January 25th, 2000

[5:00 PM] XLR8's Parent Company Goes Chapter 11 by Bryan Chaffin Word has reached The Mac Observer that XLR8's parent company, Interex, has gone into Chapter 11 bankruptcy. Chapter 11 allows a company to reorganize. Gary Dailey, Director of Marketing for XLR8, says that the bankruptcy should not affect XLR8, as the manufacturer of Mac processor upgrades and other Mac products is an independent and profitable division of Interex. "XLR8 is, and has been for over two years, a profitable division [of Interex]" says Mr. Dailey. "In fact, XLR8 is still growing." XLR8 has been consolidating operations in Atlanta, perhaps in recognition of changes in store for the company. Says Mr. Dailey, "As you may be aware, we set up R&D with Marketing out of Atlanta, early January 1999, and have been working the past two months moving all Manufacturing, and Packaging to our modern Atlanta facility." When asked to comment specifically on Interex, Mr. Dailey told us the following: "Interex, our parent company has been a player the cable and surge business for 17 years. With any distribution company, the edge is always close. I can't comment on any legal issues though." The Mac Observer will follow this story closely as the company works through this transition. The Mac Observer Spin: This has been an era of change for the processor upgrade market. Mactell shut its doors late last year, and rumors of trouble have been circulating about another company as well. There is no doubt that other changes in this market are in store, but we think that the remaining companies will survive nicely, though some may have more varied product lines, and this includes XLR8. The processor upgrade companies have been excellent for the Mac market, especially during and after the fall of the clone companies. By and large, they have all offered excellent products and customer service to Mac users, and for this reason, we wish XLR8, as well as their competitors, the best of luck. Interestingly, it is the very success of Apple that has impacted the upgrade market. Apple puts out sexy machines that make people want to buy them instead of upgrading their old machines. In addition, technology is progressing at a rate which makes it much more reasonable to buy a new PowerMac G4 in order to get the faster RAM, system bus, FireWire, USB, and other goodies that come with it. Add to that the fact that Motorola and IBM have been terribly slow to bring faster processors to market, thereby making it of less paramount importance to slap a new processor in your relatively new Blue & White or Beige G3. Indeed, Apple's most popular machine, the iMac, can't be upgraded at all. While this may make it seem as if we are saying that Apple's good news is the upgrade industry's bad news, the converse is not necessarily true at all. By and large, the upgrade companies sell to customers that would not normally have bought a new Mac from Apple, at least not yet. As such, upgrades keep that segment of the Mac market happy until they are ready to splurge for a new machine. XLR8