Watch in awe as executives at Gateway Computers make their company and brand disappear! Gateway Computers announced on Friday that they will be moving to a "100% Indirect Sales Model" Umm guys, have you not been paying attention? In business, generally, more distribution channels is better than fewer, especially for a product manufacturer like Gateway.
Gateway was a pioneer in the direct sale of computers back in the late 80's and early 90's. You called their toll-free number, told them what you wanted, gave them your credit card, and they put it together and shipped it to you. A very low-cost/high profit model.
Now, Gateway intends to do away with all of that, going to a distribution model that's just like every other product we buy on a day to day basis. I guess this could indicate the total market saturation of computers in general. I mean there are literally dozens of players in the computer field and they all basically do the same thing: Buy components from other manufacturers (i.e motherboards, memory, video cards, hard drives, wireless cards, etc), put them together in their own, branded, case, mark it up and sell it. There's just not a whole lot of innovation in that process.
Gateway could try to develop a new way of computing. They could develop some great new product that generates a lot of buzz (i.e. The Eee PC). They could try to expand their market share by developing new ways of making computers cheaper in general, or more energy efficient. How about Gateway trying to reestablish it's brand by declaring itself "The greenest computer you'll ever own", and then developing systems that meet that standard. Surely with all of the "Global Warming" buzz, that would get someone's attention.
But no. They decide to keep being a simple computer assembly-line and decrease their market value and exposure by removing distribution channels. Oh well. So, sadly, Gateway may be going the way of the Dodo. Sadly because I used to own a Gateway and it was actually a pretty good computer, at the time. But alas all things must come to an end. Maybe Dell will buy them out...
4 comments:
Acer bought Gateway last year (I believe) and Gateway's business line went to MPC.
Anonymous,
I'm aware that Acer bought out Gateway. I'm also aware that some analyst believe that this is a lateral move to eventually merge all of Acer's product offerings under a single brand.
This was merely my commentary on what I believe to be an overall poor decision to remove an obviously workable distribution model.
Clarification: My closing comment about Dell buying them out was a jab at how Dell actually is trying innovate. Their new Studio line of desktops is an incredible idea and Dell seems to be very serious about keeping as many distributions channels open as possible.
I remember owning 2 Gateways, the first one was a P5-133 (the screen was made in the UK and the PC was made in Ireland, or maybe vice versa) back in 1996, it was the nicest thing I've ever had. All the problems I've had with it were because I used to tinker a lot with the registry, I never had a hardware problem. The second one I owned was a P3-800 that I bought in 2000. The CD drive broke in less than a year.
I remember their fancy packaging, and I remember receiving over 20 CDs (Windows, applications, games, drivers, etc...) in the same packaging of the first one. How many DVDs/CDs I have received with my new VAIO? None, Nada, Zilch... I have an icon right now on lower right corner of my screen urging me to create a recovery disc (How hard would it be to ship one with the laptop?).
I remember at one point Gateway purchased Amiga, and suffered, as every other company, the "Curse of the Amiga". Amiga, btw, was something that I wanted all my life.
I feel sorry for Gateway, in my opinion they should have focused on selling solid computers while everyone else was going the cheap way. I also feel sorry for Toshiba (check their line of products right now, garbage quality hardware). Toshiba used to make (in my opinion) the finest laptops in the world. I bought my Toshiba laptop back in 2003, and I've retired it just 2 weeks ago (July 2008). I've never had a problem with it.
I don't want to sound too nostalgic over a piece of hardware, but back then (1996) I had the feeling that PCs were made with love and to be loved...
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