Our reporter Sun Wen.
"HTC will not seek reconciliation with Apple."
The smoke of Apple's and Samsung's patents has not yet dispersed, and Wang Xuehong, the chairman of HTC in Taiwan Province, China, responded immediately.
This "the most powerful woman in the global science and technology field" is very confident in suing Apple. She thinks HTC is very old in innovation. Even if the US jury decides that Samsung will compensate Apple for $65.438 billion, it does not mean the collapse of the entire Android camp.
Since its birth, HTC has only been manufacturing mobile terminals for companies such as Google for most of the time. However, it began to cultivate its own HTC brand in 2006, and grew into the fifth largest smartphone manufacturer in the world in the following five years. Once won the top spot in the US smartphone market, HTC was once synonymous with Android products. Wang Xuehong is called "the female version of Jobs".
The nightmare suddenly turned into a surprise. After five years of rapid growth, the net profit of HTC 20 1 1 in the fourth quarter was about $364 million, down 26% year-on-year. HTC also warned that it may drop even more by the end of this year.
Some analysts believe that HTC has released too many mobile phones, which is completely different from Apple's policy of releasing only one mobile phone for a while, but it still intends to continue to produce a variety of terminals tailored for different markets and different consumer groups. According to the data of NPD Group, a market research organization, Apple has embezzled most of HTC's market share in the Sprint network by opening the iPhone to the network operator Sprint. Not only that, Samsung, Motorola and other competitors also cling to product features, which has formed a double attack on HTC business from the aspects of quality and price.
HTC fell back to the hard floor from the clouds.
The crisis is not over yet. HTC's financial report in the second quarter of this year showed that its net profit fell to $247.7 million, down 57.8% compared with the same period of last year, and its market value shrank by more than half.
Is it too risky for Wang Xuehong to challenge Apple at this time?
Don't worry, there is some good news. HTC still has a lot of cash and no debt. Although the company's profits and income fell sharply year-on-year, it still achieved profitability. In the mobile phone industry, apart from Apple and Samsung, HTC is the only company that has achieved this goal. This is enough to give Wang Xuehong some confidence.
The good omen is more than that. As a global company, HTC is regaining its determination to admit its mistakes. According to media reports, in a memo from HTC CEO Zhou Yongming, "HTC has admitted that HTC used to be a fast-growing and responsive company. But this rapid growth momentum has begun to slow down in the past two years. "
Ren Weiguang, president of HTC China, told China Economic and Information Daily: "Apple and Samsung are our main competitors. Apple, compared with a single product, one model dominates the world, and we will not take them as a benchmark. Samsung is more successful and has many models. " He said that HTC is a bit in the direction of Apple, and each selected price segment has a product, which is what they call the boutique route.
Now, HTC is making a comeback with two new mobile phones.
New products buffet
Different from before, HTC's new mobile phone is equipped with Microsoft Windows Phone 8 operating system-HTC Windows Phone 8x and HTC Windows Phone 8S for the first time. The release of HTC 8X and 8S means that HTC has become the third mobile phone manufacturer to officially launch Windows Phone 8 products after Samsung and Nokia.
Steve ballmer, CEO of Microsoft, said that the launch of these two devices was a milestone for both Microsoft and HTC. They are the first batch of most representative Windows mobile phones, and 8X itself is the real hero in Windows mobile phones.
The release time of the new product is very delicate. A week before the release of the new HTC machine, Apple just launched the iPhone 5. Before long, Samsung's new machine will also be listed soon.
It seems that the change of HTC has not stopped in the war of words.
Obviously, Wang Xuehong has said in public more than once that HTC will reduce the release of new machines in the future and stick to the boutique route. This coincides with the previous analyst's point of view, and also increases the public's imagination of HTC's future.
A series is the first batch of products of the boutique route planned by HTC. HTC put all its resources into the One brand, hoping to strengthen the brand image with the help of One, instead of dispersing resources as before. 16GB HTC One X costs only over 3,000 yuan, but it is an Android smartphone with an ultra-fast quad-core processor.
