Mon, Feb 25, 2013 - Page 13 News List

Asustek, Acer tout phones, tablets

TRANSFORMATION:Traditional PC products are losing ground to mobile devices which perform better in terms of portability and media experience, an expert said

By Helen Ku  /  Staff reporter

A man walks past an entrance of the Mobile World Congress in Barcelona, Spain, on Saturday.

Photo: Reuters

Taiwanese notebook makers Asustek Computer Inc (華碩) and Acer Inc (宏碁) are today to showcase new products at the Mobile World Congress (MWC) in Barcelona, Spain, but this year, the laptop vendors plan to bring their new tablet and smartphone products to the table, rather than notebooks, as demand for mobile devices increases.

“The congress has become an important battlefield tech companies don’t want to miss. It’s everyone’s time to shine,” Taipei-based Fubon Securities Co (富邦證券) equity analyst Arthur Liao (廖顯毅) told the Taipei Times yesterday on the telephone.

This year, the four day event features the theme “The New Mobile Horizon.” Asustek is expected to introduce a new 7-inch 2-in-1 tablet named the FonePad to take on Samsung Electronics Co’s new Samsung Galaxy Note 8 tablet.

Meanwhile, Acer last week announced it was poised to unveil a new smartphone product lineup, called the Liquid series, at the congress, continuing its product strategy adjustment as it seeks to transform from a major notebook vendor into a computer hardware manufacturer making laptops, as well as handheld gadgets, amid dynamic markets.

“Asustek has been ambitiously seeking to develop computers in addition to notebooks to compete against other tech companies in the PC industry. Last year’s expansion in terms of annual sales proved the company had successfully transformed itself, which is crucial to every tech firm trying to survive in the market,” Liao said.

Citing Hewlett-Packard Co’s (HP) earnings report, in which the US company reported a 4 percent drop in sales of both notebooks and desktops last quarter, and also Dell Inc’s recent buyout plan, Liao said the traditional PC products were no longer in demand and would gradually lose ground to mobile devices, which can perform better in terms of communication, portability and media experience.

“The new trend is clearly taking shape. We’ve entered an era of ‘cloud computing,’” he said.

Liao said he was not “particularly excited” by Asustek’s new tablet product because the device is equipped with Intel Corp’s Atom processor, which is less power-efficient compared with ARM Holdings PLC’s RISC-based computer processors.

Liao said Acer’s new Android smartphone lineup might stir up the market’s attention, but overall, “there is a long way to go for Acer [to improve its profitability],” adding that though the Taipei-based company has set a new product strategy and plans to launch more mid and low-cost tablets and smartphones this year to increase sales, the quality of budget handheld devices remains a key point that it cannot guarantee to customers.

Liao forecast Asustek’s notebook shipments would drop 13.56 percent from 5.9 million units last quarter to 5.1 million units this quarter. Acer’s notebook shipment is expected to shrink 9.43 percent from 5.3 million units last quarter to 4.8 million units this quarter.

Sales of laptops are forecast to contract by between 10 percent and 15 percent for the two companies this quarter, Liao said.

He added that total sales for Acer are expected to shrink between 15 percent and 20 percent this quarter, and between 10 percent and 20 percent for Asustek, citing the first quarter of a year is a traditional off-peak season.

For the whole year, Fubon forecast Asustek’s revenue would hit a record high level of NT$460 billion from about NT$410 billion estimated for last year, with earnings per share of NT$33.3.

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