Acer claims the failure of the tablet PC is due to MS's exorbitant licensing fees for XP Tablet Edition OS.

"..."The cost of a tablet PC is $200 (7,000 Taiwan dollars) more than its notebook counterpart. Of this difference, the hardware cost is only between $30 and $60. The majority of the difference comes from the OS license," said Wang. "We have tried to negotiate the fee with Microsoft several times in vain. It's very regrettable."

Note to Acer: MS doesn't care if tablets take off now or not. It will do the same thing with them that it did to the spreadsheet market - slowly but surely add 'features' - proprietary hooks to Windows - that make it difficult to use any other product but tablet PC's with Windows. They've got cash to burn, and plenty of time to spare.