Retail pushes by Dell, Acer breathe life into U.S. PC market
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Growth of PC shipments in the U.S. nearly doubles at the end of 2007 due to the expansion into brick-and-mortar stores.
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(InfoWorld) - Acer Inc. executed a master stroke in the global war for PC market share withÂ its US$710 million purchase of Gateway Inc., but it may take a while for the market to see the light. Industry researchers view the deal as a long term positive, saying it not only strengthens Acer's ability to challenge Hewlett-Packard Co. and Dell Inc. for U.S. market share, but that it alsoÂ blocked a potent rival, Lenovo Group Ltd., from gaining ground in Europe. Even Sun-tzu, the ancient Chinese war strategist who wrote "The Art of War," could not have achieved a better move, wrote J.P. Gownder, consumer PC analyst at Forrester Research, in a report. "Acer strategists calculated several moves ahead in the global PC chess game. If the execution is solid, this deal will create a powerful third-place PC competitor that will challenge HP and Dell by 2009, and portends the rise of non-Japanese Asian PC superpowers," he wrote. But in the near term, stock market analysts and investors couldn't have disagreed more. Almost in unison, they criticized the deal as too expensive, too complex and unnecessary for Acer's growth. "The premium paid to Gateway may be too high, and the execution risk of a multiple-brand strategy is clearly the key here," said Vincent Chen, PC industry analyst at CLSA Asia-Pacific Markets in Taipei. The negative comments hurt Acer's stock. The shares fell 10.6 percent this week to end at NT$57.9 (US$1.75) Friday on the Taiwan Stock Exchange. But the view of the financial sector may be short sighted. Analysts at industry researchers such as Forrester, IDC and Current Analysis West take a longer-term perspective on the deal. Acer and Gateway may lose some market share immediately following the merger, which is normal, according to Richard Shim, an analyst at IDC. But over the long term the deal will give it the size and clout to gain market share and source components. "The opportunity for Acer in acquiring Gateway is the consumer market segment and particularly the retail channel," he wrote in a report. "The acquisition of Gateway will not necessarily position Acer to be a competitor on the level of Dell and HP but it lays the ground work for Acer to be a more significant player in the largest market in the world [the U.S.] and in the fastest growing segment of that market." Current Analysis West analyst Toni Duboise believes Acer could triple its U.S. market share with the addition of Gateway-branded desktops and notebooks, and eMachines' value PCs. The impact of the deal will take months, even years to ripple through the market, analysts say. Not only did Acer add significantly to its size,Â it also stopped Lenovo from increasing its presence in Europe. Lenovo had been in talks to buy Packard Bell BV, but by picking up Gateway, Acer was able to block the deal. Gateway held the right to refuse any deal to buy Packard Bell and make its own offer due to an older contract between the two companies. Stock market analysts argue that buying Packard Bell is a waste of time for Acer because the company is already strong in Europe. But industry researchers, and Forrester in particular, argue the move staved off a Lenovo ploy that might have hurt Acer in Europe. To be sure, merging companies isn't easy. Acer's ability to join company cultures, keep valuable workers and create product strategies that make sense will be the key to the success of the deal. The company has many recent examples to learn from, most notably HP's purchase of Compaq and the sale of IBM Corp.'s PC division to Lenovo. Rob Enderle, industry analyst at the Enderle Group, warns that Acer needs to make sure it keeps people from Gateway with experience in acquisitions, such as those who worked to make eMachines a part of Gateway after that deal. "This is also an ideal time to take a look at all of the technology both companies are using, both HP and Lenovo waited until late to get rid of a lot of the out-of-date operational technology the companies were using and that hurt both a lot. Particularly in the case of HP and the PC Company side of Lenovo, updating the core operations technology was critical to the success both firms are experiencing now," Enderle said. Time will tell if Acer can execute its merger strategy as well as its battle plan for the global PC market. Â
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Taiwan&#39;s Acer Inc will buy  Gateway Inc for $710 million to double its U.S. presence and  unseat China&#39;s Lenovo as the world&#39;s No. 3 PC maker, while  dealing a blow to its efforts to grow in Europe.
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Acer is showing strength in the global PC industry, becoming the world's third largest PC maker in the first quarter of 2007, according to data from research firm iSuppli.
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Retailer will begin offering Gateway notebook and desktop PCs next month.
