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December 01, 2010, 7:28 PM EST
By Bloomberg News
Dec. 2 (Bloomberg) -- Acer Inc., the world’s second-largest computer maker, aims to capture 15 percent of the tablet market next year, vying against Research In Motion Ltd. and Samsung Electronics Co. to offer the most popular alternative to Apple Inc.’s iPad.
Acer’s shipments of the tablet devices may account for 10 percent to 15 percent of global sales, which will be between 40 million to 50 million units next year, Chief Executive Officer Gianfranco Lanci said yesterday in an interview in Chongqing, China.
Lanci said the push toward tablets is part of the Taipei- based computer maker’s "natural evolution." Selling as many as 7.5 million tablets next year, more than double JPMorgan Chase & Co. projections last month, would help Acer’s shipments challenge those estimated for RIM’s PlayBook and Samsung’s Galaxy Tab.
“The company has talked aggressively about the tablet market but Apple is still very dominating,” said Steven Tseng, an analyst at RBS Asia Ltd. “Aside from price it’s hard to tell what Acer has in their products to differentiate themselves and outperform. If they make cheap models like in the netbook area, they may have success. They’re really good at volume business.”
Still, Tseng rates Acer shares “hold,” partly on concern that new tablet products may not be able to make up for declining sales of netbook computers.
Acer last month unveiled a lineup of three tablet computers -- two devices based on Google Inc.’s Android operating system and one on Microsoft Corp.’s Windows software.
The tablets may be priced between $299 and $599, depending on configuration, screen size and connectivity, Lanci said. The iPad is priced between $499 and $829 in the U.S.
‘Emerging Markets’
Samsung, based in Suwon, South Korea, unveiled its Galaxy Tab in September, and RIM plans to release the 7-inch BlackBerry PlayBook next quarter.
“There is competition and we are set to compete,” Lanci said. “We have strength in designing and developing product. We have strength in terms of channel. We have strength, probably more than other people, in emerging markets.”
Tablets bridge the gap between laptops and smartphones such as RIM’s BlackBerry and Apple’s iPhone. Apple, which showed the appeal of such devices by selling 3 million iPads in the first 80 days after the product debuted in April, accounted for 95 percent of the tablet market last quarter, according to Strategy Analytics.
Apple Chief Executive Officer Steve Jobs in October said that devices such as the PlayBook are “dead on arrival” because they are too small to compete with the iPad, which has a 9.7-inch screen.
‘User Needs’
Lanci dismissed Jobs’ comment, saying there is room for both sizes.
“It depends on user needs,” Lanci said. “While a 10-inch tablet is a very good solution at home or in the office, seven inches can be a very good solution for people traveling or with different needs, even replacing e-books.”
Acer will start delivering its tablets in the first quarter from existing plants in and around Shanghai, Lanci said. Production of the devices may shift to a plant in Chongqing, which is part of the $150 million investment in the city that Acer and the municipal government agreed on yesterday, Lanci said. The new facility will start operations in the third quarter, he said.
The Chongqing plant will have the capacity to produce 30 million to 40 million notebooks or netbook computers annually, and will also manufacture smartphones and tablets, Lanci said. The factory will help Acer almost double the portion of sales it gets in China to 25 percent of revenue within three years, from more than 10 percent projected for next year, he said.
Won’t Kill Netbooks
China will likely overtake the U.S. as the world’s largest computer market within three years, Lanci said. Acer had 13 percent share of the global PC market in the third quarter, ranking it second after Hewlett-Packard Co., according to IDC.
Lanci said growth of tablet computer sales won’t kill the company’s netbook business.
“We don’t see the netbook market dying or declining, except in the U.S.,” Lanci said. “For netbooks outside the U.S. we still see very good growth. The two segments, we are convinced, will coexist together. We see tablets as another opportunity to grow the PC market in the future, not tablets as replacing other devices.”
