Dell acquires PC maker Alienware in bid to corner market on gaudy case designs

Dell announced that it has entered into a definitive agreement to acquire PC maker Alienware. Terms of the planned purchase will not be disclosed. Alienware is a PC maker of gaming and multimedia computer systems. Dell said Alienware will operate as a wholly owned subsidiary following completion of the transaction and will maintain its own product development, product marketing, sales, technical support and other operations as well as brand. The management and founders of Alienware will continue to operate the company as a standalone unit of Dell.

“Alienware’s products are an excellent complement to Dell’s own line of high-performance computers designed for gaming, enthusiast and media content customers. In addition to offering high-quality, high-performance products, Alienware has tremendous brand appeal with consumers and creative business professionals,” said Michael Dell, chairman in the press release.

“Alienware has a legacy of success designing the highest-performance PCs using bleeding-edge technologies and innovative industrial design,” said Nelson Gonzalez, CEO of Alienware in the press release. “We believe that Alienware will realize significant advantages from Dell’s world-class supply chain and operational efficiencies. They will allow us to continue to satisfy our core customers with the most innovative and highest-performing PCs, and ultimately extend the reach and appeal of the Alienware brand.”

This is the first acquisition by Dell of a fellow computer maker. “Dell meanwhile has become synonymous with basic, inexpensive boxes. The world’s largest computer makers has been pushing its XPS line in an attempt to gain a foothold in the high end PC market,” Tom Sanders reports for vnunet. “Dell’s financial performance has been under pressure in recent quarters as the firm struggled to sell computers in the high performance segment and had to witness how the majority of its sales shifted to inexpensive systems.”

“High end systems offer higher profit margins than the volume business that Dell is best known for. The volume segment furthermore is facing fierce competition from Asian manufacturers. Rahul Sood, chief executive of Alienware competitor Voodoo PC first hinted at the pending deal three weeks ago in a blog posting. He pointed out that high end PC makers were challenging Dell’s ‘perceived technology leadership’ which could ultimately undermine its position in the consumer market. He also argued that the rise of Apple had stolen Dell’s spotlight as the trendsetter for the PC business,” Sanders reports.

Full article here.

MacDailyNews Take: Dell’s XPS line not cutting it? Interestingly, Alienware does offer AMD-based PCs, while Dell has thus far resisted using processors from any company other than Intel.

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46 Comments

  1. Looks like good ole M. Dell took a page out of Microsoft’s book. If at first your stuff doesn’t succeed (XPS line), buy a smaller, successful company.

    Too bad for Alienware and it’s customers.

    Peace.

  2. I’d like to know some of the details of this deal. It sounds like Alienware was coming up short on cash so they whored out their brand name to Dell, saying that it will help them beat Apple(???).

    Onwards and upwards pc dweebs.

  3. Here’s Dell’s “ultimate” 3D gamer system.

    • XPS 600 Renegade with a overclocked 4.26 GHz dual core Pentium 965 Extreme Edition

    • Four GeForce 7900GTX graphics processors

    • Ageia PhysX ‘Physics Processor’ add-in card

    • 30-inch 3007WFP display, resolution of 2560×1600

    • Firepainted case.

    • RAID O pair of 150 GB 10,000 RPM RaptorX’s

    • only $9,930

  4. That’s too bad. Alienware was one of the few PC builders that I’d heard good things about. Yeah, they’re ugly but in a good way. Oh well. The PC world just got a little more mediocre.

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