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Case Title:

Acer: Will its LCD TV venture be successful?

Publication Year : 2005

Authors: M V Patil, Sagar Chakravarthy

Industry: Engineering, Electrical and Electronics

Region:Taiwan

Case Code: IPD0029B

Teaching Note: Not Available

Structured Assignment: Not Available





Abstract:
In 2005, Taiwan’s Acer, was the world’s No.4 branded PC vendor with a market share of 4.4%. In the same year the revenues of the company reached to US$9.7 billion. Acer’s product portfolio included notebook and desktop PCs, Liquid Crystal Display (LCD) TVs, projectors, servers, cameras and handhelds.

Acer executives predicted that their desktop computer sales would gain strength and that the company would soon surpass China’s Lenovo, which was No.3 in the global PC sector. To bolster earnings, Acer sold the stakes which it had in Taiwan Semiconductor Manufacturing company (TSMC) and other companies. The company did this because it was facing two very significant competitive challenges by Dell and Hewlett-Packard. These two American giants were putting lots of pressure on the Taiwanese company by lowering their prices. Dell was cutting prices so much that Acer's price advantage was disappearing.

As a result Acer decided to focus on LCD TVs to reduce its reliance on notebook PC sales and other computer peripherals. LCD was another business area of Acer. It was believed that moving into TVs represented a major about-face for the company. By 2007, the company was expecting revenues from LCD TVs to surpass $1billion.

Would Acer’s diversification into LCD TVs guarantee retention of its market position?

Pedagogical Objectives:

  • To understand the evolution of Acer company
  • To understand Acer’s entry and focus in the LCD TV market and reducing its reliance on notebook PC sales and other computer peripherals
  • To understand Acer’s Australian market.

Keywords : LCD; PDP; Micro-processor; form factor; Heuristic Thermal power; Management System; Innovation Management Case Study; Palm Operating System; Response time; contrast ratio; resolution; Integrated Circuit; Displays; X computer concept; 'Hongya'

Contents:

  • Company Overview
  • Entry into LCD Market
  • LCD – one of the Strategic Moves
  • Threat from BenQ
  • Future Outlook

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