Acer’s future is in the cloud

XIZHI, Taipei, Taiwan – Stan Shih, co-founder and chairman of hardware and electronics giant Acer, has his head in the clouds  Build Your Own Cloud, that is.

Exclusively speaking to a select group of Philippine media here at the Acer headquarters, he excitedly anticipates his imminent retirement — confident that he leaves the company in good fiscal position, and in good hands. Shih also expects that the Build Your Own Cloud service that Acer now banners will give the company a key competitive advantage over its rivals in a rapidly evolving arena.

Established in 1976, Acer has grown to become the fourth largest PC vendor in the world. The path to its vigor has not been always straightforward, but Shih has made a name for himself as an expert in reengineering — a skill he has put to good use shaping and molding the company to face contemporary challenges.

Last year, Acer was faced with such a hurdle — incurring losses totaling $691 million with the decline of PC demand. Investors started to panic, and called up Shih out of retirement to reclaim the chairmanship of the company he helped build (and is the biggest shareholder of).

Among other efforts spearheaded by Shih were a restructuring and a reimagination of Acer from a hardware company into a hardware, software, plus service firm. Four business groups (notebooks, desktops and displays, tablets and cloud, and smartphones) were spun off from a lone silo for greater adroitness. While Acer officials maintain the company will always consider PCs as the core of its business, the tablets and cloud business unit — headed by Shih’s son Maverick — surely warrants extra attention from industry observers and consumers alike.

Leading information technology research and advisory company Gartner Inc. predicts that among the top 10 strategic technology trends for the year is “how the personal cloud (will) impact IT organizations.” It is now the era of the personal cloud, the report continues, and “IT organizations will find (that) current approaches to dealing with users will fail. IT leaders must be flexible and respond with new techniques, tools and policies, or risk irrelevance with their user base.”

Shih admits that Acer has no choice but enter this new frontier — ushered there by market forces and user demands. Still, the Acer executive is adamant about one thing. “We do not choose the American model,” he declares.

The paradigm of which Shih speaks is a “winner-take-all” business ethos. Now, the Acer founder hatches a service platform that plays on the BYOD (bring your own device) parlance, an increasingly common phenomenon in offices around the world. Shih cleverly calls it BYOC (Bring Your Own Cloud), a proprietary Acer platform that now seeks to redefine cloud computing into a more personal, secure, and convenient experience.

“There’s no way for Acer from Taiwan to compete against the American way,” insists Shih, and adds that the Western solution is not “necessarily good for other countries.”

BYOC, he stresses, is Acer’s “own formula… it’s a totally new concept… public and private clouds just offer storage and infrastructure. Our approach is to involve the PC in your cloud because it is already installed. It has computing power and storage space. That’s the fundamental concept of this different approach. It’s a new ecosystem.”

Acer says in marketing materials that the BYOC lets the user decide on the size of, and where to store, his files. The cross-platform, multi-device, multi-network cloud is easy to set up and control, while letting the user stay connected to any Acer device and from anywhere. With growing concerns over data security and privacy, BYOC reportedly offers a better alternative as the data are stored in one’s own PC.

Bloomberg notes that with the entry into the cloud-computing business, Acer is now positioning itself against giants such as Amazon and Google — with the difference being that the “maker of notebooks wants you to host the service on your own personal computer.”

Acer obviously wants to differentiate the service from existing ones — even in the way it is packaged and marketed. There is a decidedly Eastern flavor in the stylized graphic of a cloud, and its mascot abWuKong (“ab” meaning Acer Build Your Own Cloud). The monkey “was inspired by the Sun WuKong character in the ancient Chinese novel Journey to the West. In the story, Sun WuKong travels on a cloud, using it to cross thousands of miles in a single leap,” reads the BYOC brochure, obviously an apt analogy for the service.

“My mission is to take care of the emerging market… the bottom of the pyramid. I don’t think the American (companies) will take care of that,” continues Shih, who steps down today, June 16. He turns over the reins to fellow Acer founder George Huang, and looks forward to devoting more time to his Stans Foundation that seeks to “share experience (with) and cultivate young Taiwanese leaders with international perspective.”

When asked by The STAR how he would differentiate Acer not from American companies but from other Asian competitors, Shih quickly replies: “WangDao. I try to convince all our colleagues to follow WangDao and be more sustainable — and have a stable, reasonable return; it’s long-term approach. Others have a winner-take-all culture. Some people in Asia, they like to be world number one.

“I don’t care if we are number one or number three. I care about how we can contribute to society. I believe that if we contribute to society, naturally we will make some reasonable return. I have good money already, I have a good name already,” he says with a smile.