One series may have a natural teacher: Samsung's furious series. Samsung positioned it as a flagship smartphone, which is currently selling well all over the world and even began to seize Apple's share. It should be noted that the Geshi series developed for three generations before it finally became a hot-selling product. Historically, HTC is not a patient company.
In addition, the One series has encountered new problems in the American market. At&T (AT&T), as the representative of several major communication companies in the United States, only sells One model of the ONE series. This means that if you want to buy One series mobile phones, you must specify a fixed telecom operator or buy an expensive lock-free version. Despite some problems, One X performed better than expected. This shows that the boutique route chosen by HTC is playing a role.
The problem is that for mobile phone users, the function is only a part of choosing a mobile phone, and more importantly, the user experience, which means that every detail is crucial. At present, the battery performance of HTC mobile phone is average, and the battery life is not strong, and the appearance of HTC is hard to impress people, which is still far from Apple and Samsung.
Ren Weiguang said: "HTC launched a lot fewer models in 20 12 than in 20 10, and this strategy is still successful. If we only look at the One series and compare the products produced by HTC for so many years, one is the highest in our history with 100 days after listing as the calculation unit. " He said that in the past, this "sea tactics" had its historical reasons, but if they continue like this, they will be mixed into the torrent of Android.
Chen Yuping, a senior researcher at China Telecom Research Institute, told China Economic and Information Daily: "HTC is simple in style and slow to update. Compared with mobile phone manufacturers with strong design capabilities such as Samsung, there are some disadvantages. " Zhang, who has been selling mobile phones in Dinghao Mall for many years, also said: "There are many differences in the prices of HTC mobile phones, but there is almost no difference in appearance, which also causes some aesthetic fatigue to consumers. Many consumers attach great importance to appearance when shopping, and then they often choose other brands. "
Now, no one knows whether these two new mobile phones released by HTC can arouse public excitement. However, at least from the appearance, the new model has indeed subverted the traditional image before HTC.
Win in Android
HTC actually made a good start.
In 2006, when HTC launched its first self-owned brand mobile phone in Asia, it invited a dance troupe to tell the story of HTC's rapid growth from a small-scale foundry company to a leader in the smart phone market. When the troupe brought Zhou Yongming to the stage, the man who later sold HTC mobile phones to the global market looked a little shy.
That's understandable. Prior to this, HTC was only a handheld device manufacturer based on Microsoft operating system Windows CE, and helped brands such as Compaq, Hewlett-Packard, Sony and Palm to contract. During this period, the mobile device business gradually began to rise. HTC wants to make a strategic transformation, but in 2006, BenQ Group, a famous enterprise in Taiwan Province Province, China, got into trouble after acquiring Siemens mobile equipment business. This case really makes the public less optimistic about the future of HTC.
The most intuitive thing is that after HTC announced that it would shift its core strategy to shape its own brand, its share price went down or even fell.
Even more frightening is that HTC has to face a super rival in the field of smart phones. On June 9, 2007, Apple Computer Company officially changed its name to Apple, and then the iPhone was officially released. There is only one company that can compete with Apple's iOS mobile operating system, Google's Android.
In 2008, HTC launched the first Android phone on the market. Unfortunately, only 1 1 10,000 units were sold one year later, which was far from Nokia at that time, and the sales volume was only half that of iPhone. However, thanks to the earliest adoption of Android system and rounded corner design, HTC smartphones have finally become a smash hit. In 20 10, HTC*** sold 25 million mobile phones, with revenue increasing by 90% year-on-year to $9.4 billion, and pre-tax profit increasing by 76% to/kloc-0.5 billion.
It was the best day for HTC. 20 1 1 On April 6, 2008, the market value of HTC exceeded 33.5 billion US dollars, surpassing Nokia to become the second largest smartphone manufacturer in the world for the first time. In June of the same year165438+1October, HTC surpassed Samsung, Apple and Blackberry manufacturers and took the first place in the US smart phone market. This mobile phone manufacturer under the banner of "modesty and Excellence" quickly stood out and became a big winner in the smart phone competition.
