I spent a few days in Taiwan recently for Acer's 20th anniversary celebrations. This company is bigger than most of us realise, having just hit number one exporter in that country. It's more than one company, with divisions producing computers, monitors, CD drives and RAM, to name just a few.
One of the reasons we don't always recognise how big it is is indicated by the fact that while Acer is the world's seventh largest PC brand, Acer is the fifth largest producer of PCs. That's because it's such a large producer of OEM equipment. While we were being shown through one of the factories there were Hitachi and ICL/Fujitsu monitors, Agfa scanners and Hitachi PCs rolling off the lines.
One interesting way that the Acer group works is that each division buys from others on an open market basis. That is, if the PC company can buy CD drives at a better price or for better quality elsewhere, it will, bypassing Acer's own factory. Likewise, Acer in each market around the world strikes its own buying conditions, and may well engage in a bit of product shifting between countries when this is cheaper or more convenient than ordering direct from the factory.
Acer is at the beginning of a huge push into consumer electronics products, with PCs that look more like kitchen appliances, wide-screen TVs that incorporate PC features, mobile phones and kids computers for just a couple of hundred dollars. On the surface this might seem to indicate a shift in direction for Acer, but when you realise it is also predicting huge increases in its server, networking and other high-end products you realise that this new focus doesn't have to mean abandoning traditional markets.
The company has already reacted to the upcoming Network Computer by launching a similarly priced basic PC with Zip drive instead of hard drive. Acer Australia is unconvinced that this will be of any interest to the Australian marketplace. One application that springs to mind is to use these as inexpensive Internet terminals in education. At less than half the price of a traditional PC they make sense. But, of course, things move quickly in this industry, and by the time Acer would be ready to sell them at the end of the year, who knows what else will be on the market or what a traditional PC will cost?