Acer's plight: What would you do to fix the business?

Summary:Acer will take years to turn around unless there's some hit or strategic design thinking.

Acer's new CEO, Jason Chen, held his first press conference and disappointed because he didn't have details about future plans. The larger question is whether any plan adds up for Acer.

Reuters noted that Chen spent a lot of time recapping past issues and little on direction and a master plan. Chen is now CEO after J.T. Wang resigned in November. Wang was replaced by Acer president Jim Wong, who lasted a few weeks.

Here's a look at Acer's core problems:

  • Acer is a rollup of Gateway and Packard Bell and rode the netbook wave for a bit. Netbooks tanked with the rise of tablets. All the Acer brands scream commodity computing.
  • The company bet on ultrabooks and touch screens too early, said Chen.
  • Acer is trying to integrate hardware and software with services (who isn't).
  • The company has some momentum in tablets, but isn't a leader by any stretch.
  • It's unclear that Acer has a brand that can compete with rivals.
  • Acer wants to be a cloud computing player with its AcerCloud efforts, but it's not something that's driving sales.

Add it up and Acer's market share fell more than anyone in the fourth quarter, according to IDC.

ACER standings

 

Bottom line: Chen probably would have loved to outline a master plan for the company, but a rebound will be tricky. Acer will take years to turn around unless there's some hit or strategic design thinking. In the PC market, most of the unique moves are from Lenovo and Acer lacks the scale of the larger players like HP. These revenue and gross margin trends can't be turned around quickly. 

ACER revenue trend

 

Topics: PCs, Hardware

About

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CN... Full Bio

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