At this time, Zhou Yongming was no longer shy. He said: "20 10 is our turning point. We have developed from a small company to a company with a certain scale. This process is much faster than I expected. "
Xiang Ligang, CEO of Feixiang.com, told China Economic and Information News: "The rise of HTC has its particularity. First of all, when HTC first started to make mobile phones, it had a clear definition, that is, it only made smart phones, which made it at the forefront of the industry in many cases. As it happens, many other mobile phone manufacturers have not seen this market clearly, such as Motorola and Nokia. This gives HTC the opportunity to rise. "
The good times didn't last long. Since the fourth quarter of 20 1 1, HTC's global performance has declined for three consecutive quarters. The performance in China market is also not optimistic. In the fourth quarter of 20 1 1, HTC's net profit decreased by about 26% year-on-year, and in the first quarter of 20 12, its net profit decreased by about 70% year-on-year. On July 6, 20 12, HTC issued a statement saying that the unaudited net profit in the second quarter of fiscal year 20 12 was NT$ 7.4 billion, down about 58% year-on-year. HTC said that the main reasons for the decline in performance were fierce market competition and the global economic slowdown.
These disappointing performance figures clearly show that HTC is in the downward channel. In a short time, I haven't seen the possibility of HTC turning around. According to its official forecast, the revenue of 20 12 in the third quarter will be between $2.34 billion and $2.7 billion; Compared with the second quarter, the gross profit margin in the third quarter will shrink from 27% to 25%, and the operating profit margin will shrink from 9% to 7%.
With the continuous upgrading of operating system and repeated innovation of hardware configuration, smart phones are welcoming the era of high-speed upgrade. However, HTC is facing the dilemma of serious decline in sales performance. If effective measures are not taken to save the market in the future, HTC is likely to be gradually marginalized.
The mystery of decline
It must be admitted that HTC's success benefits from its multi-brand strategy. 20 1 1 In the fourth quarter, HTC sold 5 1 mobile phones simultaneously in the US market. However, although the "sea tactics" are beneficial for HTC to increase its market share, the rapid upgrading of mobile phones also makes it difficult for consumers to remember individual products, so it is difficult to create star products. What's more, many HTC products have separate names, from early dreams and heroes to current Ryhme and desires. In less than two months, Samsung Galaxy S III sold more than 6.5438+million units, and Galaxy S sold more than 50 million units worldwide.
Although Wang Xuehong and Zhou Yongming don't agree with the media's label of "sea tactics", Wang Xuehong also admitted that the operation modes of various products really hurt HTC.
Apple's success confirmed the correctness of the boutique route. Starting from the Galaxy series, Samsung turned to Apple's single brand strategy, that is, there is only one brand, and then it is divided into high, medium and low-priced models under this series. Facts have proved that consumers are not so fond of the new and tired of the old. On the contrary, they are extremely keen on classic brands and star products, which has become a fashion pursued by the whole people. Behind classic brands and star products is the support of excellent brand image and perfect user experience. This is exactly what HTC lacks.
For HTC, the lack of core technology is a thorn in the throat. Due to the lack of independent core technology, HTC must rely on resource integration and cooperation. At the beginning, HTC keenly captured the opportunity of Android and became the leader of smart phones. However, when big manufacturers join the Android camp, the decline in sales is an inevitable result.
It should be noted that most of the core technologies controlled by HTC now focus on the level of user experience, rather than operating system and chip technology. Google holds the core technology of Android system. Every time HTC sells an Android phone, it needs to pay some patent fees to Google. HTC chips are in short supply, so we have to rely on big companies such as Qualcomm. Even the parts are not completely under the control of HTC. Many mobile phones of HTC use Samsung's screen. Once there is a shortage of Samsung screens, HTC will not have enough production capacity to supplement the supply.
He Guili, director of China Thiel Laboratory, told China Economy and Informatization: "HTC lacks core technology, but the bigger problem is that it has no core competitiveness. For example, Samsung's mobile phone display is its core competitiveness. In the field of mobile phone display, Samsung must control other rivals. Large enterprises are sensitive to this aspect. "
Insufficient patent accumulation has also dragged down HTC. In 2009, a company named IPcom filed a lawsuit in a German court, demanding that HTC mobile phones be banned from being sold in Germany. The end result is that an HTC mobile phone is no longer sold in Germany. 201119 The United States International Trade Commission (ITC) ruled that HTC was prohibited from selling some smartphones that infringed Apple's patents, and the ban came into effect on April 20 1219.
