Until the recent boom in tablet sales, Acer was one of the companies riding the crest of the wave of high volume, low value laptops. But the consumer electronics market has swung away from that part of the PC market and now the Taiwanese manufacturer is looking at a concerted push into mobile.
It already has four ranges of smart devices but it has been working on phablets and high end smartphones. However, it hasn’t made the decision whether these devices will see the light of day in their current forms. Picking up a phablet, dubbed the Liquid S1, from the table in front of him, ST Liew, president of the smartphone business group, says: ‘The technology is an investment. A lot of what we do will be brought to bear in future products.’
Acer said its concerted push into mobile followed an examination of its business and where consumer trends were heading. Allen Burnes, vice-president for smartphones for Europe, Middle East and Africa, said: ‘It’s pretty clear that the IT business and the smartphone business are colliding. With the deployment of LTE, during the next few years computing will very much be mobile. We recognise it’s essential to be in the smartphone space and we are looking at what assets we could use across our footprint.’
Burnes demurred when asked whether Acer would bring the high volume, low cost success that worked so well for it in laptops to bear in the smartphone space. On the day Mobile met Acer, Vodafone announced its £50 own brand smartphone. Is Acer likely to follow suit and target the increasingly crowded entry level? Not quite, because of the importance of maintaining its brand. Burnes said: ‘We are very careful with what we do. If you look at the specs that go into the Vodafone device, it’s compromised with the likes of memory and speed. We took the conscious decision with the Z1 smartphone that we wouldn’t go below a certain speed and memory.’
White label deals, usually the best way for a new entrant to gain traction, are also off the cards. Burnes says: ‘We have had that discussion but at the end of the day we are not going to build products for a marginal margin and poor branding.’
So the plan is to bring its Liquid S1 phablet to market in August, followed by another phablet at the end of the year. Acer is positioning the handset as a flagship device, but consumers’ heads may be turned by the £349 retail price.
Need for speed
Burnes says one of Acer’s strengths is how quickly it can get devices produced, with its phablet the result of initial conversations in January. Speed may be one thing but competition in the mobile market is a tough nut to crack, as former Motorola man Burnes realises. He says the company is in talks with operators about its forthcoming products but he says it is the company’s brand that will sell devices, not a weighty budget.
He says: ‘We are not Samsung and are able to go out and spend €500m but we can get cut through with aligned marketing. Point of sale is very important. Retailers can be quite conservative but I think this can grab interest among consumers.’
Beyond that, Burnes says the company’s nimble nature means it can experiment that bit more than the larger players. When asked what its plans are for entry level devices, he replies: ‘We shouldn’t think small screen is exclusively entry level. Why shouldn’t it be wearable technology?’ If it can cut into the smartphone market like it did laptops, Acer could be the next big disruptor to be coming out of Taiwan.
Microsoft is ‘not doing enough to drive Windows Phone’
Acer is sticking with Android as the key software on its smartphones. Allen Burnes told Mobile the smartphone business is at such a relatively early stage to its laptops that it needs to be careful where it places its money. Microsoft has made inroads in the UK thanks to the latest version of its operating system but Windows Phone still only accounts for one in 10 smartphone sales.
Burnes said it was ‘very interested’ in Microsoft as an operating system but it needs to make more of an impact. He said: ‘What we look for is consumer pull. As a business we need to take bets. We have to make hard business decisions that have to return or we have wasted the best part of a year.
‘Microsoft has great values but it is not getting these across to the consumer. Through the next year it should grow but it is completely underindexing where it should be.’