Packard Bell

Packard Bell is a personal computer hardware brand which originated as Packard Bell Electronics, Inc., an independent American computer company. Packard Bell Electronics was founded in Los Angeles in 1986 by Israeli-American investors who bought the trademark rights to the historic Packard Bell Corporation from Teledyne; in spite of similarities in their names, Packard Bell has no connection to either Hewlett-Packard or Bell System.

Packard Bell helped to pioneer the mass market for PCs in the United States by selling in big office stores. In the early 1990s, the company entered the European market and opened its regional headquarters in Wijchen, Netherlands, in 1993. By this time, they had become the second largest original equipment manufacturer (OEM) for IBM PC–compatibles in the U.S. Packard Bell merged its operations with Japanese electronics conglomerate NEC, known as Packard Bell NEC, in 1996; NEC took majority control in 1998 and made it a subsidiary.

At the time of the merger, Packard Bell was the largest PC maker in the American market having overtaken Compaq, but increasing competition and losses led to NEC stopping its North American operations by 2000, focusing squarely on European and other markets under its profitable Packard Bell Europe in the Netherlands, which later diversified to products such as portable media players. This unit, renamed to NEC Computers International, became responsible for all Packard Bell and NEC operations outside of Japan and China. In 2006, NEC divested the Packard Bell division to Chinese-American entrepreneur Lap Shun Hui, and in 2008, the brand was acquired by Taiwanese firm Acer, in the aftermath of their takeover of Gateway, Inc. Packard Bell BV under Acer, based in Nijmegen, continued making Packard Bell products for the European, African and Middle Eastern markets until at least 2013. Southern Telecom Inc. later acquired the rights to the brand in North America and started selling PCs there in 2018. Universal Exports Group Limited, a Hong Kong based manufacturing company, licensed the brand name from Acer in Taiwan in 2019 for the SADC region.

The Packard Bell computer company was incorporated in Chatsworth, Los Angeles, California, in 1986 by Beny Alagem, Jason Barzilay, and Alex Sandel, three Israeli-born United States businessmen based in California. Packard Bell was previously the namesake of an American consumer electronics company founded in the 1920s, Packard Bell Electronics. The latter made a name for itself for its radios before branching out to television sets in the 1950s.

In the 1960s, as with many American consumer electronics companies, Packard Bell encountered difficulty in the marketplace due to increasing competition from Japanese companies like Sony, Sanyo, and Panasonic. In 1968, Packard Bell was acquired by Teledyne Technologies, an electronics conglomerate. Teledyne let the Packard Bell trademark languish in the following years; by the mid-1970s, it was all but retired. Alagem, fascinated by Packard Bell's history as a once-beloved consumer electronics brand, bartered Teledyne for the rights to the trademark for just under $100,000. Alagem later found that brand recognition for Packard Bell was at 70 percent, among a random sampling of adults in the United States.

Alagem and Barzilay met in the 1970s after the former had graduated from Cal Poly. Together, they founded a semiconductor distribution company. In 1983, they merged with another electronics supplier owned by Sandel to form Cal Circuit Abco, Inc., in Woodland Hills, California. Cal Circuit Abco sold computer peripherals on top of semiconductor and had generated over $500 million in annual revenues by 1985. Seeing the increasing commodification of the IBM Personal Computer standard by way of clone makers, or companies that manufactured systems which were plug- and software-compatible with the IBM PC architecture, the three businessmen decided they wanted in and reincorporated Cal Circuit Abco as Packard Bell Electronics in 1986, after Alagem had bought the Packard Bell name from Teledyne. The three leveraged their business connections with Asian electronics companies formed through Cal Circuit Abco to contract the production of an IBM PC clone. They settled on several companies, most prominently Samsung Electronics of Korea and Tatung Company of Taiwan—the former designing and manufacturing the desktop chassis and motherboards and the latter supplying their monitors.

The first Packard Bell PC was released to retail in late 1986. As the hardware was largely bare-bones and derivative, the company could not market the computer based on technical merit, nor could they stand to profit from royalties on patents. Instead, the founders were forced to rely on a low price tag for the system, as well as the founders' shared knowledge of marketing and merchandising learned from their electronics vending businesses. In selling the computer they developed three core strategies: equipping their computer systems with various value-adds while selling the complete bundle at a low cost, leaning on the history of the Packard Bell name, and vending the computers at mass retailers.

Packard Bell was the first PC clone manufacturer to have the MS-DOS operating system and various pack-in applications preinstalled onto the computers' hard drives, saving customers the hassle of formatting the hard drive with a functional file system, while providing novices basic software to get a running start on the PC paradigm. The hard drives of Packard Bell's low-end line-up of computers were larger than the competition's hard-drive-equipped offerings, at 40 MB, while sold at a lower price. Packard Bell was one of the first PC vendors to offer systems with both 3.5-inch and 5.25-inch floppy disk drives, providing a bridge to the newer 3.5-inch floppy format—the use of which in the PC world was being accelerated by IBM with their next-generation PS/2 line of personal computers.