Despite being caught in Apple’s vise-like iPad and MacBook Air grip, Acer continues on with the belief there must be a market somewhere remaining for netbooks – maybe China. Monday, the head of the company’s China operations said “emerging markets” could boost vanishing profits. On Monday, the head of the company’s China operations said “emerging markets” could boost vanishing profits. In other words, everyone else may think netbooks suck, but they’re still good enough for those third-world citizens who don’t know any better.
According to industry publication DigiTimes, Acer vice president Scott Lin admits netbooks “only contribute limited profits,” yet said emerging markets “normally place large amounts of orders” for the devices largely consumed by Apple. Although Acer leads the netbook market with 1.7 million units sold in the third quarter, the Cupertino, Calif. tablet maker sold 11.2 million iPads during the same time – more than Acer, Asustek and Samsung netbooks combined.
The enormous demand for iPads over netbooks helped push Acer to its first quarterly loss during the second quarter. Little consolation came from the bizarre whistling-past-the-graveyard remarks by Acer Chairman J.T. Wang, who told investors consumers were just caught in a tablet “fever” that would soon recede (like Acer’s profits?) The Acer head is known for his spot-on predictions, like his 2010 pronouncement that the iPad would drop to 20 percent of tablet sales. Apple currently has more than 60 percent of the market and there’s no noticeable slippage in sight.
If netbook makers still think they can weather the iPad storm, there is also the MacBook Air – the $999 notebook that ate away any other reason consumers might have had to buy the cheap devices. The MacBook Air went from 8 percent of Apple’s notebook sales to 28 percent in just months. Now there is talk the MacBook Air could see an even steeper price cut as Apple preps a reported 15-inch model for early 2012.
But there could be some hope for Acer. Intel had promoted its Ultrabook laptops as defense against Apple eating more PC sales. However, unlike the devices’ “no-compromise” marketing, the chip giant won’t budge of its profits, causing some Ultrabook fans — including Acer — to jump ship.
However, betting it all on China may not be wise for Acer. The Asian nation has one of the largest markets, but it is not a miracle-worker. As we’ve reported, as China’s consumers become wealthier, they tend to prefer Apple products.