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(InfoWorld) - Taiwanese PC vendor Acer Inc. has started selling laptop PCs at popular retailer Best Buy Co. Inc., expanding its presence in the U.S. market. Best Buy is featuring Acer laptop PCs with a brand spotlight notice on its Web site. All five of the Acer laptop PCs on offer at Best Buy are priced under US$900. The most expensive of the five is the Acer Aspire AS5610-4537, which runs on an Intel Corp. Core Duo processor. It costs $849.99. The lowest-priced Acer laptop at Best Buy is the Aspire 420 notebook, AS3680-2022, which runs on an Intel Celeron M and retails for $499.99. According to the Web site, the notebook is already sold out. A similar Aspire 420, the AS3690-2710, runs for $699.99 with a larger, 15.4-inch screen. Acer has targeted the U.S. and China as two major potential growth markets for the company, and has invested more resources into the two countries over the past few years. Acer is the world's fourth largest PC vendor by revenue and the fastest growing PC vendor in the world among the top 10.
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Dell's retail strategy is paying off in the U.S., but HP is still the biggest PC vendor worldwide.
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(InfoWorld) - Dell is seeing strong demand for its products in several Asian markets and is pleased with customer acceptance of Microsoft'sÂ new Windows Vista operating system, according to one of the computer manufacturer's senior executives in the region. While Dell's business in China and South Korea is growing at more than 30 percent year-over-year, it growth in India is even greater at 60 percent, said Jim Merritt, vice president of North Asia operations at Dell and president of the company's Japan unit. The growth hasn't been typical worldwide, however, where Dell has beenÂ battling a slowdown. The company's plan to revive its business depends partly on reaching more customers in emerging markets, particularly those mentioned by Merritt. The plan also looks toÂ focus on SMBs, enterprise services, and storage, and to shorten the amount of time it takes to design new products. In Japan, growth is more modest but still good at between 10 percent and 12 percent, according to Merritt. Dell Japan will be focusing on enterprise customers, services, software, and peripherals as it looks to grow market share in the traditionally tough market where Japanese hardware and software vendors dominate, he said. On the consumer side of the business, customer reaction to Windows Vista as been "good overall," said Walt Mayo, corporate director of Dell Japan's home and business sales division. "In Japan, the last quarter was very soft," he said. "Dell did quite well and we think [the softness] was due to consumers waiting for Vista." Last week, Dell reported profits of $673 million for its fourth quarter, which runs from December to February. The numbers, which are provisional, are sharply lower than the $1 billion it made in the same period a year earlier. Revenue was also lower. It fell to $14.9 billion from $15.2 billion in the same period a year earlier. The company has reported only provisional earnings for the last three quarters due to an ongoing investigation by the U.S. Securities and Exchange Commission and the U.S. Attorney for the Southern District of New York into its accounting practices, it said. In January,Â Kevin Rollins resignedÂ as Dell's CEO and Michael Dell came back to the position. Merritt said he thinks Dell's return to the company that bears his name will help "reinvigorate Dell and bring a fresh approach." Â
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The start-up delivers its pocket-size PC to U.S. shelves.
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PC maker Gateway Inc. said on Sunday its new line of notebooks, desktop personal computers and monitors aimed at retail markets will be available at Micro Center's 20 stores in the United States.
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Direct sales aren't working the same magic they once did for the PC maker. Can it now cash in at retail?
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Dell raced further ahead of rival Hewlett-Packard in the worldwide PC market during the third quarter, according to new research. In separate reports released on Monday, Gartner and IDC both found that the
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By THERESE POLETTI  Responding to the drubbing it has received from rival Hewlett- Packard in the consumer personal computer market, Dell announced a major shift in its strategy with plans to begin selling desktop PCs in Wal-Mart stores.
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TAIPEI/SHANGHAI  - Taiwan's Acer Inc   will buy Gateway Inc  for $710 million to double its  U.S. presence and unseat China's Lenovo  as the  world's No. 3 PC maker, while dealing a blow to its efforts to  grow in Europe.
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At CES 2008 next week, manufacturers won't be showing off hot new desktops; instead, sleek new notebooks will take center stage. In the United States, notebooks are already outpacing desktop PC sales by a small margin and it won't be much longer before the rest of the world catches up.
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Offering a stark counterpoint to rival Hewlett-Packard Co., Dell Inc. (DELL) reported a nearly 30 percent jump in net income as strong sales of printers, servers and notched double-digit gains in overseas markets...
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The PC market, long declared dead by some, grew in double-digit figures again in 2004. Dell expands lead as HP slips.