NEWS ANALYSIS: HTC is having trouble regaining its footing in the mobile space, despite delivering products that would seem to appeal to customers.
HTC is one of those companies that most technology lovers know about, but few actually care about. Sure, it’s nice to see the company’s new products pop up at Mobile World Congress each year.
And from time to time HTC mobile devices really do deliver something special. But in a mobile market dominated by companies like Apple and Samsung, HTC’s products get lost in the crowd.
Nowhere is that more apparent than in the company’s recently announced financial performance for the three-month period ended March 31. According to the company, its profit hit an all-time low of $2.8 billion, a staggering 98 percent drop compared to the same period last year. Revenue was down 37 percent, and was well below the company’s guidance for the quarter. Meanwhile, the company lost about half its market share between 2011 and 2012, leaving the mobile maker wondering how it can reverse its fall. It also left investors wondering if HTC deserves their support.
Unfortunately, it might not. HTC was once an important, growing company in the mobile space. But now, it’s an after-thought. Despite its recent deal with Facebook, it looks like there is nothing on the horizon that will reverse the company’s fortunes.
These are the reasons why HTC is dying:
1. The brand isn’t there
HTC’s branding leaves much to be desired
. The company was once one of the leading Android handset makers in the business. But now its brand doesn’t carry any weight with smartphone buyers. Any company is in serious trouble if its brand isn’t respected. It means that a company’s products will be ignored even if they are good quality. That seems to be the case with HTC these days.
2. One misstep and that’s all she wrote
HTC had a strong 2010 and part of 2011, but the company lost its footing with some ill-fated devices in late-2011 and 2012. Now, HTC is trying to regain its lost market share with help from products like the One. But so far, consumers and enterprise users have proven unwilling to give some mobile companies a second chance. And HTC appears to be one of those companies.
3. Samsung is too big
Samsung is a serious threat to HTC
. The company is delivering products that aren’t so dissimilar to those from HTC, but because it’s so much bigger than HTC, the Taiwanese company is at the bottom of the heap looking up. Samsung is simply too big and too powerful for HTC to catch up easily.
4. The lawsuits helped Samsung
This might sound odd, but all of the lawsuits between Apple and Samsung seemed to have helped the Android handset maker. After all, both companies have been battling for years over patents, and those stories have been big news. By suing Apple, Samsung legitimized its business. Although HTC is in its own legal struggles, they don’t do anything to help the company from a PR perspective.