“Taiwan’s Acer will buy Gateway for $710 million, creating the world’s No. 3 PC maker and doubling its U.S. presence while dealing a blow to arch-foe Lenovo’ efforts to grow in Europe,” Sheena Lee and Sophie Taylor report for Reuters.
“Acer said the merger would create a company with more than $15 billion in sales and 20 million PCs shipped per year, adding it would keep the Gateway brand in the United States,” Lee and Taylor report. “On a worldwide basis, the tie-up would help Acer — Taiwan’s most recognized global brand — displace Lenovo.”
“The deal would help Acer immediately double its U.S. market share, combining its own 5.2 percent of the market with Gateway’s 5.6 percent, according to second-quarter market data from IDC,” Lee and Taylor report.
“The deal is expected to be completed by December and the merged company would still be a distant third in the United States, behind No. 2 Hewlett-Packard at 23.6 percent and market leader Dell at 28.4 percent, according to IDC,” Lee and Taylor report. “A merged Acer and Gateway would have sold about 18.6 million PCs worldwide last year, or about 8 percent of global sales, compared to Dell’s 39.1 million units, Hewlett-Packard’s 38.8 million and Lenovo’s 16.6 million, according to IDC.”
Full article here.
MacDailyNews Note: IDC placed Apple in a virtual tie with Gateway for 3rd in the U.S. in Q2 07. According to IDC, Apple shipped 960,000 Macs in the U.S. to Gateway’s 965,000 units for 5.6% market share for each. Apple’s Mac business is growing at roughly three times the PC industry average. For the quarter ended June 30, 2007, Apple shipped 1.764 million Macs worldwide, representing 33 percent growth over the year-ago quarter and exceeding the previous company record for quarterly Mac shipments by over 150,000 units.
Aterway?
Gacer?
GaterAce?
Ace of Gates?
Lack of Originality?
yeah, I like that one…..
I can think of better ways to spend $710 million.
I would buy $710M dollars worth of APPL stock!
AJ
That might get you a seat on the board, next to Al.
But don’t let that stop you…..
Awesome news! Competition is good for Lenovo. My favorite is Dell but it’s always good to see strong competitors in the marketplace driving the fantastic innovation which surrounds Microsoft Windows Vista.
After an announcement like this, I don’t know why Apple even tries. Dell should buy Apple for FileMaker Pro and cancel development and production of everything else. It’s all Apple has.
Your potential. Our passion.™
Great. So basically it’s a merger between the medicore and the beleaguered.
Looks like consolidation is happening in the PC market. The big boys trying to find new ways to sell cheap boxes.
Interesting that Apple sold as many PCs as Gateway but managed to make money out of the business.
Headline: Poo Buys Turd!
Gateway has about the same share of the computer market as Apple. Gateway is worth 710 million. Apple’s market cap is 116 billion, or over 160x the size of Gateway.
Sure, Apple is into a lot more things, but it goes to show you what a race to the bottom gets you.
“Acer said it expected to achieve at least $150 million in pre-tax synergies following the merger…”
In other words, the deal is really about trying to find cost savings. Expect a lot more mergers in the near future, folks, as hardware makers, desperate to find “synergies” as their margins tank even further, buy each other up and position it to investors as being about “growth.”
“”The cure for Apple is not cost-cutting. The cure for Apple is to innovate its way out of its current predicament.”–Steve Jobs, 1997
Zeeee wub!
“Why are Macs so much more expensive?!?!”
Well, uh, it’s nice to have a company that stays in business, for one.
Lets run down the “it’s hot, now they are not” in the PC buisness while Apple still is going from the very begining?
IBM
Compaq
Gateway
I know I’m missing quite a few in between.
Of course Dell is begining it’s slow circle of the toilet bowl as we speak.
Now if Apple would only put out a GPS like this
http://technabob.com/blog/2007/08/25/provia-a1-gps-navigator-way-too-sexy-for-itself/
Hurry Apple.. you could own the USA/Euro GPS market with a device like this.
Cheap computers are cheap computers. The components are one generation or more old and/or at the bottom of the good-better-best ladder. Their assembly is bare bones cheap and prone to multiple errors. They use low end OS software like Windows or DIY Linux.
Who needs the aggravation?
I’m pretty sure iMovie 08 has something to do with Gateway’s being absorbed by Acer. Why not, it’s being blamed for everything else!
could you imagine if gaycer merged with dell?
they would be unstoppable in the craptacular peecee market!
someone stop me. please. lol.
Gateway (remember when they called themselves “Gateway 2000”? LOL) is a nobody in Europe.
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Why anybody would spend almost a quarter of a billion on it totally escapes me.
Also, Acer really has the image of total mediocricity. They were good when they were small. They got top-grades for the support.
Then, the volume went through the roof and the quality down the toilet. Support turned into a chaos.
I _really_ hope AAPL can avoid that mistake.
Too bad we don’t have any long-term statistics on the DOA-rate and support-cases for Macs and Macbooks.
That would show if they are on a good track or not
Lenovo’s plans were set back when Gateway declared on Monday that it would exercise its right to take a first attempt at buying the parent of European-focused PC maker Packard Bell.
This is interesting. Gateway goes ninja to take over PacBell to pad its margins but the buzz on the back net tips off Acer who takes it from bush-league to high stakes razamataz. Strike while people are looking for bargins!
Lenovo is doing the same. Its trying to to conquer Europe one laptop at a time and then stand there and look stupid as Acer and Gateway buys up whole chunks of the Euro market at a time.
The CEOs of Acer & Gateway are two very desperate souls who find each other in the struggle to make headway in a very dismal PC market, thanks in large part to Microsoft choking in the last quarter, finally relegating PacBell to the dustbin of history as they all meld into AGP.
Why anyone would want to compete in the PC market is baffling. The single greatest defining factor is price and they’re all in a race to the bottom. Unbelievable!
Microsoft is the biggest factor putting the brakes on that race to the 99 dollar computer as it raises the bar for computer hardware specs and sheds itself of the gravitational pull of legacy baggage.
By the time Microsoft gets its act together there will only be one PC manufacturer left and its name will be… Microsoft.
By then computers will have reached the zenith of its struggle to achieve yin and yang. It will be Apple and Microsoft; two halves of a whole.
Go Apple!
What a shame, Gateway in the very beginning was really great and had those neat print ads. Too bad….
I guess it’s time for Apple to buy Sony’s computer division…
Nice end for Gateway…
I liked Gateway back in, oh, about 94 or so. I used them at my job at the time (public works for county government). They had snazzy keyboard macros that actually worked and were easy to create, and the machines were nicer than most pre-assembled Windows containers.
But the stores were a farce, and, in my area, full of surly high-school dropouts that couldn’t be bothered to actually pay attention to anyone in the store. It was about this time (95) that I moved to the Mac for good, so thankfully I never bought one.
” . . . full of surly high-school dropouts that couldn’t be bothered to actually pay attention to anyone in the store.”
You’ve just described the backbone of the retail electronics industry in the U.S. Nothing but eyerolls, acne and attitude.
20 million computer and $15B in revenue averages out to $750/computer. Interesting business model.
rainer: “Why anybody would spend almost a quarter of a billion on it totally escapes me.”
I’m sorry to be the one to tell you this, but $710 Million is almost THREE QUARTERS of a billion, not “almost a quarter” of a billion. Was that just a typo or are you just dense?
@jcw3rd:
Yeah, I was distracted. I wanted to say 3/4 of a billion.
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It must have gotten mixed up
What! I sent this one in and get no credit! Come on.