The PC industry has been in a whirlwind this year. Dell (NASDAQ: DELL) emerged from a long accounting scandal to find it not making a huge amount of progress on PC industry leader Hewlett-Packard (NYSE: HPQ), and Acer gobbled up Gateway to make it the world's third-largest PC company behind leader HP and follower Dell (and slightly ahead of Chinese company Lenovo). Now that Taiwan-based Acer has completed its acquisition of the Gateway brand for a little over $700 million (a bargain, all things considered), Gateway's CEO, Ed Coleman, has announced he will be leaving the company. After a year of disastrous results, most industry watchers saw this one coming, I believe. Coleman says he'll leave at the end of January, to be replaced by Acer's president for Pan American sales, Rudi Schmidleithner, who will be in charge of the official integration of both companies.
Can Acer take the Gateway brand and return it to prominence in the PC market by the sheer force of market share alone? After all, HP is definitely not sitting still and Dell's recent moves into more consumer-friendly PC products and its huge push into retail (Wal-Mart, Staples and Best Buy) will give the Gateway brand its harshest pressure in a long time. Acer can't afford to mess this one up, as the timing is not on its side at all. But, if it can try to be a strong third in the consumer market (as Acer has little business-market finesse), the company has a chance to actually, you know, make a consistent profit and grow sales. The largest challenge it has is being eaten by the two big dogs in the park.
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Reader Comments (Page 1 of 1)
12-17-2007 @ 2:51PM
Al Khan said...
Acer is a fantastic company and will no doubt emerge successful. It should drop the Gateway and the Cow logo company name like a hot potato. There is only so much you could do in the PC market. For the creative there could be a niche Acer can create to survive from the bid dogs who would be more than willing to eat the meal coming its way.
12-19-2007 @ 5:41PM
Waddayamean said...
The Gateway brand, no matter how maligned, still has much more brand awareness than Acer in the US. It would be fiscal suicide to drop the Gateway brand and try to raise Acer’s mind and market share. What would be the purpose of the buyout if Acer dropped the Gateway brand "like a hot potato"???