The information on this page was not written by me but the author does a great job explaining the difference between proprietary (name brand) and non proprietary (custom built) computers

Proprietary Computers Vs. Custom Built Computers
Both have their advantages and disadvantages, and both have costs that you should know about. Most of you probably have already made your decision, and may find some of this information unsettling. Hopefully you'll be able to understand what this information means to you before your next computer purchase.
What is a proprietary computer?
When you walk into a computer store, it's really difficult to know what you're dealing with without some real background knowledge. Most salespeople I have talked to barely understand this knowledge, so having this information gives you a real heads-up on making the right purchase.
A proprietary computer is a computer that has parts in it that are meant only to be available from one retailer or manufacturer. Most people take the word proprietary to mean IBM, Compaq, and others. This is technically not right. Every notebook is proprietary in some fashion. Some computers are proprietary, but barely. Some computers are 100% proprietary. Telling the difference is important.
Proprietary computers have parts in them that are only meant to be replaced by a manufacturer's replacement part. For example, Compaq motherboards can only be replaced by Compaq motherboards, unless you want to replace the video card, sound card, and other pieces of the computer at the same time.
Some motherboards themselves are proprietary. For example, most Intel motherboards come with their own integrated video cards. This (by my standards) is a bad thing, something that could cost you later on. Why is proprietary-ness bad? Simply put, Compaq, IBM, and most of the other big-name computer manufacturers don't want to help you upgrade your computer when it becomes outdated. Gateway doesn't even bother trying. They want you to buy a new computer instead, forking out thousands of dollars to upgrade something you already have.
How do you tell a proprietary computer? If you buy a Dell, Compaq, IBM, Hewlett Packard, Gateway, Toshiba, Sony, or other big-name computer, it's proprietary. It's a catch 22, as the best-known computers are also the most expensive to own.

So why buy a Proprietary computer?

The first reason is price. It has to due with an economic term called "economies of scale". Basically, the more you produce of an object, the cheaper each unit becomes to produce. Therefore, big-name manufacturers can offer you a cheaper price. (Well, in the short run anyways.) Some of this is because they produce so many they can get prices far below a custom builder. The other reason is they subsidize selling cheap computers with advertising and program gimmicks that you find when you open your new computer. Another reason why proprietary computers are better is the way they are designed. When Dell creates a motherboard, they build it with certain tolerances in mind. Everything about that motherboard is checked and re-checked to make sure it will function properly every time you turn it on. They use the same parts on every system to ensure they know that it will work 100% every time.
This is in sharp contrast to a custom built computer. Having worked in this field, I can tell you horror stories. Thankfully, they have become fewer and farther between as we've progressed to better technologies, but they still exist. The problems are exactly opposite those of a major manufacturer; They buy in small batches, and put together equipment in different configurations every time.

Proprietary Vs. Custom

So what are the exact differences that you should be aware of? Here is a list of the differences, and why they should affect your computer buying.

Upgradeability

The word proprietary states right away that you're going to have problems with upgradeability. You can't put Ford parts in a Chevy, and you can't put a Tyan motherboard off the shelf into a Dell computer. Each proprietary computer manufacturer lives off this concept. They want you to use your computer, love your computer, and come back in 2 years to buy another one from them. Custom-built computers do not have this problem. If a year from now you want a new video card, you buy a new video card and put it in the computer. All the parts are interchangeable, from the motherboard right down to the screws that close the case. They are meant to last, and if you start having problems you take out the problem and replace it. In terms of upgradeability, this is no contest. Custom built computers save you big upgrading money later on. Having sold both, I can tell you that I felt better knowing that the custom-built computer was going to be around a lot longer than the proprietary one.
Drivers

Here is another section where the custom computers have a real advantage on the proprietary systems. Drivers are the language that tell the operating system how to make your hardware run. When you buy a custom computer, you're buying a bundle of parts put together in a workable fashion. Because of this, you can get drivers updated on a monthly and sometimes daily basis. Proprietary computers tend only to upgrade their drivers when there's a problem.
The other problem with proprietary computers is that you might not know what parts you have in the computer. For example, a Gateway computer I worked on recently had an ESS sound card in it. How could I tell? I had to take off the cover and look at the chipset on the sound card. Thankfully the sound card wasn't built into the motherboard, or I might not have found it. When you buy a custom computer, you can find out fairly easily which sound card you have. Not only that, but the drivers are updated by the sound card maker, not the motherboard maker. Who do you think is better qualified to write drivers? A computer manufacturer who uses parts produced by someone else, or the person that produced the parts? The choice is obvious.
Reputation

