Taipei Times: What can you tell us about US cloud-computing technology company iGware? The deal seems expensive, considering -iGware is a small-scale private company. What do you think?
J. T. Wang (王振堂): iGware provides cloud-computing services to Nintendo Inc and it will continue offering its services to the Japanese game console maker after the transaction, which means Acer will have extra revenues of US$120 million from the business with Nintendo over the next four to five years. We put that into consideration when negotiating the acquisition price.
iGware owns reliable cloud-computing technologies and related patents. The company has between 40 and 50 employees, of which two-thirds are senior software engineers with expertise in hardware and software integration and in cloud-computing technology development. They are a valuable asset.
Photo: Maurice Tsai/Bloomberg
Acer has been exploring measures to boost the company’s equity value over the next five to 10 years and the cloud-computing system, Acer Cloud, is one of our core strategies to achieve this goal. We hope to build the system and to roll out the services as soon as possible. As a result, this [acquisition of iGware] will be a short-cut.
Our goal is to build and begin operating the Acer Cloud system as soon as possible and make it good enough to compete with the cloud system built by the closed-source system [Apple’s iCloud].
TT: What are Acer’s strategies to develop its smartphone business?
Wang: Acer’s smartphone business has fallen short of our expectations. We will be selective about investing in the smartphone business, which is part of our recent restructuring plans. We will only sell products, designed for targeted customers, to targeted markets. We do not plan to conquer the whole world.
Smartpones are in a different area from what we are doing now. We are not familiar with the way they are doing businesses. For example, a large portion, or about 80 percent, of smartphones are sold via telecoms operators rather than via the consumer electronics retail chains where we sell PCs.
Tablets are also mostly sold through consumer electronics retail chains. So we will prioritize investment in tablets over investment in smartphones.
TT: Do you think tablet devices will continue nibbling away at netbook computer and standard notebook computer markets?
Wang: I won’t bet on any one of them now, but it is certain that the competition will intensify and push companies to come up with more innovative designs than before. This year, standard notebook shipments will still grow by a single-digit percentage from last year. [Gartner forecast PC shipments would grow 9.3 percent year-on-year to 385 million units this year]. Netbook shipments will drop by 10 percent to 20 percent, while tablets might have strong growth.
But, things will change greatly next year. It is difficult to predict which device will outgrow the -others. Next year, Microsoft is set to launch its new operating system, Windows 8, and there will be ARM-based processors to go with it. I believe [this combination] will bring a lot of new [low-cost] products into the market next year, with designs based on the principle of destructive innovation [ie, products that have attractive applications and carry affordable price tags].
TT: As most market researchers forecast that Apple’s iPad will take up 80 percent of the tablet market this year, do you think non-Apple, or Android, tablets will have the chance to win back some share of the market soon?
Wang: I still have faith in the open-source platform [Android operating system] for tablet devices. Though it will take more time for the hundreds of companies supporting the platform to build an ecosystem, the Android camp will have the power to rock the market after integration.
Take the smartphone as an example. The phone [iPhone] claimed 70 percent, or 80 percent of the market share shortly after its launch, but now Android smartphones have seized twice the market share. [Gartner statistics showed Android-based smartphones accounted for 36 percent of global sales in the first quarter of this year, while iPhones made up 16.8 percent].
The open-source platform has the chance [to win]. It is just a matter of time.
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