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Saturday, October 05, 2002
 Acer takes a tough line on Benq over branding
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Message Text: Acer may consider legal action against Benq’s distributors if they do not move to resolve disputes concerning the use of the Acer brand, an executive said. Acer CEO J.T. Wang warned that certain Benq products sold and marketed under the Acer name have “impacted Acer’s name and affected its operations,” during a press conference for the company’s latest product, its TravelMate C100 Tablet PC.

He added that rumors have been spreading among distributors that Benq will eventually take over Acer, casting a false and damaging impression of the PC maker.

Formerly Acer Communications & Multimedia (ACM), the peripheral-making unit of Acer switched its brand to Benq in late 2001. Acer still holds approximately 20% of Benq’s shares.

Since the name change, competition has been brewing as Benq moves into PC manufacturing and Acer makes plans to enter peripherals, pitting the two against each other in the areas of notebooks, monitors and optical discs.

One of the sticking points the two companies have sparred over is Benq subsidiary Daxon Technology, which has been manufacturing and selling Acer-branded recordable CDs to date. Wang said Acer has served Benq notices demanding the branding practice be dropped.

Benq denied ever receiving notification from Acer over the Daxon matter.

Jerry Wang, vice president of Benq’s global marketing office, said the company is “perplexed” by the tough line Acer is taking on the branding issue.

Acer’s top executives including chairman Stan Shih and CEO J.T. Wang have assured in earlier meetings with Benq president K.Y. Lee that Benq could continue using the Acer brand until the end of 2003, he said.

J.T. Wang also said that now with Benq’s entry into the notebook business, Acer is evaluating the move’s potential impact and reviewing its outsourcing strategies with Quanta Computer – also a supplier of Benq – on competitive reasons.

Sources told DigiTimes that Benq will start selling “Q”-branded notebooks at year-end, first targeting China.
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