Acer plans £150 computers

Turning the notion of the sub-$1,000 PC on its head, The Acer Group is getting ready to turn out a series of "single application" computers that could cost as little as $200, aimed at users who can't afford a traditional PC.

The devices, dubbed X Computers, or XCs, by CEO Stan Shih, could include a KC, or kid's computer, which would be a basic box with a CD-ROM and child-modified input device that hooks up to a television. An HBC, or home banking computer, would become a "branch of your local bank." Other XCs could be targeted at gaming, education, and Internet access.

The XCs were first discussed by Shih at a conference in San Francisco in November, but Acer has been toying with the idea for a while. Some devices, including TV set-top boxes, are already being test-marketed in Taiwan, said Chris McKie, spokesman for Acer America, the group's U.S. division.

XCs may be given a trial in Latin America early next year, and should start appearing in the United States throughout 1998. Acer has not made a formal announcement of its plans, however.

The company, based in Taiwan, certainly has experience building cheap computing gear. It developed one of the first sub-$1,000 PCs, a category that has recently caught on with consumers.

Unlike the highly touted network computer, which is designed to use a central server for the majority of its processing work, an XC would have its own processor compatible with existing technology, although it's not clear whether Acer would use Intel Corp. chips.

Acer is not the first company to try selling a "less-than-a-PC" device. WebTV Networks Inc., recently acquired by Microsoft Corp., is expected to add more features to its basic Internet access device next year. And Sun Microsystems Inc. subsidiary Diba has already started selling software for such devices. Even Martha Stewart has talked about developing a computer specifically for the kitchen.

"There's clearly a future for non-PC devices, or information appliances. They'll become a bigger and bigger factor," said Bruce Stephen, analyst at International Data Corp. in Framingham, Mass. "And there's a lot of companies entering now. What's significant here is that this is one of the first major PC companies to go off in this direction."

"There is a market for those type of devices, but I have no idea how big it is. Stan's going to be a pioneer and find out," said David Wu, analyst at the Chicago Corp. in San Francisco.

But while the U.S. market is certainly an appealing one to Acer, the company believes the devices may end up being most popular in less-developed countries, where a $200 machine is a major purchase.

In Asia