Among the brands that Telstra is catching up with is ZTE, Huewei, Xiaomi, Alcatel One Touch, Xiaomi and Lenovo who will shortly launch their top end Motorola brand up against HTC in the Australian market.
One Australian and two senior Chinese executives have told me that HTC is “up for sale” and that discussions have taken place about a potential acquisition of the Taiwanese Company. One Company mentioned as being interested in HC is TCL who own the Alcatel One Touch and recently acquired the rights to the Palm brand.
At a shareholders meeting in Taipei yesterday where new CEO Cher Wang talked about a new series of devices as well as the Companies declining stock value following what has been described as “an average roll out” of their new HTC One M9 which suffered from software teething problems shortly after its launch in March 2015 despite the device winning applaud from several reviewers.
Wang said HTC’s performance was mainly due to its poor operational efficiency and overly conservative marketing strategy amid fierce competition in the global market.
“HTC’s recent performance has let people down,” Wang said at the company’s annual general meeting.
Wang’s apology came a day after HTC’s stock price dropped below NT$100 to a 12-year low of NT$98. Shares stood as high as NT$1,300 on April 1, 2011.
This year’s HTC flagship One M9 smartphone, which was launched in April, was criticized for lacking differentiation from its previous model, the One M8.
The smartphone also encountered thermal issues causing shipment delays after its sales launch.
In an effort to improve the company’s smartphone segment, HTC’s core business, Wang said the company plans to launch a “hero product” in October, and make significant improvements in innovation and design for the next flagship model next year.
Wang said HTC would reduce its production costs by improving production efficiency as well as optimizing its components supply chain, adding that it would also outsource some orders to increase operational flexibility.
Saying that the marketing budgets of Apple Inc and Samsung Electronics Co are 20 times higher than HTC’s, Wang said the firm must improve its marketing strategies.
HTC does not sell well using conventional marketing strategies, Wang said, adding that it would not renew US actor Robert Downey Jr’s contract after this year.
In an attempt to develop new business, HTC would develop virtual reality applications, such as the HTC Vive virtual reality headset that it developed with US-based game developer Valve, Wang said.
Wang said that the HTC Vive, which was unveiled at the annual World Mobile Congress in Barcelona in March, has been well-received by the market and that the company would focus on virtual reality development.
“I am upbeat about HTC’s outlook. We aim to focus on developing the right products,” Wang said.
The company has not announced a launch date for the Vive.
At an investors’ conference in February, Chang said that HTC hopes the non-smartphone segment can contribute at least 10 percent of the firm’s total revenues next year.
Both ASUS and Acer have also launched new smartphones with ASUS looking to enter the Australian smartphone market with a very clever Selfi smartphone that has a unique stand built into the device.
Sources have told me that the market will not see a direct M9 competitor or replacement this year but there will be new models launched by the last quarter.
During the past few weeks we have seen a few leaked HTC handsets that focus on non-Western markets which is where HTC is holding marketshare, however they are having to compete in these markets up against 15 new Asian smartphone makers hoping to crush HTC as well as Samsung and Apple.
Several of these manufacturers are only selling online, this allows them to significantly lower the cost of a handset.
Taiwan-based mobile company HTC was able to grow its revenue during the fourth quarter, but profits were disappointingly slim.
Back in February 2015, HTC posted revenue of $1.5 billion during the fourth quarter, up 12 percent compared to the same period in 2013 however HTC’s profit was just $15.9 million as the Company invested in new categories and new smartphone models.
One analyst at Computex said that HTC has traditionally sold their products via carriers and that their new wearable, and Virtual Reality goggles coupled with their recent action camera was “very much a retail offering” and this creates problems for HTC in getting their products ranged ahead of some “very tough” competition from the likes of Samsung, Apple, Panasonic and LG who are also expanding into these markets with bigger marketing budgets and “greater” brand awareness.
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