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ALR leads Gateway onto new turf

New desktops and notebooks take Gateway, known for direct sales to consumers, toward a more indirect sales strategy and a new corporate territory.

New desktops and the first notebook PCs from Advanced Logic Research will nudge parent company and direct-marketing giant Gateway 2000 (GTW) into a more indirect sales strategy for certain models and into corporate territory currently dominated by leading PC vendors such as Compaq and IBM.

Advanced Logic Research (ALR) says it will be offering two notebook and three desktop PC lines that are custom-configured for customers. The computers will be sold through VARs (value added resellers) and distributors, unlike Gateway's computers, which are sold direct to customers.

ALR, which was recently acquired by Gateway and operates as a subsidiary, is a key component of the parent company's strategy for increasing its presence in the corporate market--and this means emulating the sales strategies of longtime corporate market leaders Compaq and IBM. Typically, large corporations deal with middlemen such as VARs and system integrators when making large purchases.

In essence, all PC makers are going to start to look more and more alike as the manufacturers try to duplicate each others' strengths, says Tony Amico, director of PC channels research for International Data Corporation (IDC).

Direct vendors like Gateway will begin to take on the attributes of indirect marketers as they enter the large corporate market; conversely, companies like Compaq will take on the characteristics of direct marketers such as Gateway and Dell as they, in turn, try to cut costs.

Amico says indirect vendors who sell systems through VARs and retailers are trying to reduce the time it takes to get a computer into customers' hands. The longer a system sits in inventory after being built, the more it costs. Manufacturers can shave about 2 percent off of their cost using a build-to-order strategy--or a variation on the theme--which can quickly add up to millions of dollars saved, according to IDC.

Initially, ALR will be building the systems from components shipped by Gateway, but the firm is coordinating a way to ship computers from Gateway to VARs and distributors to realize further time and cost savings. Dell is already doing something similar: Its computers are already handled by distributors in some cases, according to IDC.

Another result of the merger is that ALR is offering notebooks for the first time. The Evolution LT 2000 is an entry-level portable computer for corporate, government, and academic settings. The notebook will be offered with a 133-MHz Pentium processor and also the 166-, 200-, and 233-MHz MMX Pentium processors, a 12.1-inch dual-scan display, 2GB hard drive, CD-ROM drive, and 16MB of memory. Prices start at $2,267 for the base model with the 133-MHz Pentium processor, the company says.

The Evolution LT 9000 will come with 166-, 200-, or 233-MHz MMX Pentium processors with MMX technology, a 13.3-inch active-matrix display, a combination CD-ROM and floppy disk drive that can be used simultaneously, and a 2GB hard disk drive. The base model with a 166-MHz MMX Pentium is priced at $3,848, ALR says.

ALR's desktop PC offerings span entry-level through high-performance systems. The Evolution 4000 will come with a 166-MHz MMX Pentium processor and is priced starting at $1,019, while the Evolution 5000 is offered with 166-, 200-, or 233-MHz MMX Pentium processors and is priced starting at $1,151. The high-end Evolution 6000 with a 233-, 266-, or 300-MHz MMX Pentium II processor is priced starting at $1,645.

The company says the desktop systems offer Intel's LanDesk Client Management and desktop management interface (DMI) hardware. DMI is an industry-standard technology that allows a systems administrator to monitor desktops across a network as well as take inventory of the software that resides there, among other features.