HTC has sold off part of its R&D workforce to Google in an attempt to right the ship – so the $1.1 billion deal won’t hurt there. The cash injection will keep the lights on at HTC in its original form and help keep the dream alive for a little while longer – far better than what happened to Nokia when it was struggling.
It’s definitely good news for the 20-year-old company and gives it a fighting chance at sticking around for the next 20 years. And who knows – HTC was once a true contender. As Nokia fell during the start of the Android revolution, HTC was making hay.
Around 2010, the company wisely switched from Windows Mobile to Android, bringing out the first phone to market with the new, open source OS. There’s a good chance you or someone you know had an HTC phone that they remember fondly from around this time.
Using the first Android smartphone I owned in 2017
Fast forward a few years and Google is now set to take some 2,000 or so of HTC’s ‘Powered by HTC’ research and development team and make them Googlers, Googlers who will be set on a new hardware mission. What that is we won’t know for some time, but the scope is broad: new smartphones, adding Google Assistant to IoT devices, and so on.
But how did we get here? What went wrong and what went right for the storied Taiwanese manufacturer?
One timeline that tells the story in a graph is the stock valuation of the company – the meteoric rise and catastrophic freefall that might have finally been put on halt:
What went wrong vs what went right
The what went wrong list isn’t a short one, nor is it a new take. As far back as 2012 you can find opinion pieces asking what happened to HTC.
There’s rarely a single smoking gun for any struggling company. Nokia and HTC have their similarities in that they were both squeezed out by the likes of Apple and Samsung.
If you ask HTC, both marketing budgets and slogans are to blame.
If you ask HTC (along with most tech journalists), both marketing budgets and slogans are to blame. ‘Quietly Brilliant’ never hit the mark, while advertising spends weren’t in the ballpark of rivals. And no matter which way you cut it, HTC’s idea of advertising has always been bizarre.
“Samsung spent four to six times more in advertising than us,” said HTC’s president of global sales and marketing at HTC, Jason Mackenzie, back in 2012. (Mackenzie left HTC in January this year.)
But was it marketing, or was it the product?
Hardware: The highs and lows
Credit where it’s due: HTC has released some strong devices over the years, and it consistently got its designs more right than wrong.
But what was once clearly good fell into confusion. HTC put out more than 100 different phones across Android and Windows Mobile from 2009, without a clear way to figure out which were the high-end and which were the low end.
We wrote a nice run-through of every HTC device here; a valiant attempt to keep up with all the releases.
The good times started as early as 2008, the beginning of an upsurge that lifted HTC to being the third-biggest manufacturer globally at one stage.
The HTC Dream (marketed as the T-Mobile G1) was the first Android smartphone to market and while it wasn’t an instant classic, it still marked itself as new, as different, as unmistakably Android.
The HTC Hero in late 2009 was a surprise. While the design was a little strange, it was unique, and had some premium features, including the first ever 3.5mm headphone jack.
2010 was the halcyon year for HTC. They produced their first ever phone for Google with the well-received Google Nexus One, added a home-branded variant with the HTC Desire, and then released perhaps their best complete package with the HTC Legend. The year finished with the HTC EVO 4G which was acclaimed and rated one of the best phones ever made at the time.
As HTC fell, Samsung rose. From similar market share in 2010, by 2012 Samsung was up to 30% with HTC falling to 6%.
2011 might have been the start of the decline. It’s not that HTC phones became terrible or anything. But the branding and design became varied and hard to track. By the end of 2011, the golden run was already over. HTC’s market share fell from a massive 67 percent to just 32 percent.
As HTC fell, Samsung rose. In 2010, Samsung and HTC had roughly the same share of the smartphone market at just over 7 percent. By 2011, Samsung was up to 19 percent, with HTC growing only to 8.8 percent. In 2012, Samsung was up to 30.3 percent, with HTC falling to 6 percent. This was a trend that was only set to continue.
2011 saw HTC release close to two dozen phones, with 12 more in 2012, featuring names that included Desire, ChaCha, Rhyme, Salsa, Incredible, Sensation …and, unfortunately, many more. Speedy. Pyramid. Shooter. None of these made any sense and few were fashionable.
HTC also had dismal luck in partnering with Facebook. The HTC ChaCha was a Facebook-centric Android phone. With a Facebook button. It flopped.
Undeterred, HTC and Facebook worked on the HTC First (or ‘Facebook phone’) which showcased the Facebook Home overlay. If the HTC ChaCha flopped, the HTC First was immediately launched on life-support. AT&T launched it as an exclusive, and after a pitiful 15,000 nationwide sales in the first month, discontinued sales of it almost immediately.
2011 also saw the 7-inch Flyer tablet struggle to sell, HTC’s only dip into the tablet market.
Meanwhile, Samsung was releasing the S and S2 smartphones to great acclaim, with bigger sales budgets, and much better sales.
2012 should’ve been a good year, with the launch of the critically-acclaimed HTC One series, starting with the premium One X with a stunning display. The One S was a quality mid-ranger and the V filled the low-end. But the One X had a cheaper feeling polycarbonate body than the Galaxy S’ all-metal body. Each device was also carrier exclusive, only making everything harder for HTC again.
