Asian Shakeup For The Technology Industry?

im making it a habit to read articles which are focused on business issues because gives u the hang of reading boring passages with ease... now some of u may feel that these arent boring but ask some like me we hate reading such articles... infact i never read the economic times i only read the mirror or Times....

Acer’s founder Stan Shih does not come across as a person who makes idle talk. So when he says something, the business world sits up and listens. After all, his company underwent a revamp in the last two years to emerge back in prominence among the top IT hardware manufacturers of the world. Acer overtook Dell in the last quarter of 2009 to become the world’s second-largest PC vendor. He argues that in another twenty years, companies like Dell and Hewlett Packard will no longer be around as the focus increasingly shifts to low-cost manufacturing models such as those by Dell or China-based Lenovo, which took over IBM’s PC division a few years ago.
According to him, the trend for low cost computing and networking devices is slated to continue, which companies like HP and Dell cannot reconcile to. He claims the US computer makers have no concept of low-cost manufacturing strategies and will lose out in the long run. However, not all are quick to agree with this point of view.
Experts say that possibly the words hold true for traditional PCs and laptops, but will the world continue to store data on local drives and need to carry a laptop around? Cloud computing, virtualization, remote data processing, remote storage through net-based servers, these and many more technologies could change the face of the technology world as we know it, claims David Carini, MD of Maverick China Research. With these technologies, US companies could evolve into something totally different, he argues.
According to industry watchers, Dell and HP should focus on making cooler, funkier PCs rather than try to bring down costs, as they are currently trying to do. Instead they need to adopt strategies like Sony’s Viao range or those of Apple, to make their presence felt in the market. A shift in strategy to manufacture not only PCs but also related technology devices, like Apple has done, could also yield rich dividends, says Jessica Lo of China Market Research Group. She adds that consumers are willing to pay a premium where they see value as in the case of Apple’s iPod and iPhone. The key according to many experts is to tie in innovation in the US or Europe with low cost manufacturing that comes out of setting up in places like China.
At the same time, selling on the low cost principle alone will not work for long. Costs, especially infrastructure and labor, have a tendency to rise over time as a particular destination becomes popular, as seen in the case of the BPO industry in India. Sooner or later, someone will find a cheaper way to do it, or change the face of the industry altogether. Then the low-cost manufacturers of today will be in the same position as the competitors they are pointing fingers at. After all, Dell was once known for its low-cost setup for assembling and shipping PCs in the US.

Source: testfunda.com
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