HTC plans budget smartphones to improve revenue

Taiwanese smartphone vendor HTC is planning to expand its range of cheaper products to improve revenue and phone market share. The new strategy will assist HTC to compete against Samsung.

The loss making company, which lost considerable market share to local vendors such as Micromax and Karbonn in India, is targeting to enhance market share and revenue from the new move.

Earlier, HTC focused on premium smartphones. But it failed to compete with Samsung, Apple, Sony, etc. in the global smartphone market.

“The problem with us last year was we only concentrated on our flagship. We missed a huge chunk of the mid-tier market,” said co-founder and Chairwoman Cher Wang, speaking to Reuters in New York last week alongside Chialin Chang, HTC’s Chief Financial Officer.

As part of the new strategy, HTC will sell products in the $150 to $300 retail price range for both emerging and developed markets, along with high-end phones which can sell for over $600.

However, HTC won’t get into the very low-end market, Reuters reported.

HTC plans budget phones

Over two years ago, HTC supplied one in every 10 smartphones sold around the world. In 2013 its global market share had fallen to 2 percent. HTC last month reported its second straight quarter of operating losses.

Wang aims to boost smartphone sales this year by improving its marketing, something she said her company didn’t do well in 2013. While the flagship HTC One phone it launched last year attracted rave reviews, these didn’t translate to strong sales: HTC needs a very aggressive campaign to broaden its market beyond tech-savvy 20 to 30-year-olds, the executives said.

Reuters reported that along with an improvement in the mid-tier HTC is also hoping for incremental growth in the high-end phone market this year. The executives said invitations will be sent out in about two weeks for an event where it will announce the successor to the HTC One flagship phone.

More affordable phones should fill a gap in HTC’s range. Of the 53 phones for sale on HTC’s China website, only two models cost less than $150 – the highest-growth price bracket in China, according to research firm IDC. Twenty-one are over $500.

The success of Samsung is due to the availability of smartphones in wide price brackets that attract both premium and low-end users across the world.

With growth in China shifting to cheaper models, posing problems for Apple despite a much-hyped deal with China Mobile, local smartphone maker Huawei Technology lists eight models under the magic $150 threshold. Xiaomi, whose phones sell for between $130 and $410, said it plans to double its sales this year compared to 2013.

editor@telecomlead.com

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