Acer CEO: Microsoft Should Rethink Its Surface Tablet Decision

– ‘Negative for the Worldwide [PC] Ecosystem’

Microsoft is being pulled in two directions. It sees what Apple has accomplished by developing tightly integrated hardware and software. (Apple even customizes the ARM-based processors that Samsung makes for it.) Microsoft has been very dependent on its hardware partners like HP, Dell, Lenovo and Acer in designing and producing hardware. Apple’s immense success in tablets has lured Microsoft into developing its own tablet – the Surface. Microsoft’s hardware partners, on whom Microsoft is still dependent for PCs, have so far been silent publicly about Microsoft’s move to launch its own brand of tablets.

Taiwan-based Acer is the first to complain publicly about Microsoft’s plan to produce the Surface tablet. The Financial Times reports that Acer chairman and CEO JT Wang said Microsoft should reconsider its upcoming launch of the Surface tablets. He said such a move would be “negative for the worldwide [PC] ecosystem.”

If the Surface is well done, it could be negative to Acer’s sales because it will have to compete against Windows 8-based tablets in addition to other companies’ Windows 8-based tablets such as HP, Lenovo and Dell, plus Android-based tablets and, the mightiest of them all, Apple. Surface will especially be a problem for PC makers if the Intel version of Surface is positioned for businesses that already own millions of Windows PCs and are not going to switch to Apple, Android or Chrome OS PCs.

“We have said [to Microsoft] think it over,” Wang told the Financial Times. “Think twice. It will create a huge negative impact for the ecosystem and other brands may take a negative reaction. It is not something you are good at so please think twice.”

Microsoft admitted in a recent SEC filing that it faces a potential problem. It said, “Our Surface devices will compete with products made by our OEM partners, which may affect their commitment to our platform.”

Microsoft has so far announced it will offer two Surfaces:

– An ARM-based tablet in October that uses Windows 8 RT. We also expect to see some ARM-based laptops that use the RT version. Qualcomm, which will produce Windows 8 RT-compatible ARM-based Snapdragon processors, has hinted at such. An ARM- based laptop (which cannot be called Ultrabook because Intel owns that brand) would be expected to have longer usage between battery charges, produce less heat, and so be lighter by not needing a fan and be at least a bit smaller.

– An Intel-based tablet in about January that will use Windows 8 Pro, the same version of Windows 8 that will be on PCs. AMD can be expected to introduce a similar processor for laptops. Microsoft has said tablets with Windows 8 Pro can run any software that runs on current versions of Windows such as Windows 7. That will have enormous appeal to the corporates.

Windows 8 tablet makers will also have to decide which Windows 8 tablet to make: ARM-based or Intel-based — or both.

Acer has said it will use the Iconia brand for its Windows 8 tablets and HP will use the TouchPad brand.

The paper also reported that Campbell Kan, Acer’s president for personal computer global operations, said Acer is debating internally what to do. You can bet that HP, Lenovo, Dell and other PC makers have been having the same debates internally.

Microsoft is too committed to the Surfaces to back down at this point. The best that PC makers can hope for is that Microsoft will not push its Surface tablets such as by selling them at a premium price. Then it could say that the Surfaces are a proof of concept, rather than intended for the mass market. It could say it just wanted to show tablet makers what could be done.

“If Microsoft is going to do hardware business, what should we do? Should we still rely on Microsoft or should we find other alternatives?” Kan asked.

Well, there’s always Android, which most other tablet makers are using, most successfully by Android’s owner Google, but also by Samsung and Amazon. Then there are many other variants of Linux, on which Android is based. There’s always RIM’s QNX operating system. In fact Acer could buy all of RIM and get in the smartphone business in a big-time way. Acquiring RIM and its Blackberry operations would also give Acer a strong in- road at the corporates for its PCs as well, which might give rivals HP and Dell fits.

The most successful tablet OS of them all is not ever going to be available — Apple’s iOS.

A note of caution: The certainty of Windows 8 is not yet assured. It was only one Windows generation back that Microsoft launched Windows Vista on the world only to see it get many negative reviews and cause the corporate by and large to avoid it completely.

About the Author

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