by CIO Staff

Acer: PC Industry to Rebound After June

Jun 05, 20063 mins
Computers and Peripherals

Executives at some of the PC industry’s biggest players have been working together to figure out a way to stimulate growth in the PC market, an effort that should stoke a gradual rebound by the end of the month, Acer’s chairman said on Monday.

Sales in the industry hit a slow spot earlier this year, forcing companies to retrench and look for new ways to attract buyers. Some of the measures being discussed are working, and the industry should “gradually pick up” at the end of June, said J.T. Wang, Acer’s chairman, who spoke to reporters at Computex.

Those involved in the discussions, which may have been quite informal, include Acer, Microsoft and Intel, he said.

He declined to be specific about the measures discussed, although cutting prices for PCs appears to be among those that have emerged. Even as the industry players work together to arrive at broad strategies for growth, increased competition among them means they are reluctant to discuss their own specific plans in detail.

Competition has increased after some top PC vendors reported weaker-than-expected earnings during the first three months of this year, and amid signs their growth is slowing. Dell and Lenovo Group have been growing at a slower pace than Hewlett-Packard and Acer, according to figures from the first quarter of this year by market researcher Gartner.

The companies have started slashing prices in a bid to regain market share, which should benefit users. But users have still slowed their purchases despite the lower prices, analysts say.

Part of the problem is the delayed launch of Microsoft’s latest OS, Windows Vista. Many users plan to wait until it’s ready before buying a new PC. Another factor is that many people are delaying a purchase because they expect PC prices to fall as Intel and Advanced Micro Devices battle for market share in microprocessors, one of the most expensive parts of a PC. If the two companies start slashing prices, users should see PC prices drop as well.

Dell remained the top PC vendor by volume in the first three months of this year, but its growth rate was just 10.2 percent, its weakest performance since the third quarter of 2001 and far worse than rival HP, which posted shipment growth of 22.5 percent, according to Gartner.

Lenovo ranked third in global shipments, Acer fourth and Fujitsu fifth.

-Dan Nystedt, IDG News Service

For related news coverage, read Acer Revs Up Dual-Core Ferrari Laptops.

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