Challenge to Microsoft’s XP and Vista systems

Acer to launch Google Android notebook
By Robin Kwong in Taipei
Copyright The Financial Times Limited 2009
Published: June 2 2009 14:59 | Last updated: June 2 2009 14:59
http://www.ft.com/cms/s/0/c6f6df28-4f74-11de-a692-00144feabdc0.html


Acer, the world's third biggest PC maker, on Tuesday said it would launch the world's first notebook computer to run on Google’s Android operating system in the third quarter of this year.

The marriage of Taiwan-based Acer's low-end Aspire One netbook with Google's Android operating system, which was originally designed for mobile phones, highlights a continued blurring of the lines between smartphones and computers.

It also poses a challenge to Microsoft by offering an alternative to its Windows XP operating system, which dominates the netbook market with a roughly 80 per cent market share. Microsoft charges about $20 a computer for XP and $40-$45 for the newer Vista version of Windows, analysts say, while Google does not charge for its Android system.

While the price of Acer's new notebook, which runs on both XP and Android operating systems, will not reflect the free Android operating system, it will be cheaper than the current Aspire One models, the company said. Acer declined to comment more specifically on its pricing strategy for the new product.

Sandy Lin, the software product manager at Acer who headed the project to bring Android to computers, said price “was not our main concern. We wanted to offer users the flexibility [of using both operating systems]”.

Jim Wong, president of IT products at Acer, said the main attraction of using the Android system was its fast start-up time. “No other operating system allows users to power up [the computer] in 18 seconds and power down in one second,” he said.

He added, however, that "we have to make sure the old choice [Windows] doesn't disappear”.

The growing popularity of devices that straddle the mobile phone and computer markets, such as netbooks – small, cheap notebook computers – and smartphones – advanced mobile phones with computer-like capabilities – has sparked new competition among chipmakers and hardware manufacturers as each tries to expand into new markets.

Acer, which announced its first smartphone product in February this year, said this week that it would join Google's Open Handset Alliance and launch its first Android-based smartphone before the end of the year.

Among chipmakers, Intel, whose processors dominate the computer market, earlier launched its low-powered Atom for netbooks and is working on a chip for smartphones.

Meanwhile, Cambridge-based Arm Holdings, whose chips are in nearly every mobile phone, aims to enter the computer market through Arm-based chips developed by Qualcomm and Freescale.

Qualcomm, the world's biggest wireless chipset company, said this week that some 40 smartphones and notebooks using Qualcomm's Snapdragon microprocessor chips are currently in development. The first such notebooks will be on sale by the fourth quarter of this year, the company said.

Warren East, Arm Holdings chief executive, told the Financial Times this week that Arm aims to have an even bigger market share in the overall internet and electronics market than Intel.

Acer’s move comes as PC demand, which has suffered from the global economic downturn at the end of last year, have started to show some signs of stabilising. Acer's Mr Wong said sales in the second quarter had improved over the previous quarter. However, he said it was “hard to tell” whether this represented the beginning of a sustained recovery.