Global PC giant Hewlett-Packard Co’s (HP) plan to spin off its personal computer business would affect Taiwan’s PC supply chain, the Ministry of Economic Affairs (MOEA) said in a preliminary analysis, adding that the nation needs to further integrate smartphone production, cloud computing and digital convergence to stay globally competitive.
In a statement issued late on Monday, the ministry said Taiwanese supply-chain and contract PC companies have important roles in the global PC industry and they would bear the brunt of HP’s decision.
“But the real scenario remains uncertain, since the US firm expects the move to be completed within 12 to 18 months,” it said.
The statement came after a meeting of the Industrial Development Bureau, the government-funded Institute for Information Industry (資策會) and think tanks.
The analysis forecast three scenarios: HP will spin off the business into a separate company; HP will sell the business to a PC vendor in South Korea, China or the US; or HP will sell the business to a non-PC vendor in the US.
Other than tracking developments with HP, the ministry said it would also accelerate the pace of integrating the nation’s smart handset, cloud computing and digital convergence sectors.
However, analysts expressed mixed views about the impact of HP’s decision.
Goldman Sachs analysts led by Henry King (金文衡) said in a report yesterday that the move would be positive for HP’s competitors, such as Lenovo Group Ltd (聯想集團) and Asustek Computer Inc (華碩電腦), but negative for HP’s suppliers, such as original design manufacturers (ODM) and electronics manufacturing service partners.
Morgan Stanley analyst Grace Chen (陳星嘉) said although supplier relationships would not change in the near term, HP’s potential market share loss might translate into shipment shortfalls for its suppliers, including Inventec Co (英業達) and Hon Hai Precision Industry Co (鴻海精密).
Acer Inc (宏碁) would also benefit less compared with other PC brands because of its own restructuring, Chen added.
DRAMeXchange Technology Inc (集邦科技), a Taipei-based research institute, said HP’s sale of its PC business would not affect Taiwanese notebook ODM businesses as a whole because the cooperative system between brand vendors and ODMs has been established for years.
“Regardless of the final buyer, be it Samsung Electronics [Co,] Lenovo, Dell [Inc] or other notebook manufacturers, they will most likely outsource their production orders to Taiwanese ODMs,” the institute said.
In the long run, HP’s decision will change the dynamic between Taiwanese notebook ODMs and affect the global PC ODM industry, it added.