By William Fellows Acer Group Inc has duly agreed to spend $8bn with IBM Corp’s technology group on component technologies for use in its PCs, servers and notebooks over the next seven years. It’s another huge win for IBM’s technology group, coming just months after it secured a $16bn deal from Dell Computer Corp. IBM […]
By William Fellows
Acer Group Inc has duly agreed to spend $8bn with IBM Corp’s technology group on component technologies for use in its PCs, servers and notebooks over the next seven years. It’s another huge win for IBM’s technology group, coming just months after it secured a $16bn deal from Dell Computer Corp. IBM SVP Jim Vanderslice hopes the two deals will encourage other IBM partners to expand their current relationships into similar kinds of full service arrangements. He says the deal covers not only discrete components but also integrated products and services too, as the group’s aim is to cultivate full-service OEM relationships. While the Dell deal is based on the sale of products, IBM and Acer say the scale of their new agreement is many times larger than that of IBM and Dell. Moreover the two do not rule out the possibility that IBM may acquire stock in an Acer Group unit but say they have not specifically discussed the sale of shares in troubled Acer Semiconductor Manufacturing Inc.
The deal is an expansion of an existing agreement worth around $4bn under which Acer manufactures Aptiva home PCs and Thinkpad I series notebooks for IBM. Big Blue also gets its own technology back under its deal with Acer’s Display Technology which last year licensed IBM’s TFT-LCD display process and will begin shipping 13.3 units next month. Acer is expected to sell up to $1bn LCD screens back to big blue. With the LCD market currently under restricted supply, IBM needs all the screens it can get from third parties as well as those it also makes itself. Acer will expand its ADT plant and a new Acer factory in China will come on stream next quarter.
Also under the new deal, Acer Semiconductor Manufacturing Inc gets access to a range of IBM microelectronics products plus access to chip manufacturing processes down to 0.20 microns. It already has access to process designs of 0.25 microns and bigger. The two say they will also jointly develop new system-on-a-chip solutions for products targeted at internet appliance and pervasive computing markets. They will integrate embedded PowerPC microprocessors with a variety of graphics capabilities into new ASICs. Acer chairman Stan Shih says that all of the PC expertise is now in place to create the kinds of cheap application-specific and internet appliance devices it wants to begin selling; what’s required are the infrastructure and services, some of which it hopes will flow from the IBM agreement.
The two will also develop products to build out Acer’s own e- business infrastructure and those of its suppliers. Meantime Acer will distribute IBM disk drives and other components through Acer Computer International LTD and Acer Sertek.