No plan to relaunch smartphones now, says Acer

Abhishek Law Kolkata | Updated on February 14, 2014

S Rajendran

Acer India, which exited its loss-making smartphone business some 18 months ago, is unlikely to relaunch handsets in the country in the “near future”, a senior official said.

The company , a fully-owned subsidiary of Taiwan’s Acer Computer International Ltd, used to sell smartphones in the price range of ₹9,000 to ₹40,000 on Google’s Android operating system. It also sold a few special edition Ferrari handsets.

“We are still exploring possible options (for re-introducing the smartphones),” S Rajendran, Chief Marketing Officer, Acer India, told Business Line, adding the company’s smartphone business has been “scaled down”.

India is one of the fastest growing markets for smartphones, where sales are doubling each year. Market research firm IDC’s data shows that India currently has around 40 million smartphones that is expected to surge to 155 million in 2017.

Rajendran was in the city for the launch of its tablet PCs – Iconia A1-811 and Iconia W4. Acer handsets are currently available in the US, Europe and other Asian countries such as Thailand.

High Costs

According to a company official, high cost of upfront investment in terms of setting up retail stores and the absence of bundling offers have forced Acer to put plans of a likely re-launch on the back-burner.

Bundling (telco-carrier model) refers to offerings where handset costs are subsidised by mobile operators (telecom companies) once users opt for a combined data and voice package. Market sources indicate that in telco-carrier models, investments by handset vendors are substantially lower than setting up own retail chains. Even marketing costs are to an extent taken care of by the telcos. However, with “prepaid users” dominating the market, the concept of handset-bundling is yet to take off.

Tablet Strategy

According to Rajendran, the company is banking on its tablet PC strategy to garner a greater market share. Apart from retail sales, the focus would be on penetrating commercial and corporate segments.

By this year-end, the company is looking to increase its share in the commercial tablet PC segment to 20 per cent from the existing 5 per cent. The remaining 80 per cent would be through retail sales.

Published on February 13, 2014

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