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It's Acer's turn in HP patent dispute

  Patent Law  -   POSTED: 2007/04/03 18:41

The Taiwanese Acer company faces great obstacles on its path to become the world’s third personal computers producer, thanks to a law suit by Hewlett-Packard (HP) and the fierce competition by Dell.

According to The Liberty Times, HP on Tuesday levelled a law suit before a Texas court, accusing Acer of using five of its patented technologies for the production of PCs. In its law suit, HP demands a cessation of sales of Acer’s computers, laptops, media centres and similar products in the United States.

This more of a rival tactics, said Kirk Yang, an analyst of the Citigroup Investment Research company.

Daniel Chang of the Macquarie Research Equities agrees with such an assessment. We believe that this is only the first step of the HP to fight off a strong rival, by hindering Acer’s growth, he said.

The law suit could prove fatal for Acer, to which the USA is the second biggest market. Its American distributors may not want to take on the risk of selling Acer products in fear of law suits or a court ban whose rescinding could take time.

The USA is credited for around 20 percent of Acer’s incomes. In 2006 the company produced 1.1 million PCs and 311,111 desktop computers and hopes that sales in the US will increase by 25 percent in 2007.

Analysts also warned of the serious competition by Dell Inc. the company’s CEO, Michael Dell, visited Taipei on March 19, where he met with Taiwanese distributors, which caused speculations that Dell planned to order more complete laptop products from local companies.

Such a move would be negative for Acer that completely counts on distributors in the sale of computers, while Dell uses direct sales models.


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