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Sunday, May 17, 1998

Acer Computer International to double ad budget 

Our Corporate Bureau  
Pune, May 16: Acer Computer International, which has recently begun marketing its products under the Acer brand name, will double its advertising budget in the country.

ACL managing director York Chen said the efforts to push its international brand is a result of Acer's belief that its joint venture with Wipro Corporation, Wipro Acer Ltd, has been "very low key, which is not good for brand name building."

This is not a prelude to any change in the structure of the 45:55 joint venture in which Acer is the minority stake holder or marketing and promotional effort.

Chen said their experience has shown that the jointly branded product, Wipro Acer, lost out on the large domestic as well as on the high-end, multi-national market segment. Now, with the separation, Wipro products would target the indigenously manufactured segment while Acer would compete in the MNC segment.

Chen said it was Acer's global policy to set up joint ventures in which it holds a minority stake but markets the product under the Acerbrand. India had been the sole exception to this policy, which has now changed.

With a domestic personal computer market slated to grow 30 per cent, India will be the focus for the firm's growth. The slump in the south-east Asian countries, following the currency crisis, has resulted in shifting Acer's focus away from that region. These markets are likely to stagnate for the next few years while India is expected to maintain an annual growth rate of 30 per cent for the next several years. The demand for PCs in the Indonesian market had dropped by 50 per cent, Thailand by 35 per cent, Malaysia and the Phillipines by 15 per cent and South Korea by 10 per cent.

Globally, Acer intends to increase its presence in the software segment as well, so that in ten year's time, its contribution to group profits would be one-third of the total. At present, it has a negligible contribution in the total revenue of $6.5 billion. The focus will be on software that will enhance hardware performance, integrating Acer'sexisting hardware expertise. Acer had recently announced its proposed take over of Siemens Nixdorf's manufacturing facility in Augsburg, Germany.

Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.

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