For years, HTC has built its reputation and its success on the Windows Mobile platform. At one point, nearly 90% of all Windows Mobile phones on the market were manufactured by HTC. Late last year, HTC branched off from producing only Windows Mobile handsets with the introduction of the HTC Dream with Google Android OS. Since then, HTC has seen great success with the Android platform and is now planning on shifting nearly 50% of their 2010 handset production to Android powered devices. But many people are a little confused about a new handset that popped up on the net a few days ago. The new HTC Touch.B was initially rumored to be running on Android, but now it turns out that it actually will be running on Qualcomm’s new BrewMP.
We first heard about HTC’s plans to introduce a BrewMP handset earlier this year. If you were like us, you might have read the news story and simply moved on. After all, if you’re an HTC fan you most likely don’t care about “dumb phones” since everything that HTC puts out is typically cutting edge technology. So why would HTC even think about producing handset that wouldn’t get a second look from you or me?
Over the past four years, HTC sales have grown from $2.2 billion in 2005 to $4.6 billion in 2008. Profit margins are right about 30% since HTC runs a pretty lean ship. Unfortunately, the financial crunch has taken its toll on HTC as well. Sale for 2009 are up for HTC handsets, but the company is expecting to see a 5% dip in revenue due to increased competition in the marketplace. HTC desperately needs to find another role in the handset marketplace in order to maintain their profit margins and continue to grow their business.
Samsung just announced that they have just sold their 50 millionth touch-screen handset. When you compare those sales figures to those of HTC, you might wonder how HTC is even in business. To achieve this goal, Samsung has been building a variety of different touch-screen phones with the same TouchWiz UI so that they completely saturate the market and have handsets on all the carriers. The real kicker is that many of their touch-screen phones are “dumb phones” and sell for less than $100 or are completely free with a new contract.
Enter the new HTC Touch.B with BrewMP. If HTC produces as attractive touch-screen handset with an intuitive and friendly UI they should be able to sell millions of units if they can get the price point right. I’m sure a lot of people are wondering why HTC didn’t simply use Android since it is a free and open OS. Android would be a good choice for the Touch.B and I’m sure we all would love to have a nice little Android phone that doesn’t break the bank. Unfortunately a cheap Android phone would only hurt HTC and their reputation. The Android platform has been about for just over a year, but it has already positioned itself as the main competitor to the iPhone. You want an android phone to do everything. With BrewMP, HTC can create a feature phone and leave out some of the more expensive hardware components without making anyone angry. This will allow HTC to sell the handsets for dirt cheap while maintaining a healthy profit margin.
At this point it’s still a waiting game to see what HTC can do with BrewMP. HTC has not indicated how many resources they will dedicate to BrewMP or what their sales expectations are. What are your thoughts? Should HTC be focusing on products for the mass market? Should HTC simply focus on Android and Windows Mobile? Let us know.
