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Acer Likely to Withdraw From Tablet PC Market

2011/12/28 | By Steve Chuang

Taipei, Dec. 28, 2011 (CENS)--Routed by Apple Inc. in the tablet PC competition, the Taiwan-based Acer Inc., one of the world's top five PC suppliers by market shares, has intended to disband its touch business group in January, 2012, indicating its withdrawal from the competitive landscape to follow the footsteps of HP and Research In Motion.

Headed by Acer's corporate president Jim Wong, the touch business group was set up in April 2011 to develop and promote tablet PCs and smartphones, regarded as the company's best promising business unit then.

However, the momentary impression has proven unable to secure the business unit an expected success, as the company, after struggling with the sluggishness of tablet PC sales in the past months, is determined to dissolve the unit starting in January, 2012. Of over 300 workers of the touch business unit, 150, mostly R&D engineers, will be transferred to other business divisions, and only 100 will be retained, with the remainder likely to be laid off, according to industry insiders.

Although the disbandment has yet to be publicized, Acer directors have confirmed that the company has recently merged its Android tablet business, which originally belonged to the touch business group, into its global logistics center management, saying that the once-promising division now exists in name only.

With the touch division to be streamlined, market observers believe that Acer, which just halved its tablet PC sales projection to the range of only 2.5 million to 3 million units from 5 million units optimistically set right after the division was established, is likely to leave the challenging market that has been dominated by Apple with its iPad.

Although global PC makers have eagerly ventured into tablet PC business in the wake of iPad's success over the past year, many of them, however, have proven unmatchable with Apple in the competition, with HP and RIM already out of the market. Taiwanese contract manufacturers, such as Quanta Computer Inc. and Inventect Corp., have also been jeopardized by customer's withdrawal from the segment, forced to cut their employees as a result.