Although the incident has basically reached a settlement, it has delayed the time to market of new products such as HTC One X and Evo 4LTE for about half a month. Coupled with the European debt crisis and the downturn in the US market, HTC's sales in Europe and the US market were lower than expected.
In June this year, Nokia filed a complaint with ITC, accusing HTC of infringing its patents on smartphones, tablets and their parts sold in the US market. ITC announced a "337 investigation" on HTC, involving HTC Corporation and HTC USA. The purpose of filing patent lawsuits by companies such as Apple is not only infringement compensation, but more importantly, HTC is excluded from the market, thus avoiding the competition it brings.
Even more frightening is that HTC's competitors in the global market are far from an order of magnitude. The strong competition between Apple and Samsung, especially the release of iPhone 4, has seriously impacted the market position of HTC products. In the second quarter of this year, Samsung shipped 90.43 million electronic mobile phones, and its share in the global mobile phone market rose to 2 1.6%, further consolidating its position as a leader in the mobile phone market. HTC dropped to 13.7% from 10/5% in last year. Apple, Samsung and Nokia all have strong strength and deep background, and have long-term and stable market share. Apple's soft and hard integration model and Samsung's vertical industrial chain model are not easy to go.
In contrast, HTC is a young China brand, and its company started as an OEM. Although it once occupied a large market share, it seems that it cannot compete with Apple unilaterally. In Xiang Ligang's view: "The reason why HTC has experienced such a sharp decline is that it has been squeezed by the iPhone and Samsung's furious series. In the cracks, HTC products do not have their own characteristics, so they are passive. "
In China, the world's largest mobile phone market, it is not much better. HTC, which adheres to the mid-to-high-end strategy, has fallen into an embarrassing situation of "high is not enough, low is not enough". Previously, HTC has been focusing on the European and American markets, ignoring China, the world's largest smartphone market. It was not until 20 10 that smartphones were sold in the mainland under the HTC brand.
Wang Ying, senior analyst of Analysys International, told China Economic and Information News: "HTC's market share in Chinese mainland has not been high. It has been around 3% since entering the mainland market, and there has not been much change. " Given that HTC is a company in Taiwan Province province, China, this decision is really hard to understand.
Embarrassed, in the eyes of ordinary consumers, Samsung and Apple's products are representatives of high-end products, and most of them are unwilling to pay for HTC's high pricing. In the eyes of high-end users, it is better to buy products from Apple and Samsung at the same price. Because HTC has a certain gap in both experience and product quality. For low-end users, HTC has no price advantage compared with domestic brands such as Huawei and ZTE. However, if brands such as Huawei and ZTE launch smart phones of around 1,000 yuan, HTC also said that it can't afford to lose in cost.
The result can be imagined. Chen Yuping said: "HTC didn't play the domestic mobile phone card. In the eyes of consumers, domestic mobile phones are generally concentrated in the low-end field, with relatively high cost performance. Compared with these mobile phones, HTC is very competitive. " Xiang Ligang believes that HTC is insensitive to market changes, and there is room for high-end products and low-end products in the mobile phone market. At present, low-end mobile phone manufacturers have made smart phones at a price of around 1,000 yuan or even lower, so HTC has basically lost its right to speak in this market.
In fact, HTC has also had a bad experience. HTC expanded the Chinese mainland market through OEM in dopod, resulting in the coexistence and competition of parallel HTC and dopod brands. Until now, many consumers are still used to buying parallel HTC mobile phones. According to ZDC data of Internet Consumer Research Center, 39.8% of HTC mobile phone users buy mobile phones through parallel channels.
Critics believe that HTC did not pay enough attention to the mainland market in the past, and many consumers' impression of HTC still stays in the concept of parallel mobile phones. Wang Ying said: "When HTC first came in, many of them came in through parallel channels. It is very difficult to reverse the views of consumers. " She said that HTC was able to expand rapidly in the past, mainly because it made smart phones earlier and had a large screen. This enables it to quickly seize the gap in the rising market. But now the homogenization of smart phones is more serious, and HTC has no advantage in many aspects, so it will soon decline.
procurement plan
Similar to the way many companies choose to get out of trouble, HTC first thought of the acquisition plan, and now holds a lot of cash.
