n, warez and music. I think it would still work if I popped another hard drive in. So all in all I had an AMAZING Gateway experience. I wouldn't buy another pre-made PC now that I use laptops and build my own PCs. I needed the Gateway for school at the time and didn't have the time to build my own.