Dubbed the world’s second-largest computer trade show, Computex Taipei wound up yesterday with a significant increase in visitor numbers. Altogether, there were 120,000 visitors, including 35,017 foreign buyers. There was also an impressive 15 percent increase from last year in total procurement to US$23 billion during this year’s show.
What made this year’s show different from last year’s was that buyers from developed markets returned to source materials from Taiwan, an indication that their economies have recovered from the global downturn. At last year’s event, buyers from emerging markets accounted for about 30 percent of total buyers and helped to compensate for a decline in attendees from other countries because of the economic crisis.
Like the previous shows, this year’s Computex featured many novel computer products and peripheral products, with the hot topics being tablet PCs, e-book readers, 3D TVs and touch-panel displays. The slew of new tablet offerings by Taiwanese companies, following in the steps of Apple Inc’s recent introduction of the iPad, has raised questions as to how soon it will be before this new device eats into the netbook computer market.
Many global high-tech heavyweights attended Computex this year and even made important business announcements during the event, demonstrating their recognition of the importance of this annual industry gathering.
However, apart from the tablet devices, there were fewer killer applications or product surprises at Computex than had been unveiled at Germany’s CeBIT show earlier this year. While both Acer Inc and Asustek Computer Inc, to name just two, introduced their latest gadgets during the show, their efforts to gain visitors’ attention were less powerful than when Asustek launched its first-ever low-price netbook, the Eee PC, two years ago.
In other words, many quality products were on display at Computex this year, but the overall effect suggested that Taiwanese companies have an advantage in manufacturing and adding value to current products, but are less adept at creating new, high-risk applications.
The lack of new products is a result of low investment in R&D and a lack of key technologies. This lower investment in R&D reflects the situation of many companies in an industry where product life-cycles are becoming shorter and where profit margins are falling fast because of fierce competition.
Therefore, the announcement by Foxconn Technology Group that it will raise salaries by 30 percent for workers in China after a spate of worker suicides at its Shenzhen plant — some of which occurred during the Computex show — has not just prompted speculation that it might set a precedent for other Taiwanese companies operating in China, but also raises the question of whether the issue would encourage Taiwanese businesses to start reviewing their strategies of low-margin, contract manufacturing operations.
On a positive note, some Taiwanese companies — contract PC makers in particular — had exhibition booths and VIP rooms at the show to demonstrate their cloud computing technologies on non-computer products.
While no one can be sure that the era of the traditional PC is over as the tablet grows in popularity along with other mobile Internet devices, there are companies starting to sense new business opportunities in cloud computing. While it could help them expand their profit margins, this move also hints at a possible change in the business strategy of Taiwanese computer makers, albeit a slow one.
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