Acer-Gateway Merger Brings Employee PC Ownership One Step Closer

Rob Enderle

The back story behind the recent announcement of Acer's purchase of Gateway's is interesting drama. It seems that Lenovo was going to buy Packard Bell in Europe as a cornerstone for moving into the European consumer market. To get there, it had to effectively out-bid Acer, which in the case of a Chinese versus a Taiwanese company, would have been very embarrassing. Acer found out, likely from the ex-Gateway CEO, that Gateway had the rights to buy Packard Bell. Acer has been signaling a stronger return to the United States for some time (I predicted it back in 2004) and was able to effectively kill two birds with one stone with this move.


More interesting for you folks is that Acer doesn't want Gateway's business lines. Margins in the business segment have been very low; corporations haven't been buying aggressively (and have indicated they plan to bypass Windows Vista and much of the hardware that ships with it).


If Acer is reading the market right, and it well may be, the corporate market is setting up to make a significant policy change -- one led by the education market, where Gateway traditionally has done very well. The business market also may be getting ready to switch to a new platform, which could include Linux, but likely will be as different on hardware as anything else. And different, for now, means bladed PCs, a new class of smartphones, and/or thin clients.


Acer Pushing the Employee-Owned PC Option


The only one of these that Acer will be in position to push is the employee-owned PC model. Acer will focus heavily on design and price, and is likely to use something like the Mojopac to address the corporation's need to control the business environment while allowing employees to purchase their own PCs.


This trend also could benefit Apple, which has avoided making a big business push, but has been positioning Leopard as providing a similar kind of solution to the Mojopac but on the Mac OS. HP, of course, has the strongest hedge with thin clients, blade PCs and the strongest three consumer lines in market.


I've brought this potential trend up previously, but didn't point out that the education market in the United States had started implementing it some time ago. In a number of U.S. locations, teachers, administrators and students buy their own school-related PCs and get limited support from school IT staff.


This has proven popular in an environment that is perennially underfunded and has a history of providing technology that is decades old. It suggests that as these students become employees and eventually managers, they will bring with them the idea of personal PC ownership and drive similar policies into their respective companies.


And Then There Were Four


Post-merger, this leaves us with only four major companies, one of which apparently isn't going to be going after the large business, government and enterprise markets directly. This puts Toshiba and Sony on notice of being trivialized, makes Fujitsu the likely buyer of Gateway's business lines, and validates Apple's existing strategy of focusing on the consumer.


In a strange way, this could benefit Dell, HP and Lenovo near-term because it -- at least for a time -- removes Gateway from the business mix and focuses that company on a merger. However, strategically, Acer is scary good, and this merger gives Acer the powerful channel in both the United States and Europe that could be used to accelerate its already impressive growth rates in those regions. Mergers are not a given, so there is some risk, but Gateway does have near-term experience doing one successfully, which should help.


In the end, the market is changed, the future is more closely aligned with individual PC ownership (or something even more dramatic), and we have four major PC vendors (plus a wild card in Apple) vastly simplifying the market and our choices in it.

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Add Comment      Leave a comment on this blog post
Aug 30, 2007 5:19 PM Loraine Loraine  says:
True, teachers do buy many of their own supplies. Except here's the thing: As far as I know, this is common for public school teachers, not private school teachers. And public schools are non-profit organizations with limited resources. Teachers also view themselves as having a 'calling,' and therefore would be more incline to go that extra step than someone in the private sector.Also, it's important to point out that we're facing a teacher shortage. I can't help but think the economics of the job - including such ridiculous things as having to spend their money on supplies - contributes to that problem. And it definitely contributes to low morale - I know: I've heard teachers complain about this issue all my life.So, while this practice may be common in education, it's more of a worst-practice than a best-practice. I can't think a for-profit business would want to adopt something so ridiculous and pay the soft costs, plus lose the tax write-off, just to the to save a few hundred dollars per employee. And, just to be brutal about it, do you really want to hire someone who's such a smuck as to agree to this? Reply
Sep 5, 2007 7:02 PM Qamar Qamar  says:
I work for avery large organisaion that has thousands of PCs in their n/w. Uptime of the PCs is very critical to the success of the organisation due to high relinace on e-workflow applications - vital to faster appovals and 'paperless office' objective. If a PC has a problem its fixed/replaced immediatley. If employees own their own PCs then PC uptimes cannot be gauranteed and hence intial savings of few hunder dollars may result in business losses of thousands of dollars and loss of productivity! Further, the PC environment is strictly controlled so that we can avoid viruses and denial of service (DOS) attacks. On employee owned PCs this will not be possible as the companees will have little or no control over someones personal property. So, that will make us more vulnerable to viruses and DOS attacks and hence eventually may result in loss of employee time and/or business.So, to conclude, I don't see the idea of employee owned PCs being successful in commercial organisation. Reply
Mar 18, 2008 5:47 PM Chris Chris  says:
The whole idea of employee owned computers is ludicrous. Admittedly, I work for the Navy so it is a different environment, but we cant even have privately owned cell phones in the building much less privately owned computers.An organization that allowed private computers, or data storage devices, in their space would be asking to have their proprietary data stolen by a corporate raider. One of the key reasons (besides up-time) for the business to own the computer is so they can monitor what you do with it.You must have never worked in the Real World Reply

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