Quite simply, Lenovo is looking for growth. The company is the third-largest PC company in the world, but it doesn't participate in some of the fastest-growing areas of the market, such as consumer notebooks. The ThinkPad business it acquired from IBM sells mainly to businesses, and the Lenovo 3000 line of desktop and notebook PCs are really meant more for small and medium-size businesses.
But consumer PC sales are growing strongly this year, especially in retail and especially among notebooks. And consumer electronics outside of the PC--things like printers, cameras and music players--remain a profitable area of business for companies like Samsung and LG Electronics.
One thing working in Lenovo's favor is that it's already familiar with the consumer business: it's the largest PC company in China, and it already sells a wide range of consumer electronics devices to Chinese consumers. The company has been spending more and more money trying to highlight its brand, building up to the 2008 Beijing Olympics, which analysts expect to serve as a worldwide coming-out party for Lenovo.
"Lenovo has very little brand recognition in the U.S.," said Samir Bhavnani, an analyst with Current Analysis. "If you're trying to build a consumer electronics brand, you have to sell into the U.S."
Lenovo wants to be the next Dell
Posted on Saturday, Apr 07 2007 @ 02:28 CEST by Thomas De Maesschalck