HTC Continues to Struggle in Smartphone Race

by Matt Klassen on August 8, 2012

While mobile manufacturer HTC is experiencing a brief renaissance of sorts throughout Asia, the once strong Android partner is quickly slipping into irrelevance in the North American market, according to an article in the E-Commerce Times.

Its early innovation with Google’s Android platform established HTC as a smartphone leader several years ago, but much like other big names in the mobile market like RIM and Nokia, the Taiwanese company simply failed to continue to innovate, watching its mobile momentum come to a grinding halt. In fact, while new HTC releases are finding some success in China, here in North American the company has simply not been able to compete with the likes of Samsung and Apple.

The result of this stagnation was another disappointing quarterly report that saw a dramatic drop in HTC’s revenues compared to last year, and looking forward, it doesn’t look like anything is about to change.

“HTC gained a lot of momentum because it gambled early on Android, and because its Sense user interface was a pretty big improvement on the UI Google packaged with its operating system,” GigaOm Pro’s Colin Gibbs explained in a recent interview with E-Commerce Times. “But it didn’t build on that head start by continuing to innovate with that user interface.”

Recently HTC has tried to remedy this problem, launching new lines like the HTC One series, the Desire series, the EVO 4G LTE and the Droid Incredibly 4G LTE, as well as unveiling the company’s new digital content program called “HTC Connect,” but so far these efforts have been for not.

That said, however, the company’s Desire V series launched in China recently has had experienced a great deal of success, but as everyone in the mobile market knows, the really measure of success still remains the North American market. As Gibbs notes, the smartphone market is a cutthroat business, and if you’re not providing your customers with cutting edge technology and upgrades on regular intervals, you’re going to lose ground fast.

While this most recent quarterly report and the forecast for the next quarter are certainly gloomy, this wasn’t the start of HTC’s downward slide. In a piece I wrote late last year I compared HTC’s struggles to those of Nokia and RIM, noting that in all three cases the key factor was stagnation, a lack of innovation.

“[HTC’s] industrial design hasn’t changed for almost two years. Unless it launches a really different phone, it’s hard to sell the product at a premium price,” said Roxy Wong, analyst at Mirae Asset Management in Hong Kong.

In the end, there is certainly a chance that HTC could reverse its flagging fortunes and regain lost ground to Samsung and Apple in the North American market, but in all the cases of market stagnation that I’ve seen it’s rarely happened. For HTC to succeed it’s going to take a total rethink, a reinvention of its brand, its devices, and its image. Most of all, I’ve found, such a turn around takes humility, acknowledging the failure to innovate…something almost impossible to achieve for mobile companies who have already tasted the sweet apple of success.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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