Wed, Nov 24, 2004 - Page 10 News List

Shortage could curb laptop sales

CHIP SUPPLY Intel's CPU chipsets for portable computers are in short supply, and this may squeeze local vendors' own-brand shipments

By Amber Chung  /  STAFF REPORTER

The short supply of Intel Corp's central processing unit (CPU) chipsets for portable computers could trim shipments of Taiwanese branded notebook vendors this year, an industry watcher said yesterday.

"There is a shortage of Intel's mobile CPU chipsets for notebooks, with a gap of over 20 percent in meeting market demand," Simon Yang (楊勝帆), a senior researcher at the Topology Research Institute (拓墣產業研究所), said in a phone interview yesterday.

Yang said the CPU shortage has resulted from robust sales of laptops in the fourth quarter, which exceeded Intel's original expectations. Intel's products power over 90 percent of laptops worldwide.

In the third quarter, Intel reportedly cut prices of its processors used in desktop computers by as much as 35 percent to help reduce inventory and stimulate buying before students returned to school in September.

But the chip giant turned conservative on the market for the last quarter, due to slow after-school sales late in the third quarter, Yang said.

The global laptop market has grown by about 17 percent so far in the fourth quarter from the previous quarter, and Taiwan's notebook market growth jumped by 30 percent over the same time, according to statistics by the Taipei-based research house.

Compared to global laptop brands, smaller local vendors, including Acer Inc and Asustek Computer Inc (華碩), which have less leverage to secure sustained chipset supply amid jitters over a deficiency in key components, are likely to see annual shipments slide by around 10 percent, Yang said.

Acer, the No. 5 player in the sector worldwide, originally hoped to ship 3.2 million notebooks this year, while Asustek, whose own-brand products make up half of its annual laptop shipment, expected to deliver around 2.8 million units, according to Topology.

Acer's president Wang Jen-tang (王振堂) told investors earlier this month that Intel's shortage could cast a shadow over the company's brisk sales in the quarter ending December.

Smaller rival Asustek, however, did not seem to be bothered by the problem.

"As we have a smaller branded laptop shipment, the shortage is not expected to affect us," said David Chang (張偉明), chief special assistant to Asustek's chief executive officer.

The company's delivery of contract-manufactured products would remain intact, as the issue will not impact clients, such as Apple Computer Inc, Chang said.

In spite of Asustek's optimism, the short supply of CPU chipsets could trim the nation's total laptop shipment for this year to 31 million units from the previous forecast of 32.4 million, Yang said.

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