CompUSA Agrees to Sell Gateway PCs

Gateway signed up another retail partner for its desktop PCs this week, agreeing with CompUSA on a deal to place Gateway-branded PCs at 226 stores across the U.S., the company says in a release.

The retailer is the second company to agree to distribute Gateway PCs since the company decided to close its own network of unprofitable retail stores. CompUSA already sells PCs from EMachines, which Gateway acquired earlier this year.

Gateway did not release any details about the PCs that will be available at CompUSA's stores. The company introduced new models when it announced a distribution deal with Best Buy in July, but it's not clear whether the CompUSA deal will result in a new line of products or whether the stores will carry existing products.

Product Plans

After acquiring EMachines' low-cost PC brand, Gateway split its PC division into two categories. EMachines desktops use processors from both Intel and Advanced Micro Devices, and generally cost less than $700. Gateway-branded PCs use only Intel processors, and generally cost more than $700.

Gateway has decided to get back to its roots by re-emphasizing its PC business. Recent forays into consumer electronics products were ultimately unprofitable in most categories, new Gateway Chief Executive Officer Wayne Inouye said last month.

Inouye has wasted little time in revamping Gateway in the lean image of EMachines, his former company. Gateway plans to reduce its workforce to fewer than 2000 employees by the end of the year, down from 8500 in the middle of 2003, and to simplify its product lines.