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Unable to compete, OEM bemoans Microsoft decision to step up

Like King Theoden of The Lord of the Rings, Microsoft Corp. (MSFT), old and gray, watched as Apple, Inc.’s (AAPL) tablets, which were increasingly cannibalizing users' screen time, imperiled its kingdom.  Like the king, Microsoft's advisors whispered false promises of security.  Any day now a successful Windows tablet would come out...

Except it didn't.  So Microsoft, at last awoken, took up the sword unveiling the Surface -- a slick Windows 8 tablet that shocked the tech world.

Now its finding that some of its former allies have taken its awakening quite badly.  Among those is Acer, Inc. (TPE:2353).

Acer played the role of Wormtongue to Microsoft's Theoden, ever lofting big promises in the tablet space, and ever falling behind Apple misstep by misstep.  Now the company hisses at its former ally for taking matters into its own hands.

Comments JT Wang, chairman and chief executive of Acer, in an interview with The Financial Times, "We have said [to Microsoft] think it over.  Think twice. It will create a huge negative impact for the ecosystem and other brands may take a negative reaction. It is not something you are good at so please think twice."

Campbell Kan, Acer’s president for personal computer global operations, adds a not-so-subtle threat, suggesting, "If Microsoft … is going to do hardware business, what should we do? Should we still rely on Microsoft, or should we find other alternatives?"

Microsoft in regulatory filings has acknowledged that its OEMs may be hurt by Surface.  But the key thing to note is that the whole reason that Microsoft entered this face was because its partners failed, miserably, to compete against Apple.



Acer's sour grapes are perhaps a testament to the overall weakness of its tablet line.  J.T. Wang in Dec. 2011 called his company's product's "cheap" and "unprofitable".  Samsung Electronics Comp., Ltd. (KSC:005930) and others have outsold Acer in the emerging Android tablet market.

Even if Microsoft's Surface proves successful, volumes will likely remain relatively low, by Microsoft's own accounting.  Thus companies like Samsung who have promising Windows 8 tablet products should be fine.  

For companies like Acer, who lack viable tablet product of any flavor, there will likely be much bellyaching.  But at the end of the day they forced Microsoft to make this decision in the first place, and if they focused on creating viable products rather than making hollow threats, then they would have far less to worry about.

Source: Financial Times



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Acer USA products
By Gunbuster on 8/7/2012 3:29:38 PM , Rating: 1
Let’s analyze the Acer USA landing page shall we?

1: Lead with an 1366X768 Ultrabook. Bonus, nothing says ultra like a fuzzy bunny on fire breaking through your screen

2: Next in the image carousel (THAT. YOU. CANT. STOP. from rotating) is an android tablet that looks exactly like the HP Touchpad: Fail

3: Cloud something high school/college grad theme. Acer phone (Laugh), Ultrabook, Tablet: Boring and a total laugh on the phone. I would be surprised if one grad in the entire world ever requested an Acer phone.

4: Some sort of all in one touch screen PC: maybe not shit on Microsoft so much if your #4 featured product is a touch screen PC that will benefit immensely from Windows 8. Special bonus for using an image with prominent euro or asian type electrical receptacles on the US site.

5: A bunch of generic looking tablets one would expect to find for sale on the street in china. Images imply they have a shitty tablet for every member of my family.

6: Acer business products? Servers? HAHAHAHAHAHAHAHAHAH Pathetic.




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