--Edmond Lococo. Editors: Suresh Seshadri, Young-Sam Cho
To contact the reporter on this story: Edmond Lococo in Beijing at elococo@bloomberg.net
To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net
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Dec. 2 (Bloomberg) -- Acer Inc., the world’s second-largest computer maker, aims to capture 15 percent of the tablet market next year, vying against Research In Motion Ltd. and Samsung Electronics Co. to offer the most popular alternative to Apple Inc.’s iPad.
Acer’s shipments of the tablet devices may account for 10 percent to 15 percent of global sales, which will be between 40 million to 50 million units next year, Chief Executive Officer Gianfranco Lanci said yesterday in an interview in Chongqing, China.
Lanci said the push toward tablets is part of the Taipei- based computer maker’s "natural evolution." Selling as many as 7.5 million tablets next year, more than double JPMorgan Chase & Co. projections last month, would help Acer’s shipments challenge those estimated for RIM’s PlayBook and Samsung’s Galaxy Tab.
“The company has talked aggressively about the tablet market but Apple is still very dominating,” said Steven Tseng, an analyst at RBS Asia Ltd. “Aside from price it’s hard to tell what Acer has in their products to differentiate themselves and outperform. If they make cheap models like in the netbook area, they may have success. They’re really good at volume business.”
Still, Tseng rates Acer shares “hold,” partly on concern that new tablet products may not be able to make up for declining sales of netbook computers.
Acer last month unveiled a lineup of three tablet computers -- two devices based on Google Inc.’s Android operating system and one on Microsoft Corp.’s Windows software.
The tablets may be priced between $299 and $599, depending on configuration, screen size and connectivity, Lanci said. The iPad is priced between $499 and $829 in the U.S.
‘Emerging Markets’
Samsung, based in Suwon, South Korea, unveiled its Galaxy Tab in September, and RIM plans to release the 7-inch BlackBerry PlayBook next quarter.
“There is competition and we are set to compete,” Lanci said. “We have strength in designing and developing product. We have strength in terms of channel. We have strength, probably more than other people, in emerging markets.”
Tablets bridge the gap between laptops and smartphones such as RIM’s BlackBerry and Apple’s iPhone. Apple, which showed the appeal of such devices by selling 3 million iPads in the first 80 days after the product debuted in April, accounted for 95 percent of the tablet market last quarter, according to Strategy Analytics.
Apple Chief Executive Officer Steve Jobs in October said that devices such as the PlayBook are “dead on arrival” because they are too small to compete with the iPad, which has a 9.7-inch screen.
‘User Needs’
Lanci dismissed Jobs’ comment, saying there is room for both sizes.
“It depends on user needs,” Lanci said. “While a 10-inch tablet is a very good solution at home or in the office, seven inches can be a very good solution for people traveling or with different needs, even replacing e-books.”
Acer will start delivering its tablets in the first quarter from existing plants in and around Shanghai, Lanci said. Production of the devices may shift to a plant in Chongqing, which is part of the $150 million investment in the city that Acer and the municipal government agreed on yesterday, Lanci said. The new facility will start operations in the third quarter, he said.
The Chongqing plant will have the capacity to produce 30 million to 40 million notebooks or netbook computers annually, and will also manufacture smartphones and tablets, Lanci said. The factory will help Acer almost double the portion of sales it gets in China to 25 percent of revenue within three years, from more than 10 percent projected for next year, he said.
Won’t Kill Netbooks
China will likely overtake the U.S. as the world’s largest computer market within three years, Lanci said. Acer had 13 percent share of the global PC market in the third quarter, ranking it second after Hewlett-Packard Co., according to IDC.
Lanci said growth of tablet computer sales won’t kill the company’s netbook business.
“We don’t see the netbook market dying or declining, except in the U.S.,” Lanci said. “For netbooks outside the U.S. we still see very good growth. The two segments, we are convinced, will coexist together. We see tablets as another opportunity to grow the PC market in the future, not tablets as replacing other devices.”
--Edmond Lococo. Editors: Suresh Seshadri, Young-Sam Cho
To contact the reporter on this story: Edmond Lococo in Beijing at elococo@bloomberg.net
To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net
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