Yes, Yes, I Know About the Dell/Alienware Deal

[Jason Dunn]

<div class='os_post_top_link'><a href='http://reviews.cnet.com/5530-10921_7-0-10.html?forumID=110&messageID=1826040&threadID=163281' target='_blank'>http://reviews.cnet.com/5530-10921_7-0-10.html?forumID=110&messageID=1826040&threadID=163281</a><br /><br /></div>Ok, we've had quite a few people submitting the Dell/Alienware news story - which is funny because we don't tend to get that many news submissions in general - but I wasn't going to post on it because it's just not all that relevant to the digital media scene. But since many people are contacting me about it, the topic must interest the people that read this site. ;-) For those that don't know this, Dell is buying Alienware. Thing is though, Alienware will be run as a completely separate company, keep their brand, etc. So it's not like Dell will be offering Alienware machines at Dell prices - that's the thing that would make it most interesting to me personally. The deal is made, and I have word from a trusted source that the deal should be announced next week, around the 29th of March. <a href="http://reviews.cnet.com/5530-10921_7-0-10.html?forumID=110&messageID=1826040&threadID=163281">This email message</a> is purported to be from Nelson Gonzalez, the CEO of Alienware. Here's a quick quote:<br /><br /><i>"Since 1996, our success has been such that we have developed an enviable customer following, as well as the respect of industry analysts and the media who have acknowledged the growing power of our unique brand. And in the spirit of extending the reach and appeal of the Alienware brand, I am proud to announce that Alienware has agreed to be acquired by Dell."</i>

[mcsouth]

They may be planning Alienware as a standalone unit, but I would still bet that they will benefit big time from Dell's buying power, gaining from the economy of scale on some components.

You never know, Dell may decide to position the Alienware brand as their high end or premium brand for more than just gaming. Considering that Alienware has been branching into new areas on its own, Dell may see some benefit by using the Alienware operation to reach out to the individual niche markets (such as video editing? :wink: ) in a way that they just couldn't as the big breadbox maker (any color you want as long as its beige...).

Granted, Dell has gotten more agressively lately on its own, but I have to wonder how many people see Dell as just a "standard" PC maker - you might not consider them if you were looking for "something special". With Alienware, they potentially have a way to snag those little niche markets, even if some of them are not so niche.....

[Jason Dunn]

They may be planning Alienware as a standalone unit, but I would still bet that they will benefit big time from Dell's buying power, gaining from the economy of scale on some components.

Indeed, you're very correct - Alienware systems have always been very expensive, so this might bring them down in cost a little.

[Felix Torres]

I've seen a lot of reports on this and they all ignore one basic fact:
Alienware has retail (B&amp;M) distribution channels.

So it would make sense for Dell to use Alienware as a standalone feeder into the world of eMachines and HP/Compaq. Gets them into the big-box vendors without creating conflicts with their direct sales channels.

And, making it actually relevant here, Dell could redesign/move their consumer electronics efforts to Alienware. I'm thinking an Alienware digital music player might've gotten a wee bit more buzz than the Dell DJs ever got...

[alese]

Indeed, you're very correct - Alienware systems have always been very expensive, so this might bring them down in cost a little.

Why would they drop prices? Alienware is not doing bad with their current prices, so they can keep the prices, but they can also save on many components (CPUs, HDs...) going through Dell and make the systems more profitable for them...

[Jason Dunn]

Why would they drop prices?

To move into a new market - right now Alienware stuff is high-end, almost boutique (though not quite Voodoo). If they can shave a couple hundreds bucks off their prices they can eat the lunch of high-end sales from other OEMs.

[Kacey Green]

that's business life you eat or get eaten, there's the occasional symbiotic relationship (joint-ventures)