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Apple’s iPhone Fulfilled Gateway’s PC Dream

1/1/2017

 
No Laptop Necessary
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A lot of people forget that many of the attributes of the Apple Store actually originated with Gateway and their Country Stores. The whole idea of having a proprietary showroom where you could demo your computers and have classes to teach your customers how to use them was a Gateway thing. 
​When PC sales finally peaked in 2001 after more than a decade of torrid growth, there was panic in the halls of Gateway. We kept asking ourselves why our customers weren't willing to upgrade their machines to the newest models with the latest processors and more RAM. The answer was simple. For what people were using their machines for, they were adequate.
 
Remember, 2001 was even before social media existed. So all anyone was really using their computers for was e-mail, word processing, and educational software for their kids. I know because I was an operations analyst at the time with access to the sales and inventory figures for the software we shipped. The biggest movers were those cartoon-like programs that would teach your kids the alphabet or times tables.
 
Ted Waitt figured that the problem was that people didn’t know how to work with photos and video. He surmised that if more people did photo and video editing work that they’d want to upgrade to the latest computers. If there was one area where having a more powerful processor really shined, it was working with video. Gateway made it their mission to teach their potential customers how to create photo albums and home video movies.
 
It didn’t work. But it wasn’t for lack of effort. With multiple stores in every major city in America, Gateway could evangelize on a pretty large scale. They held classes and seminars for years on how to make movies, calendars, and postcards. But by and large, most people didn’t want to spend all the additional time and money it was going to take to accomplish nice projects.
 
In hindsight there are a few reasons that should have been obvious:
 
  1. There were no Flip cams or good camera phones back then. Doing video work meant spending another $500 on a decent camcorder or digital camera.
  2. Just getting the video from those magnetic tapes onto your hard drive was going to be an accomplishment.
  3. The software to make movies was expensive, and you had to invest a lot of time into learning it. And you had to sink that much more time into cutting and splicing video and sound. You had to be ready to carve out hours at a time to do simple tasks.
 
But now in 2017, photo and video work is easy and everyone does it. You can now shoot video, edit it, and share it all without ever sitting down at a desk. Social media is built on sharing photo and video snippets, and it’s not a gargantuan process. It all started with the iPhone.
 
The iPhone made having to buy an expensive camcorder unnecessary. It also made having to transfer your media to your computer irrelevant. And iOS blazed the way with its intuitive touch interface that made manipulating photos and video fairly quick and easy.
 
The vision that Ted Waitt and Gateway had of the public one day making and sharing videos on a regular basis has finally been realized. Only, it happened with an entirely different form factor and device. We all assumed that you needed a big beefy computer to do real work with video. Not true.
 
Nobody is going to shoot a feature length movie on their iPhone, but for the kind of video and photo work that most people do? The future has already arrived. Birthday parties, graduations, and special events. All of these occasions that Ted Waitt figured people would want video to share are now getting created with phones, not desktop computers.
 
It’s amazing that the very functions that Gateway figured would drive people to upgrade their computers and boost sales can now be used as examples of why the computer is no longer relevant. 

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    Robert Perez

    Manufacturing and distribution analysis since 1993.

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