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Acer eyes low-end retail

The company's push should increase competition in the sub-$1,000 PC market.

Hoping to chip away at Packard Bell's omnipresence on low-end retail store shelves, Acer America today announced that its computers will soon be available at Circuit City, Sears, and Wal-Mart Stores.

Starting this fall, Acer's Aspire mini-towers and desktops, priced below $1,499, will be available at Sears and Wal-Mart, while the higher-end AcerNote Light and TI Extensa notebooks will be offered at Circuit City.

Acer's push into retail should increase competition in the market for sub-$1,000 PCs. Low-cost PCs from Packard Bell and Compaq Computer have been selling well, according to recent surveys.

Acer's increased visibility could eat further into Packard Bell's sales, which have already been diminishing under pressure from Compaq. In fact, Packard Bell was the only top-five vendor to lose market share in the second quarter, according to Dataquest and International Data Corporation.

Analysts were of mixed opinion, however, as to whether Acer can significantly impact Packard Bell's dominance in the market. Matt Sargent, with Computer Intelligence, was reluctant to say whether the announcement signals anything other than a struggling company looking for a new market:

"They've [Acer] been losing market share for quite some time. I'm glad to see that they're doing something, trying to expand their distribution model," Sargent said. Despite Acer's announcement, he added, "Packard Bell owns this market."

However, Michael Autrey, of Associated Research Services, felt that Acer was making an aggressively smart move into the low-end retail market.

Considering Acer's slumping market share, the announcement is "going to get the attention of a lot of consumers," Autrey said. "Acer's done a lot of good things with their new lineup."

The announcement comes in the midst of a turbulent year for Acer. Last week, Max Wu was named president and CEO, succeeding Ronald Chwang. In July, the company was hit by a lawsuit from Lucent Technology alleging patent infringement.