CNET : News : Story Friday, February 18, 2000 

Gateway to launch Athlon-based PCs in Asia
By Julian Matthews
Friday, February 18 2000

KUALA LUMPUR--In another swipe at Intel, direct-selling giant Gateway Inc., will launch a range of desktops and notebooks based on AMD's Athlon chip to Asian buyers soon.

"We intend to introduce them in the Asia-Pacific region in the very near future. Once in our product line, they could then be ordered through our normal channels -- web, toll-free phone lines, and stores," said Robert Sherbin, vice president of corporate communications Asia/Pacific Gateway, Inc in an e-mail response to CNET Malaysia.

Sherbin declined to disclose the flavors the PCs would be coming in but Gateway is known to be offering 600MHz, 700Mhz, 800Mhz desktops and notebooks in the US and Europe since last month.

The disclosure comes on the heels of AMD's release on Monday of its fastest Athlon processor yet -- an 850-MHz device -- as an early Valentine's Day present to its PC customers. Gateway, Compaq and IBM all plan to build systems using the chip, according to AMD, beating Intel's debut of its 850 and 866-MHz Coppermine chips set for March 27.

Sources said Intel may actually roll the chips out earlier to keep pace with its rival. The 850-MHz Athlon is priced at US$849 in 1,000-unit lots, slightly less than the US$851 Intel charges for an 800-MHz Pentium III.

Sherbin said the dual-supplier strategy puts Gateway in a better position to meet customer demand. "We can now produce the products our customers are demanding, when they're demanding them. The lesson we learned is the absolute necessity of ensuring that we can meet customer demand at the product sweet spots at peak times, like the holidays," he said.

Gateway issued profit warnings for its last quarter last month blaming it on shortages of Intel chips and BX chipsets. Gateway Chief Financial Officer John Todd was quoted as saying the shortages cost the company up to US$250 million.

A number of major PC manufacturers including rival Dell were affected by the shortfall from the Santa Clara, California-based chip-maker especially during the lucrative selling period between September and Christmas.

Gateway previously phased out AMD chips last year to rely solely on Intel's products after sharp price cuts from the latter.

Sherbin said Gateway has "very aggressive" targets for 2000 in the region. In the fourth quarter, Gateway's unit sales rose 34 per cent and revenue increased 22 per cent. For the full fiscal, unit sales increased 56 per cent and revenue rose 49 per cent, he said.

"Our current hot-sellers in the region include Neo, an entry-level desktop machine sold in Japan and Australia, the Profile, a hybrid desktop/laptop which has a thin LCD screen that houses the guts of the PC and sits on a desk, and Intel PIII 600 machines," he said.

Sherbin said the company was also registering "very healthy demand" for its Solo 9300 notebook range.

Gateway's factory in Melaka state, south of the capital city here, ships product to the entire Asia-Pacific region, and also provides customer service and technical support for all countries except Japan and Australia.

On the hacking incident which affected its Malaysian Web site last November, Sherbin said Gateway had yet to track down the culprit. "It has been somewhat tougher pinpointing the hacker than had initially been thought. We are, however, continuing to work with enforcement authorities to apprehend him."

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