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Acer predicts end of cheap PC era

Consumers get bitten in the ASP

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PC buyers, especially small businesses, should get used to paying more for their kit, after Acer predicted that ASPs would rise this year, for practically the first time in PC industry history.

Walter Deppeler, senior corp vice president of the Taiwanese PC giant, said that the company saw a revival in the PC business in the second half of last year after the turmoil of 2008 and early 2009.

"One year ago we were in the middle of the tunnel," he said. "One year on, we can start to see the future starting to look much better."

He expected this to pick up steam this year, helping Acer realise its ambition of becoming a $30bn company by 2012. This will require the company to grow by 15 per cent a year between now and then.

This in part will come from expansion in growing markets, as well as new segments in mature markets. The firm expects mature markets to see continued growth as new demographics, including the old, children and women, start to spend more money - though not necessarily their own - on technology.

Deppeler said the small businesses would "come back this year" if only because they had to replace increasingly aged kit.

However, PC buyers will play their part by having to fork out more money for PCs. Deppeler said that after a decade of dollar weakness, the greenback was now strengthening again, and this would help put a floor under prices.

At the same time, the firm did not see oversupply in the components markets, further checking what had seemed like a natural decrease over time in tech prices. Finally, consolidation in the components, vendor and channel markets would help drive prices up.

The crunch could be particularly hard in the Eurozone, as the parlous condition of Greece, Spain and other countries drives the currency down. Deppeler said that in the short term, prices could be 10 to 12 per cent higher than they were in last year's holiday buying season.

Acer has of course played its part in this, swallowing up the likes of Gateway and Packard Bell over recent years.

However, it's increasingly clear that it's going to be a long time till British consumers see a 2 to 1 exchange rate against the dollar.

And those companies who pared to the bone during the recession, and had the resources to pick at the corpses of rivals who didn't make it are no doubt going to make hay as soon as the sun starts to shine again. ®

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