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Gateway Renews CE Effort With LCD TV

2/03/2005 08:42:00 AM Eastern

Irvine, Calif. — Gateway nudged itself back into the CE category that it had all but abandoned in 2004 with the introduction yesterday of a 30-inch LCD TV and the hint that it might refresh its plasma TV line.

The new LCD HD-ready model carries a $1,799 street price and became available on www.gateway.com on Feb. 3. This is the first new TV introduction from Gateway since it jumped out of the CE business last year and decided to rededicate itself to the computer category. Gateway does not have a separate retail partner lined up to sell the TV, but the company hopes to land one, said Kenneth Walker, Gateway’s senior director of convergence platforms.

“We would like to have broader distribution. Right now we are trying to figure out the best strategy,” he said.

One major policy change is the company will not follow its previous CE policy of gaining market share through low pricing, Walker said. Instead Gateway will offer more value.

“Disruptive pricing works when you own your whole distribution chain and does not work as well when you are dealing with other retailers,” he said.

The new TV has 50,000 hours of useful life, a 4-inch deep chassis, 1280 by 768 resolution, 750:1 contrast ratio and 170-degree viewing angle. Input sources include two composite, S-video, RGB, DVI, RJ-11, RF, four RCA audio in and PC in. It also includes built-in speakers.

Gateway said the model’s introduction is not the start of a new large scale venture into CE, but part of its strategy to deliver devices that work well with its core computer products, Walker said. In this case, the TV is being marketed as a potential adjunct to Gateway’s Media Center PCs. He did not dispel the notion of the company adding more CE products, but they would have to fall into the same computer-centric category.

However, the company will likely update its two unit plasma TV line with new screen sizes and chassis, Walker said.

The company continues to sell two 42-inch plasma TVs along with a 26-inch and 23-inch LCD TVs on its web site, but these essentially are leftover designs from its previous business plan that have only received modes upgrades since their introduction.

Gateway all but left the consumer electronics space last year after rolling out more then 100 products that were to sell through its Country Store retail chain. The experiment failed to gain much traction and was finally killed off with Gateway’s purchase of entry-level PC maker eMachines in March 2004. After shuttering its chain, the company found it could not sell its CE products through other retailers and decided to alter course back to being a full-time PC vendor.

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