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Asus to put Windows XP on two-thirds of Eee PCs
New models to sell for around $400

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Published: Friday 14 March 2008

Asus has revealed nearly two-thirds of Eee PCs shipped this year will be Windows-based as consumers embrace the company's low-cost laptop models.

The Taiwan company's branded business last year launched a seven inch child-friendly Linux-based personal computer priced as low as $200, and new models with Microsoft's Windows XP will be priced around $390 to $400.

"About 60 per cent of [the Eee PCs] will have Windows XP operating system," Asus chairman Jonney Shih said at a news conference.

The Eee PC has won Asus much recognition worldwide and Shih said his company was keeping its previous target of shipping five million units this year versus 300,000 units shipped in 2007.

Sales have been the strongest in Europe, followed by Asia Pacific and China, said Lillian Lin, Asus' head of marketing.

"There is a huge untapped computer market out there, and we want to get into the next 10 billion consumer market [with these lower cost computers]," said Davis Tsai, president of Microsoft Taiwan.

Industry analysts said the move would be beneficial to the Taiwan company, and Windows' software prices on low-cost models should be cheaper than that of the operating systems used on mainstream notebooks.

"A Windows Eee PC is more attractive to buyers because people are just not used to using Linux-based computers," said Alvin Kwock, analyst at JP Morgan.

Worth around $8.5bn, Asus separated this year its branded business from its contract manufacturing operations, which make laptops for Apple, Dell, HP and Lenovo.

Separately, Shih said Asus was considering moving some of the firm's contract manufacturing facilities to Vietnam, following other larger contract manufacturers like Compal Electronics and Hon Hai Precision Industry.

He did not give a specific time frame or investment figure.

Asus competes with Acer in own-brand laptops and with Hon Hai Precision Industry and Quanta Computer in its contract manufacturing operations.