Acer has quickly become one of the biggest computer manufacturers in the global market and is looking forward to expand in other emerging markets. We have managed to put some questions to Walter Deppeler, Senior Corporate Vice President Acer Group and Deputy President Acer EMEA, over how the company will be evolving over the next few years.
1. Could you briefly present Acer as a company?
The Acer Group is a family of four brands -- Acer, Gateway, Packard Bell and eMachines. This unique multi-brand strategy allows each brand to offer a unique set of brand characteristics that targets different customer needs in the global PC market. Today, the Acer Group still strives to break the barriers between people and technology. It ranks No. 2 for total PC shipments and No. 2 for notebooks, and has a global workforce of more than 7,000 employees. Estimated revenues in 2009 reached US$17.9 billion.
2. Acer has grown from a little known tech company in the 1990's to one of the biggest personal computer companies in the world. How did that happened?
For Acer, making the right choice has made all the difference, in the same way as the company's courage to change and take risks without ever losing sight of its final objective and without ever straying from its mission.
The company took an ‘unpopular’ decision to stake everything on mobility and then organized itself to make this decision work: abandoning production activities in favor of Research and Development, specializing in sales & marketing and investing everything on an indirect sales strategy.
Acer focused on marketing its brand-name IT products around the globe. Wielding a profitable and sustainable Channel Business Model (CBM), Acer has been able to achieve sustainable growth worldwide. The model offered - and is still offering - the flexibility to adapt to changing global IT market trends.
We expect the foundation of the CBM shall enable Acer to reach further success, minimize operating expense and enhance profitability. When the going got tough, Acer took yet another courageous decision that would forever change its destiny.
It acquired three companies: eTen allowed Acer to enter the smartphone segment, while Gateway and Packard Bell led to the development of Acer’s multibrand strategy, one that has proven successful in other markets but was unheard of in IT. The result is that the Acer Group is now ranked second worldwide.
3. Speaking of acquisitions, Acer's history has been peppered with some strokes of genius like the purchase of eMachines. Will Acer be willing to go even further?
In this industry, without growing market share in most case it’s not possible to grow at all. And if it’s not possible to grow, a company can’t be profitable.
Integrations process has not come to an end. There is no space in the PC industry for more than 4 or 5 players, because profits are too low. Today, the 70% of the market is in the hands of 5 main players.
Even if we have no plans in the short-term for acquisitions, we can’t rule this out because we should expect a further consolidation of the market.
4. Will Acer be launching non x86 devices like Smartbooks in 2010? How do you think Smartbooks (ARMdroid) and Netbooks (Wintel) will cohabitate in the future?
Our main focus since the beginning has been mobile. And mobile is the segment that will continue to grow even in the downturn. Notebook and netbooks are ‘two-hands’ devices, while smartphones are ‘one-hand’. These devices are extremely different but share a common core: connectivity.
The growing similarities between smartphones and laptops play directly to Acer’s strengths. Acer has the know-how and these two worlds are going to merge.
The evolution of the mobile computing will go through a PC with the same format of a cellphone featured with 4/5 inches displays and the same power processing of a laptop, able to easy connect to the Internet.
5. Acer was the first Taiwanese PC manfuacturer to abandon ODM completely and start to build its branding. What separates Acer now from brands such as Toshiba or Sony?
Unlike its more diverse rivals, Acer directs all its attention toward one goal: selling computers. Such focus has helped Acer establish what analysts regard as the lowest cost structure in the industry.
The company is free to pick and choose among manufacturers to obtain the lowest prices, and prides itself on having almost no inventory. We collect the order from the customer, place the order with the manufacturer and they ship it. We don’t touch the goods.
6. And what about Smartphones? Will you continue supporting Windows Mobile and Android?
We’ve only been in the mobile phone market a year, but we have produced a phone as sophisticated as the Liquid in that time. So we are on a learning curve, but we are ramping up to meet the exciting market conditions.
Acer shipped around 500,000 units in 2009 and is looking to increase that to two to three million units worldwide in 2010 and 10 million in 2011. By 2012 it wants to have 5% to 7% market share.
Acer aims to stick with two operating systems for its smartphones - Microsoft's Windows and Google's Android. The most recent version of Windows is showing promise.
7. Earlier this month, Acer's CEO spoke about the need for the company to expand into the server market; how will that happen?
Consumer is still our No. 1 focus, but it became clear about 18 months ago that the professional market was coming back. We are more serious about going after professionals than before.
In Europe, we established Gateway as the brand dedicated exclusively to the professional world, developing complete, reliable solutions for medium-sized businesses.
Gateway has built its structure around its clients, creating simple, efficient processes that reduce delays and administrative complications to a minimum. It uses a slim-line organization that has the experience and the capacity to make real-time decisions, and is accessible to partners and clients alike.
The winning formula is a perfect combination of ingredients, and Gateway has them all: high added value for this channel; low competition between partners to guarantee higher margins; one of the most simple business models in the industry; capacity for innovation and integration with future technologies; “upper class” services and 100% focus on the medium-sized business segment.
8. Unlike many of your direct competitors, Acer doesn't have an online store for corporate customers. Is the company planning to introduce one anytime soon?
We are looking carefully at this market, but at the present time it [the market for such a solution] is really too young…
9. Acer has aggressively supported Linux on its popular Aspire netbooks. What is Acer's stand when it comes to open source?
The Android OS is part of our strategy. We choose this operating system early 2009, because we want to be ‘open’ to solutions that can simplify users’ life. We are also taking into consideration the adoption of Google Chrome OS, but nothing has been planned yet.
Our Aspire One with Android is more than a netbook - it’s a 360° mobile device. The true revolution of the new Aspire One D250 based on Android is that it brings together the best of two worlds.
It offers the immediacy, the ultrafast connectivity and speed of Android for instant access to web browsing, emails and social interaction together the full and reliable productivity of the Windows environment, with a simple click to switch OS.
10. How do you see Acer by 2013?
We will be number 1 in the global mobility market. That’s our ambitious goal.