December 5, 2001 3:50 PM PST

Acer spins off peripherals unit

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Acer Communication & Multimedia, the peripherals manufacturing unit of Acer, has been spun off from the parent company and renamed Benq.

This is the second spinoff of Taipei, Taiwan-based Acer so far this year and is part of a larger restructuring operation. Earlier, Acer spun off its contract manufacturing operation, which became Wistron.

Like other hardware makers, Acer has been hit hard by the PC market's downturn, which began in mid-2000. The new Benq brand will be used in all markets, including the lucrative mainland China market.

Acer has had an on-again, off-again relationship with Acer C&M, which has functioned as a fairly autonomous subsidiary. Acer C&M tried to market scanners and CD recorders under the Vuego brand a couple of years ago, but then returned to the Acer brand.

When asked why creating a new brand would work now when it had failed before, Acer CEO Stan Shih said there was a "much (more) limited Chinese market back then."

That situation has changed. China has become one of the largest markets in the world for information-technology products and the fastest-growing major market. Acer C&M is already selling several products in mainland China, including LCD (liquid-crystal display) monitors and keyboards.

"With the current situation, we should be able to market our products under an independent brand. That's why we decided to come up with Benq," Shih added.

Staff writer Jack Kuo reported from Taiwan.

 

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