Although some upstream supply chain players do not think notebook ODMs should join the entry-level tablet competition because of profitability concerns, it seems a neccessary step that ODM must take in order to stay competitive in the PC market.
For the ODMs, landing entry-level orders means a lot more than just revenues and profits; it is an important move to maintain their relationships with the brand partners.
Since good relationships mean clients will continue releasing orders in the future, most ODMs are aggressively trying to get involved in the brand vendors' new projects. If the cooperation goes well, the ODMs will also receive orders for new products from the clients.
The entry-level tablet orders can also help promote the ODMs' non-manufacturing business, such as Quanta Computer's cloud computing platform and Wistron's after-sales service.
As more brand vendors will enter the entry-level tablet market in the future, the benefits from the slim-profit business will only grow stronger and send ODMs making even more aggressive moves.