Too many of HTC's phones were well-received, highly-regarded, and given good reviews, but few managed to sell big numbers.
This was the start of an unfortunate set of recurring nightmares for HTC. Too many of their phones were well-received, highly-regarded, and given good reviews, but few managed to sell big numbers.
In later years, we loved the HTC One (M7), regarded as HTC’s best looking phone, and it was still a successful launch for the company, but it couldn’t stop the slide.
The M8 was then hurt by a poor camera experience and while the M9 righted some of the wrongs it didn’t take a big enough step forward and sales fell by a further 50 percent.
The company then launched two arguably better flagships – the One M9 Plus, and the One E9 Plus within six weeks, with mixed availability and more of the same impenetrable branding.
Meanwhile, Samsung was progressing nicely with the S6 and the Note 5, with the market much more able to understand their structured flagship releases. Apple, of course, was leading the way there too.
The same continues to this day. The HTC 10 was a big comeback, receiving a strong 8.7 in our review, but unfortunately it was given an eye-watering price. The only carrier in the US to carry it, T-Mobile, stopped selling it after just three months.
Unfortunately for HTC, by this point the brand had lost the support of carriers.
The latest and greatest HTC U11 earned a big 9 out of 10 in our review, with only a few quibbles. Unfortunately for HTC though, by this point the brand had lost the support of carriers. Only Sprint offered the device – although it could be bought directly through HTC and Amazon online.
Sense UI
Hardware and software were much more important in the early days of “uncultured” Android, with skins and overlays a big part of the experience. Launchers were a big player.
The original HTC Sense, on top of Android, was a winner back in 2009. In those early days, Sense was a great skin, including a funky time and weather widget, and HTC phones offered cool features like USB tethering as well.
As the Android experience improved, slowly at first and then more rapidly, Sense went the other way.
But as the Android experience improved, slowly at first and then more rapidly, Sense went the other way. HTC packed more and more bloat into their skin until around Sense 3.5 in 2011, when finally the company realised stock Android had caught up.
Sense 4.0 was a reset, a new minimal take that worked more closely with stock Android, but by then, HTC was already experiencing a big fall in sales.
There are any number of articles and videos from around that 2010 era advising owners on how to get rid of Sense, or at least stop it from loading. How badly did Sense combine with the HTC branding disaster? It’s unclear, but it didn’t help.
Carriers helped themselves, not HTC
US carriers are notorious for being difficult and rather than push for wider availability, HTC rolled over and allowed exclusivity, a strategy which clearly backfired.
While Samsung was powerful enough to be able to sell a phone like the Galaxy S3 on all four major carriers, HTC’s new flagship phone in 2012, the One X, was only available on AT&T. T-Mobile had the One S, while Sprint had the low-tier One V. Verizon went without.
The iPhone beat their carrier limitations with brand recognition and a good user experience. HTC didn't.
The iPhone’s initial exclusivity with AT&T was planned out by Apple, designed to offer the best data experience possible via AT&T’s GSM network. The iPhone beat their carrier limitations with brand recognition and a good user experience. HTC didn’t.
HTC Vive and VR
Switching away from phones to VR, the verdict is still to come here. Certainly, the HTC Vive is a winner, but the VR ecosystem is still far from mature, as are mass-market sales.
VR was big news in 2016, with the release of the HTC Vive and Oculus Rift in close competition with each other, and PlayStation VR in the mix as well.
The Vive was generally considered the better experience, with some solid sales figures. But VR still hasn’t taken off, and there’s a growing sense that AR will find more use and applications in our lives.
Google did announce it is working with HTC on a standable Daydream VR headset – with no PC, phones, or wires required – but we still don’t have a release date for that yet.
HTC has been pretty upfront that it is betting the farm on VR, but there’s not a big enough market to sustain it. Yet.
New #Daydream standalone headsets from partners like @htcvive won't require a phone or PC. #io17 pic.twitter.com/7TpYPJGEdU
— Google (@Google) May 17, 2017
In a nutshell:
We promised a nutshell, but if the above wasn’t packed down enough, here’s where we’re at.
Back in the day, HTC struggled to capitalize on its early advantages following the decline of Nokia, blowing the lead it had with poor software, confusing phone releases, and a minimal spend on marketing. Things only went from bad to worse after that, even with some great phones in its arsenal.
HTC now finds itself with a trimmed down operation, extra cash in the bank, and a close partner in Google. So things could be worse.
HTC now finds itself with a trimmed down operation, extra cash in the bank, and a close partner in Google. So things could be worse.
Do we need HTC? Undoubtedly. The Android and wider phone ecosystem without the Taiwanese underdog will be poorer.
The problem for HTC is that it isn’t doing enough to grab (the right kind of) attention. Worse than being disliked, people just don’t really care either way. We need a fresh HTC. Maybe $1.1 billion, a streamlined workforce and closer ties to the Google mothership can deliver that. Here’s to change.
from HB APK http://apk.highbroadcast.com/2017/09/htc-in-nutshell-what-went-wrong-and.html
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