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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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RE: No one competes with Apple
By TakinYourPoints on 8/7/2012 4:32:16 PM , Rating: 0
There's that, plus they're the fastest tablets with the best displays and most high quality apps. A new Android tablet is slower than an iPad 2 from a year and a half ago.

I know these logical and quantifiable facts are "fairy dust" to the hivemind here, but there it is.

RE: No one competes with Apple
By gsleon3 on 8/7/2012 4:53:58 PM , Rating: 5
LOL...Android HAS had tablet apps for quite some time. It has just recently been that the actually now call them tablet versions. Android apps can be developed to format to any resolution or layout therefore making "tablet apps" unnecessary. As for faster, meh....I have had both & it depends on what you mean by faster. I know that java script & flash website issues that plague Apple are not an issue for my Nexus 7. Android is already at LTE & nearing dual band wireless-n capability. Many already let you chose between the 2.4Ghz & the typically less cluttered 5.0Ghz wireless-n frequency, which is great when streaming an HD video to my 70" LED. For the folks that claim they "Invented" the modern smartphone, they sure haven't done much with it since then. The amount of development & innovation from 1st gen Android to the S3 or One X is amazing. I had several iDevices & they were great, but Android just offers more & more than anything I love having a plethora of options for content, not just iTunes.

RE: No one competes with Apple
By robinthakur on 8/8/2012 5:29:45 AM , Rating: 2
Yer I really miss dragging and dropping all my content to a slow memory card and using unreliable 'sync' software like iSyncr, DoubleTwist and the rest. More than anything, I miss the time when remotes didn't work reliably on my phone and I have to change tracks on the device manually. So much innovation. Android has come on in leaps and bounds, but they still don't make the devices easy enough to use. I'm a developer and gave up on the S3 eventually due to the above lack of progress, not sure how anyone less technical would work it out. Yes it can wirelessly share photos I take with everybody around me (might be useful in Korea, but otherwise one of the numerous pointless features nobody will ever use) but if you can't even get MP3 playback right, give up. Maybe it works better on the HTC X, but the S3 is shambolic at that assuming you don't just buy phones to tinker with and endlessly reflash custom roms.

By TakinYourPoints on 8/8/2012 6:19:34 AM , Rating: 1
Android tablets have nothing like the developer ecosystem that iOS does, nor is it as profitable as the iOS platform. The difference in quantity, depth, and quality in tablet apps between them is massive.

Android apps can be developed to format to any resolution or layout therefore making "tablet apps" unnecessary.

Nonsense, I've used those non-tablet optimized apps on Android and it is second rate in every way. Compare something like the Yelp or Twitter apps on Android tablets versus the iPad, night and day difference in usability because the UI was made for a big touchscreen.

What you advocate is like saying that a mobile web page should be good enough for the desktop browser on my 27" desktop PC display. After all, it'll just scale to fill the window, right?

What you describe is a halfass solution in the real world.

As for LTE, I don't know why you brought that up, 4G LTE on the iPad is really fast. I tested 10/10 download/upload on it, an even faster upload speed than the 5Mbps I get on my cable.

As for performance, Anand posted newer GPU benchmarks:

As I said, an iPad 2 from early 2011 still performs better than the latest Android tablet hardware. Don't take it out on Apple, take it out on NVIDIA for dropping the ball on their SOCs.

RE: No one competes with Apple
By StevoLincolnite on 8/7/2012 7:51:29 PM , Rating: 2
I know these logical and quantifiable facts are "fairy dust" to the hivemind here, but there it is.

But it is fairy dust.
The iPad 2 was never the fastest tablet even upon release, my convertible netbook/tablet is faster and that has an Intel Atom processor and can handle 1080P video playback just fine. (Thanks to a Broadcom Crystal HD chip!)

Then when surface arrives, suddenly Tablets will be running with Ivy Bridge processors, the Arm based processor that the iPad uses is competitive to the Atom, but no way will it touch Ivy Bridge.
Plus a Windows 8 tablet can do actual real work due a full featured OS (Unless it's the RT), real keyboard and a decent processor.

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