Avoid buying eMachines or Gateway products

Avoid Gateway and eMachines computers when considering purchase of a PC

This is a cautionary tale about an eMachines PC, but it's really about Gateway Computer, which purchased the eMachines brand in early 2004.

A customer of Internet Frontier, an older retired gentleman, purchased a new eMachines PC in February 2004. In the next seven months, his new system experienced the same fatal, unrecoverable error three times!!

Each time, we contacted eMachines on his behalf. We were actually on the phone with eMachines about another problem with the system when the fatal error occurred the third time.

Despite emphasizing that it was the same error each time, which would imply that there was something inherently wrong with the system and that the problem wasn't likely to just go away, eMachines was unmoved. Their "hands were tied". All they could do was "reimage" the hard drive, that is, restore it to the way it was when it left the factory. This, of course, resulted each time in the complete loss of all programs, photos, and documents that the owner had put on the system.

After the third time, we spoke to a "representative" in the eMachines "Executive Offices" in Utah. Like the technical support people before him, he was unconcerned that the problem had occurred three times. And in what should be viewed as a glaring revelation, he proclaimed that eMachines' policy was to do nothing more for any system beyond re-imaging the disk until the same problem occurred a fourth time!! That eMachines would see the need to have such a policy should be enough to deter any potential buyer.

Subsequently, we have written twice to the executives of Gateway (again, the parent of eMachines), who have not seen fit to respond in any way.

If you have been a customer of Internet Frontier for any length of time, you know that we used to recommend eMachines systems because we felt they represented a good balance of price and features. We no longer make this recommendation, and in fact, strongly urge that you specifically avoid eMachines and Gateway products.

December 2004; updated 1/8/05

UPDATE 12-20-04: To see the unsigned, self-serving non-response from Gateway, click here.

UPDATE 11-04-05: We have now seen a second eMachines system exhibit exactly the same unrecoverable error as the first! Coincidence? We don't think so. Our guess is that there are many more of them out there, but the owners have simply given up on getting them fixed.

UPDATE 02-09-06: Great news!! Gateway stock down to $2.51, and CEO resigns. Details here.

UPDATE 04-29-06: Stock down to $2.20, loss widens. Details here. (And take a look at the insider trading.)

UPDATE 06-28-06: Stock down to $1.62. (And take a look at the analyst's comments.)

UPDATE 08-04-06: Stock down to $1.40.

UPDATE 08-26-06: Stock up to $1.98 on buyback talk, but read "Get Away From Gateway".

UPDATE 02-24-07: Stock up to $2.12, BUT.... why has co-founder and insider Theodore Waitt SOLD more than 1.5 million shares this month? In fact, Gateway insiders, including Mr. Waitt, have sold more than 13 million shares in the past 6 months, while purchasing only 2 million shares. And institutional investors have sold another 50 million shares (two-thirds of their holdings). Hmmmm??

UPDATE 03-12-07: Stock up to $2.17, but former officials convicted of fraud

UPDATE 05-16-07: Stock down to $1.73. Could the

be next?

UPDATE 06-11-07: Stock still at $1.73, BUT...why has co-founder and insider Theodore Waitt continued to SELL a huge volume of shares, nearly 10 million since mid-February? Check it out here.

UPDATE 08-27-07: Acer saves Gateway from the

. Details here.