Zhou Yongming publicly stated on June 5438+ 10 last year that HTC was considering acquiring more media and content companies to accelerate its ambition of making the company one of the most famous smartphone brands in the world. He said: "It is not enough to have leading technology. We must provide a comprehensive experience covering hardware, software and content. What users really care about is the daily experience. "
HTC has acquired a large number of content providers, including Saffron Digital, a British streaming video company, which bought it for 30 million pounds last year, and Onlive, a game company from California, which bought it for 40 million dollars. HTC also invested $ 10000000 to take a stake in KKBox 10%, an online music service provider in Taiwan Province Province. Zhou Yongming said that HTC may launch more acquisitions. But he added: "HTC does not intend to acquire its own operating system through acquisition."
However, HTC's investment in the consumer sector has not achieved fruitful results. HTC recently announced that OnLive has completed an asset restructuring because of "lack of working capital and inability to raise new capital". HTC invested US$ 40 million in OnLive in February of 20 1 1. It is widely believed that this move is intended to introduce more online games for HTC smartphones. OnLive can provide game services for PC users through streaming media, and then start providing games for android tablets and mobile phones at the end of 20 1 1. However, due to the high cost of infrastructure, OnLive was forced to start restructuring, resulting in its inability to achieve profitability. On Friday, OnLive announced that it had been acquired by an undisclosed company, but as part of the restructuring plan, some employees of OnLive had been laid off.
HTC also announced that it will spend 35.4 million US dollars to make a strategic investment in Silicon Valley enterprise application innovation company Magnet Systems (hereinafter referred to as Magnet) and acquire its 17. 1% equity. HTC said in a statement that this investment will help "HTC enhance its capabilities in social, mobile and cloud services for mobile enterprise customers". The platform developed by Magnet will provide HTC with a "perfect application and service platform, which will help attract future corporate customers".
From June 20 10 to June 20110, HTC * * spent NT$ 24 billion to acquire or invest in10 companies such as ADC, an American wireless communication technology manufacturer.
The intention is very obvious. HTC wants to cut into the cloud and software industry from a pure hardware manufacturer, master more patents and gain an advantage in the future competition. However, due to the running-in time after M&A and the rapid changes in the external competitive environment, these investments and acquisitions have not yet integrated with HTC to form a unified competitiveness.
Dean robot
HTC's biggest problem is that its old friend Android and itself have become inseparable.
In the patent litigation between Apple and Samsung, the U.S. District Court for the Northern District of California ruled that Samsung had intentionally infringed a number of Apple patents, and should pay it $65.438+$005 million for damages. A series of disputes will continue, and conclusions will not be drawn too soon.
However, we must be soberly aware that Google may not fully protect manufacturers at critical moments. After all, business is business. There is no doubt that this is a difficult period. HTC needs to get rid of the situation of relying too much on Android, seek a new way out and share possible risks in the future.
Microsoft is ready to go.
From 65438 to 0997, Wang Xuehong founded HTC, mainly engaged in PDA and smart phones. However, HTC soon fell into a huge loss, during which time, Wang Xuehong came into contact with Gates. At first, the founder of Microsoft despises this small factory from Taiwan Province province, China. Later, Wang Xuehong showed Gates the prototype made by HTC, and Gates was surprised that HTC realized his concept. Of course, Gates became Wang Xuehong's friend, and he liked to grin and advertise HTC products.
Wang Xuehong once described it like this: "When Bill Gates saw the smart phone we developed, he said,' You are the greatest hardware company'. He doesn't want to say that we are the greatest company because he takes it for granted that Microsoft is the greatest company. "
In fact, apart from Nokia, HTC can be said to be the staunchest supporter of Microsoft Windows. Windows Phone launched by HTC 2065 438+00 ranks first in the whole industry, and new high-end equipment products are constantly introduced. at at & at； T's International Consumer Electronics Show conference, Zhou Yongming and Microsoft CEO steve ballmer also took the stage together.
