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Technology > Tech Investor
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Tech turf wars
HP's numbers and Gateway's new ads show things aren't getting any better.
August 28, 2002: 10:41 AM EDT
By David Futrelle, CNN/Money Contributing Columnist

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NEW YORK (CNN/Money) - Anyone tuning into HP's marathon-length earnings call Tuesday night hoping to find some hints as to the future of tech was almost certainly disappointed.

Aside from Carly's (CEO Fiorina) vague observation that customers just weren't replacing PCs as quickly as they used to, there wasn't much info to be gleaned about anything other than HP's messy particulars (see more).

No, those looking for guidance would do better to look at rival Gateway -- or at least its latest ad campaign, which, quite unintentionally, speaks volumes about the dilemmas faced now not only by Gateway but by many in the tech world.

The latest strategy

In a strangely off-key series of TV, print and Web ads launched this week, Gateway pitches its new Profile 4 computer as a sort of iMac-killer. "New Gateway Profile 4 All-in-One PC Isn't Just Beautiful -- It's Smart, Powerful and Thrifty, Too," blares a press release.

Brandishing the results of recent side-by-side comparison Gateway brags that its "ultra-stylish" machine can, among other things, load big pdf files a full six seconds faster than the iMac.

Ooh -- pinch me!

I don't imagine Apple's Steve Jobs is quaking in his boots.

For one thing, Gateway's PC is hardly "beautiful," at least to this Mac fan. The latest iMac may look like a desk lamp, but at least it's an elegant desk lamp. Gateway's Profile 4 looks like the third-runner up in a design competition to see how much computer you can balance atop a keyboard.

As for performance, well, no one buys an iMac expecting the speediest performance at the lowest price; they buy an iMac because they hate the clunkiness of Windows and are sick of the dreaded blue screens of death.

Gateway's off-key ad campaign is clearly the work of a company desperate to find sales wherever it can. Having been run nearly into the ground by the ruthless efficiency of Dell, Gateway must figure that the best it can hope for is to steal a few bites of Apple's tiny slice of the PC pie.

Good luck. Apple's products may only appeal to a narrow niche of PC buyers, but Apple at least seems to understand what the Mac faithful want.

Competition is heating up

As Gateway tries to steal Apple's customers, of course, Apple itself is trying to steal Gateways (and HP's, and Dell's) with its "Switch" campaign.

Apple's ads, featuring an assortment of appealing offbeat real-life "switchers," are far more stylish and imaginative than Gateway's crude ads. But it's still far from clear how many Windows users will be moved to actually make the switch: by Apple's own admission, only about 60 percent of the visitors to Apple's "switch" Web site are actual Windows users checking out the alternative.

The rest, presumably, are Mac users with a crush on Ellen Feiss, a charmingly laconic student "switcher" who's developed something of a cult following.

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Prepare yourself for more such ad campaigns like Gateway's as other tech firms try to make up for stalled or slowing industry growth by sniping customers from one another -- oftentimes in businesses they don't know well, or at all.

Dell, for example, is moving beyond the direct PC business it knows so well into handhelds, unbranded "white box" computers sold through dealers and printers -- a business HP knows a heck of a lot better than Dell. Cisco is moving into storage.

The resulting slew of nasty ads will no doubt make even the most cynical observers long for the good old days of Gateway's talking cow -- even if they still can't explain why on earth a cow, even a talking cow, would have a deep male voice.


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