July 18, 2000

Taipei, -- AOpen Inc., a subsidiary of the Acer Group, expects to open its Japan branch by the end of 2000. This will further consolidate the company's market penetration and services, Acer executives of said Tuesday.

The proposed new Japan branch, AOpen Japan, follows the successful establishment of a branch in Shanghai recently.

The Acer Group has two branches in Japan, selling IBM and Acer PCs and related products.

AOpen is now enjoys first and second places in market share for its motherboards and sound cards in Japan, respectively. Sales of CD-ROM drives in Japan are not so promising, as certain key components are still controlled by Japanese counterparts.

Executives of AOpen said that the firm's products have become a successful brand name in Japan. The establishment of a branch in Japan is necessary to further increase the reliability with Japanese distributors, paving the way for sales of its CD-ROM drives in the future.

During the initial development period, the firm will mainly promote sales of traditional PC products. As Japanese manufacturers hold close to 90% of the market, outsiders have difficulty to push their brands in to such a market, executives of AOpen explained.

In a parallel news development, the Acer Group's Zhongshan plant in Guangdong province was announced to start manufacuturing motherboards, CD-ROM drives, and related components by the end of 2000.

AOpen also set up branches in the U.S., the Netherlands, and Germany over the past few years, and will consider establishing an Australian branch if the Japanese venture will turn out to be successful, a spokesman said.