Dell to double R&D staff in Taiwan

Taipei, April 25, 2005 (CENS)--Dell Computer Taiwan Corp. (Dell Taiwan) has decided to double the number of its R&D staff members on the island to over 400 by the end of this year.

Dell's headquarters in the U.S. will send a marketing group to Taiwan to further strengthen the computer giant's cooperation ties with local contract suppliers. Dell is expected to procure about US$10 billion worth of products from Taiwan this year.

Dell Taiwan president Wu Tseng-feng said that Dell's procurement policy would undergo a major change this year. Dell will allow its contract suppliers to produce more models rather than some fixed items.

Quanta Computer Inc., for example, Wu said, used to produce mainly slim-type notebook PCs for Dell, and Compal Electronics Inc. heavy-user models. Dell now hopes the two companies to produce more models not made before, according to Wu.

Industry sources said that Dell's policy change represents its strategy to further upgrade contract suppliers' technical capabilities and make its order-placement more flexible with more bargaining chips.

Wu also announced that Dell has launched server models with 64-bit processors in the first quarter and is expected to utilize such new products to upgrade its market share in the coming replacement wave (64-bit models to replace older machines).

As all of Dell's Taiwan contract suppliers keep their R&D centers on the island, Wu pointed out, Dell has decided to recruit more professionals to expand its local R&D center. In a bid to construct a more comprehensive value chain for the company's products, Wu added, Dell would also send a marketing group to Taiwan to shorten the R&D and marketing period.

Dell's sales in the international PC market (including both desktop and notebook models) outstripped 30 million units for the first time last year to reach 31.77 million units, far higher than 28.07 million units recorded by major rival HP and generating record revenue of US$49.4 billion. Dell is expected to have revenue of about US$60 billion this year and its procurements from Taiwan is expected to grow to US$10 billion from about US$9 billion last year.