Acer 2010 Annual Report Download - page 25

ACER INCORPORATED 2010 ANNUAL REPORT
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ACER’S WINNING FORMULA
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5.1 Business Scope
5.1.1 Business Portfolio
Acer’s core business comprises of the personal computer, liquid crystal display, projector, smartphone, tablet PC, and
information communication devices (ICT). Starting from R&D, marketing and sales to services, our business strategy
involves multiple brands and operations around the globe.
In 2010, notebook PCs – including netbooks – accounted for 70% or the largest share of our revenues from IT
products, while desktops contributed to 17% share. Today, facing a new ICT landscape and market demand, the
PC remains the core of Acer’s business. With this solid PC foundation, we aim to quickly yet cautiously develop
smartphones and such strategic products.
5.1.2 Industry Highlights
In 2011, the global PC market is expected to continue growth with notebooks taking the lion’s share of the market.
Demand from emerging markets will lead this global PC growth. As PCs become an indispensable companion for
everyday life, consumer products will play a bigger role, while commercial products also have high growth potential,
notably in the SMB market.
Looking at computing application trends, the prevalence of new digital media and services is converging with
the internet and influencing lifestyles. Consumers demand convenient access to the internet and desire for new
applications. As a result, tablet PCs, other mobile internet devices and open operating system platforms will see rapid
growth, while consumer PCs will experience a slow-down. The ICT industry landscape will be greatly altered.
5.1.3 Technology and R&D
In 2010, Acer’s spent NT$1.2 billion on R&D, focusing on the user interface, industrial design, and ICT-related hardware
and software. Acer successfully launched the clear.fi solution in 2010, which enables real-time sharing of different
formats of multimedia content over multi-platform devices. clear.fi is the home network by Acer that integrates
technologies and devices intelligently to make digital content readily available anywhere in your home.
In the future, Acer will strengthen its R&D for tablet PCs and smartphones, especially those related to content and
services, with the ultimate goal of creating more value for our customers.
5.1.4 Long and Short Term Business Plans
Based on the solid foundation of our core PC business, in the short term Acer will aggressively yet cautiously develop
tablet PCs and smartphones. In addition, we aim to boost our sales in commercial PCs and make significant expansion
in key emerging markets.
In the long run, we aim to achieve a better balance of revenues from our regional operations and various product lines.
Moreover, we will strive to enhance our brand position, create customer value and pursue for better operating income.
5.2 Market Highlights
5.2.1 Market Study
Acer’s key market is EMEA (Europe, Middle East, Africa) followed by the U.S. and Asia Pacific. According to research
company, Gartner, in 2010 our market share and rank in EMEA for total PCs were 19.7% and No. 2, for notebooks they
were 24.8% and No. 1 respectively. For total PCs in the U.S. we held 11% share and ranked No. 3, while in Asia Pacific
we took 8.7% share and ranked No. 4.
We expect global PC sales to continue growth, with emerging markets leading the way. The consumer PC market will
benefit as families demand more PCs, while commercial products in the SME market also have potential for growth.
However, rise of tablet PCs will impair the notebook sales, especially on the consumer notebook segment.
5.3 Keys to a Sustainable Future
5.3.1 Sustainable and Profitable Business Model
Acer adheres to a channel business model that involves collaboration with first-class suppliers and distributors,
leveraging their resources and ultimately, sharing the fruits of success among all partners. Besides, our low capital-
and operating expense policy has been beneficial to the steady growth of our business operations.
5.3.2 Fast Response and Decision Making
With a solid, global management force and efficient internal communication, Acer has the advantage of being able to
make key decisions within a short timeframe. Precise, follow-up implementation enables us to capture and gain from
business opportunities as they arise.
5.3.3 Customer-Centric End-to-End Marketing Strengths
To begin with, our products are designed around customer needs – that means listening to and understanding exactly
what our customers want, and using our knowledge and skills to exceed their expectations by making technology
simple to use, stylish to own and accessible to everyone. Combined with Acer’s fast decision making, call to action
and timely release of products to market, they form an end-to-end marketing prowess that ensures continuing our
business success ahead.
5.3.4 Efficient and Competitive Global Operations
Based upon the management philosophy of upholding a “simple” and “focused” approach, Acer is focused on building
its brand name business, developing mainstream products and maintaining competitive operating costs. In addition,
Acer has a flexible and dynamic global logistics network to ensure our products’ time-to-market.