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Asustek considers acquisition to expand in motherboard market

Published: Thursday, July 19, 2012 | Posted By: Dennis

In a market that has put increased pressure on mobo makers to cut costs and build smarter designs you have to wonder if gobbling up other companies is better than letting them fold up. For instance would DFI still be in the game had they purchased Abit or Soltek before they folded?

As the global motherboard market has been seeing weak growth since 2005, Asustek Computer reportedly is considering acquisitions to further expand its economic scale in the motherboard market, but the company has refuted the rumors and said that it is seeing stable development of its motherboard business and has no plans for acquisitions or strategic alliances.

Currently, motherboard makers' shipment growths each year are mainly contributed by shipments that were snatched from fellow competitors; therefore, price competition in the motherboard market has never ceased with first-tier players such as Asustek and Gigabyte Technology which have larger resources, gaining market share from smaller players such as Micro-Star International (MSI), Elitegroup Computer System (ECS), ASRock and Biostar.

Price and margins are what keep these companies afloat and the retail sector is not where they make their money. Money is made in volume or by creating one off models that fill a niche market with no competition.