He Guili is more optimistic about HTC's Window Phone platform. He said: "HTC's newly released products may be equipped with WP8, which is relatively safe compared with Android and relatively open compared with iOS. Therefore, it combines the advantages of both sides, so it is possible for HTC and even other mobile phone manufacturers to re-emerge using the WP8 platform. "
Now it seems that the cooperation between HTC and Microsoft is a good choice.
Is that really the case? The biggest advantage Microsoft brings to Windows Phone 8 is the same core code as Windows 8, that is, developers only need to write a set of code to make applications run on Windows Phone 8 and Windows 8 at the same time. However, WP8 will not run on all current devices, and the WP7.5 system cannot be directly upgraded to WP8. This makes consumers have low expectations for Microsoft's new products.
Nokia Lumia series may be able to map the shadow of the future HTC WP machine. Lumia doesn't have the feeling it should have in the era of smart phones, and there are very few applications that can be used. Release a very disappointing. The root cause is that Windows Phone 8 system has not captured the hearts of users, and there is no successful platform and ecosystem. After all, you can't be excited by one or two hardware highlights like the applications launched by iOS and Android platforms.
What's more, Samsung and Nokia cooperate with Microsoft. At present, both Samsung and Nokia have released corresponding products earlier than HTC. Although HTC can choose Microsoft because it doesn't want to put eggs in the same basket, if HTC doesn't make a big breakthrough in technology, it will be difficult for it to compete for users from Samsung and Nokia.
It should be noted that it is not easy for HTC to regain its reputation now.
HTC counterattack
HTC's latest move is to implement a new pricing policy in order to seize market share by making use of small profits but quick turnover.
It is worth noting that this new pricing policy is not only applicable to products that have already appeared, but HTC will also adjust the pricing of new mobile phones equipped with Android and Windows Phone 8 systems accordingly.
But to gain a firm foothold and return to its former strength, it is far from enough to rely solely on price reduction. In the current market environment dominated by users' needs, if HTC can put down its posture, lay out the low-end market, cooperate with the three major operators in depth, launch fist products in the high-end market, and customize personalized services for users in software development, it may be able to find rebirth opportunities under the current domestic terminal business melee pattern.
In the mainland market, Samsung and Apple mainly compete for high-end users in product positioning. Because this field is very profitable. Huawei, Lenovo and other mainland brands have put more energy into the thousand yuan market because they want to expand their scale.
Focusing on multiple emerging markets is a wise move for HTC. Although the competition in Chinese mainland market has been fierce, with local brands such as Huawei and ZTE taking the dominant position, HTC has made some progress, and its market share doubled to 6% in the first half of this year. In 20 12, HTC made it clear that it would move to emerging markets, especially the Chinese mainland market, and strive to transform the sales structure that used to be dominated by European and American markets into Western Europe, North America and Asia-Pacific, each accounting for about 30%.
It is not difficult to judge that HTC has to change its marketing strategy.
In 2009, HTC replaced "smart mobile" with "quietly brilliant" and became the company's global marketing strategy slogan. Modesty and Excellence, low-key luxury, this is the deep pursuit of many consumers, and it also indicates the transformation of HTC from OEM to high-end brand. But what is puzzling is that its marketing promotion route has always been a low-key route. However, in order to regain strength in the smart phone market, HTC is preparing to abandon the "modest" style.
Ren Weiguang said, "Under the same operating system, hardware manufacturers must find their own position." He believes that Android is an open platform, and hardware vendors compete for hardware strength. However, under the premise of hardware homogenization, hardware manufacturers must make their differences more prominent. Different configurations will naturally bring different experiences to consumers.
Zhan Sen Mackenzie, president of global sales and marketing of HTC, said that HTC has recently increased its advertising investment, highlighting its brand image through elements such as sound effects, cameras and design. In an interview with the media in new york, Mackenzie said, "We should be bolder and not complacent. We are changing our marketing strategy and communicating directly with users. "
If everything is really like what he said, it really means a lot. I hope this can really become a new chapter for HTC, instead of criticizing it a few years later.