Computer stores that build custom computers tend to have a bad reputation. This is because they are small, and go out of business fairly easily. Running a computer store is frustrating, especially when you are in a highly competitive market. The sad fact is that 50% of computer stores that open close within 2 years.
This means that your warranty that you bought (probably a 1 year parts and labor deal) is worthless. Most of the hardware has 90 day warranties, and RAM and CPU warranties are generally only good for 10 days. This could leave you in a big predicament if the store you buy from goes out of business.
On the other hand, major manufacturers have reputations of their own. Compaq is referred to in many circles and Compaq, because they are ridiculously bad at service and support. IBM is pretty good at support, but only when compared to the other major manufacturers. For every bad story about a local computer store, there is probably 2 for the major manufacturers.

On this one, there is no right choice.

The lesser of two evils
So now that I've totally bashed every computer store in the world, I guess it's time I made up your mind for you, right? Although I have my own HUGE personal biases, I do not intend to force them on you. Simply put, you need to make up your own mind. Doing that involves some choices. The list of choices you should be making when you buy a computer is presented below, as well as a list of choices you should NOT be worrying about; What to worry about
Cost Vs Upgradeability You will pay a little more for a custom-built computer, but get less spam and get a computer suited better to you. If you want to pay less now, you will pay more later. Service
As good as any one computer might be, it's more important to get a computer with a good, reputable service plan. Research the company, and ask your friends about what service they received. Remember that everyone has had a bad experience once, so don't be surprised to hear a few complaints.

Sales People

Sales people are the hemorrhoid of the planet. I know, I used to be one. Next to lawyers and politicians, sales people are the most hated people in the universe. The trick is to find a sales person that knows what they're talking about, and isn't out to sell you a computer. I also sold computers based on teaching the people something about the computer they bought, not getting the computer out the door as quick as possible. Software
Proprietary computers come jam-packed with software. Unfortunately, 90% of it is demos and limited-time or limited-function versions. You may get a fair amount of software, but how much will you really use? Custom computers come with less software, but generally you can trade the software package for a cheaper sale price, or even get different software installed for the same price. Location
The computer store that sells those Compaq computers may be close, but most of the time their service desk isn't. Expect long waits while your computer lies dormant as the cogs of technical support slowly turn your way. The local store is just that; Local. They can be contacted easily, and often don't charge for software support. (Dell and others charge $35 an hour for software support, even if the software is theirs.) Warranty
When you buy a proprietary computer, you have very few worries about your warranty being trash in 6 months. You should realize that when your CD-Rom drive breaks, they don't put a new one in; it's replaced with a previously defective unit that's been fixed to be put in your computer. Custom computer builders are in a bind when it comes to warranty. They don't carry a tremendous stock of computer parts, and 6 months from now won't even have your video card in stock to replace it. Make sure you get a warranty in writing that tells you how equipment that is no longer being made is going to be replaced What not to worry about

Color	People that worry about the color, shape, or noise of their new computer are wasting their time. Color has nothing to do with performance, computers will always be bulky, and the noise will always be there. You should spend 10 times the amount of time worrying about how the keyboard feels as you should worrying about color, shape, or noise.
Internet Access	So many places are offering internet access as a selling point for computers now. You're not getting free access. You're paying for it. Don't buy a computer based on getting free internet access.
What Your Neighbor's Have	A common problem with computers is that people think they need one better step than their neighbors. This is a bad situation to begin with. To try to "out-buy" someone means you're going to pay more. The more you worry about having the fastest computer on the block, the more you get ripped off. Buy a computer that does what you need it to do, plus a little so it will keep on doing what you need. Don't buy that Pentium 40Ghz because your friend has a 39Ghz.
Free Stuff	You know that deal Dell always has where you get something free? Surprise, you're still paying for it. They incorporate it into the price. And most of the time it's low-end stuff that you wouldn't buy anyways. Free stuff just isn't free.
"Well He Said..."	NEVER EVER buy a computer based off what your "friend" said unless your friend is a network administrator, professional computer purchaser, or is in the field of buying and installing computers on a regular basis. So many people make bad buying decisions because a "so-called" expert told them to. If you wouldn't buy a car from them, don't take their advice on buying a computer.