Acer Plays Its Android Card

Posted by: Peter Burrows on June 02, 2009

I just got the press release from Acer, announcing it’s long-rumored Android-based netbook. More important, the fast-growing PC maker states its intention to make many more devices based on Google’s free OS:

The introduction of Android into Acer netbooks presents customers with another choice of operating system. In addition to Microsoft’s operating system, the majority of Acer netbooks will also offer Android in the future. Users may then select their preferred choice of operating system. Acer believes the Android operating system will contribute significantly to the worldwide netbook market growth.

That’s pretty bold talk for a Windows licensee. While PC makers have done deals with Windows alternatives—namely Linux—in the past, they never put much real muscle behind them. After the original press release, you never heard much more, leaving the sense that the deals were more about trying to gain a bit of leverage in securing lower pricing in licensing talks with Microsoft, rather than really trying to spark sales of non-Windows devices.

But Acer, given a low-margin business model that relies on high volume sales, seems serious about getting behind Android. And it’s doing so at a time when Microsoft seems to be doing what it can to make the world forget the netbook fad of 2008. Word from the company is that more and more, the netbook is nothing more than a laptop with a smaller screen. The evidence: that more than 90% of netbooks now run Windows, sell for something closer to $500 than $200, and differ from notebook PCs only in that they often have smaller screens. One can understand why. Having just announced the launch date for Windows 7, October 22, Microsoft wants to push average PC selling prices northward to maximize its profits on the long-awaited replacement for Vista—not give it away for anything near the $15 or so Microsoft gets for the older Windows XP variant that runs in most netbooks today.

Evidently, Acer has other ideas. It’ll be interesting to watch how the relationship of Microsoft with its fastest-growing PC partner develops.

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Reader Comments

HereAndNow

June 4, 2009 06:01 AM

Acer should include ALL smartphone hardware with their Android netbooks (3G, GPS, accelerometer, compass, etc.), to enable support for cell phone calls, SMS, location-based services, automatic screen rotation, etc. This functionality would help to differentiate their Android netbooks from their Windows netbooks. The Acer Android netbooks are likely be VERY attractive to mobile operators, because mobile operators would be able to generate revenue from phone calls, SMS, location-based apps & services, etc., in addition to basic data contracts. HP & Dell better be careful not to miss this opportunity, like they did the initial netbook gold rush, lest they cede even more market share to Acer.

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BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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