"It's really a diversification of our product line. You see us in higher margin product categories. That we're more competitive on price in the marketplace. Gateway became successful by doing a few things. Selling a better product, at a better price, with better service and support. The PC business, due to the commoditization of that market, it's been difficult. But you look at the new categories we're getting into, whether it be digital televisions, digital cameras, digital audio products, connectivity... we're in more product categories than we've ever been in. These are higher margin, higher growth categories.
Gateway believes its direct business model can help it sell those kinds of products cheaper than big consumer electronics chains. It is selling a stand alone DVD recorder for home entertainment systems, for instance for under 350 dollars. But rival Dell... is entering the flat screen TV business too. Was Waitt surprised...
"No, I'm not surprised at all. I've known Dell for quite some time and compete with them. And I'm not afraid of competing with them. We've got a much broader product line."
Gateway's Ted Waitt. Bloomberg Boot Camp, I'm Fred Fishkin.