Compaq, IBM dump on Taiwanese PC manufacturers

Island could lose loadsa OEM business

  • alert
  • submit to reddit

Top 10 endpoint backup mistakes

Reports in the Taiwanese press said yesterday that both Compaq and Big Blue are to cut original equipment manufacturers (OEMs) on the island out of their manufacturing loop in 1999. And other worldwide PC companies are likely to follow in a bid to slash their costs, affected by the much lower prices of PCs in the shops. The reports may form part of a revised Compaq strategy, in which its OEM division may be floated off as a separate company. Over the Yule period, Compaq has made a number of changes to its overall strategy, including ditching its networking division and cutting another 3,000 jobs worldwide. Last month, IBM abandoned its attempts to sell PCs through two tier distribution, while just before Christmas, Hewlett Packard announced its plans to sell more of its PC and printer products direct. These companies are reacting to the success of the Dell Corporation. The reports claimed that both Compaq and IBM will now locally source a number of components including displays and storage devices without recourse to OEMs. It is an open secret in the industry that big US PC players have allowed locally based company to build notebooks and desktop PCs for them for some years. Now they just want Taiwanese companies to make the components, such as semiconductors, displays, and CD ROMs. Giant OEM Acer is likely to be the worst affected, but a number of other companies, including Mitac, also make products for PC companies. Acer is already reeling from poor financial results, largely caused by its DRAM business. While Taiwan now has large semiconductor fabrication plants, the news will be a blow for the island. Many of its small businesses and a high proportion of its exports are funded by the PC industry. Earlier this year, officials representing the Computex Trade Fair reported a far smaller number of foreign visitors than in previous years. ® Some Related Stories Compaq Compaq to continue Big Cuts Compaq to get out of networking Compaq decks an extra 2,700 jobs Compaq no Father Christmas as Alpha layoffs rise Now France gets Santa Pfeiffer treatment IBM Analysis: Compaq, IBM squirm between devil Dell and deep blue sea Big Blue goes direct, claims Compaq has followed IBM MinkPads to go direct PC age over, says Gerstner Acer and Taiwan Acer's chief takes pay cut as Taiwan warns of recession Full Computex Coverage Others HP to widen range of products sold direct Toshiba goes direct in Japan. Next step, Europe?

A new approach to endpoint data protection

More from The Register

next story
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
Nintend-OH NO! Sorry, Mario – your profits are in another castle
Red-hatted mascot, red-colored logo, red-stained finance books
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
Feel free to BONK on the TUBE, says Transport for London
Plus: Almost NOBODY uses pay-by-bonk on buses - Visa
Twitch rich as Google flicks $1bn hitch switch, claims snitch
Gameplay streaming biz and search king refuse to deny fresh gobble rumors
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
prev story


7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Solving today's distributed Big Data backup challenges
Enable IT efficiency and allow a firm to access and reuse corporate information for competitive advantage, ultimately changing business outcomes.
A new approach to endpoint data protection
What is the best way to ensure comprehensive visibility, management, and control of information on both company-owned and employee-owned devices?