The Washington Post

HTC to return to low-end phones to counter flagging sales

The HTC Corp. logo is imprinted on the back of the company's HTC J One HTL22 smartphone during the unveiling event in Tokyo, Japan, on Monday, May 20, 2013. (Kiyoshi Ota/BLOOMBERG)

Sometimes, it seems, having a good smartphone just isn’t good enough. HTC said Monday that it will return its focus to the low end of the smartphone market, adding to evidence that all is not well in the premium smartphone market.

For consumers looking at buying smartphones in the next year or so, that likely means more plastic-backed phones at lower prices of around $150 to $200, rather than the $600 price tag of the company’s flagship HTC One.

The move adds more weight to the warnings that have come from Apple and Samsung that the market for high-end, high-profit smartphones is due for a slowdown as the main markets for expensive smartphones hit their saturation point.

It’s a telling reversal from HTC, which said two years ago that it would shift from making a broad range of phones with a wide range of prices to focusing on fewer, higher-quality products. That strategy has failed the company, which indicated last year that it would broaden that focus to mid-tier phones as well.

The effort produced the strong HTC One line — well-reviewed smartphones that never managed to get the sales that they needed to compete with Apple and Samsung. According to the analysis firm IDC, HTC was not even in the top five mobile phone vendors for 2013; it lagged not only behind Samsung and Apple, but also Huawei, LG and Lenovo.

HTC reported a small profit of $10 million in the last quarter of 2013, but even that missed analyst expectations of about $12 billion. In a statement, HTC chief executive Peter Chou said that the company hopes to recover some of its fortunes with a focus on making a “compelling mid-range portfolio” and by improving communications with its customers.

The low-end of the smartphone market is where analysts project the greatest growth will be in the coming years. If HTC can duplicate the early success it had with making Android phones for the U.S. in Asia and Eastern Europe, for example, the strategy may help its flagging sales. But it’s also going to be tough for the company to play in, however, especially as two of the firms that pushed it out of the world’s top five are ones intensely focused on making cheap smartphones: Huawei and Lenovo, which recently agreed to buy Motorola Mobility from Google in its own effort to ramp up smartphone production.

Related stories:

Apple shares fall on flat earnings report, as firm warns of a revenue slowdown ahead

Samsung Galaxy S5: Rumor roundup

Follow The Post’s new tech blog, The Switch, where technology and policy connect.

Hayley Tsukayama covers consumer technology for The Washington Post.



Success! Check your inbox for details. You might also like:

Please enter a valid email address

See all newsletters

Show Comments
Most Read



Success! Check your inbox for details.

See all newsletters

Your Three. Videos curated for you.
Play Videos
This isn't your daddy's gun club
A look inside the world of Candomblé
It's in the details: Five ways to enhance your kitchen makeover
Play Videos
A fighter pilot helmet with 360 degrees of sky
The rise and fall of baseball cards
Is fencing the answer to brain health?
Play Videos
John Lewis, 'Marv the Barb' and the politics of barber shops
How to prevent 'e-barrassment'
The art of tortilla-making
Play Videos
Circus nuns: These sisters are no act
How hackers can control your car from miles away
How the new credit card chip makes purchases more secure

To keep reading, please enter your email address.

You’ll also receive from The Washington Post:
  • A free 6-week digital subscription
  • Our daily newsletter in your inbox

Please enter a valid email address

I have read and agree to the Terms of Service and Privacy Policy.

Please indicate agreement.

Thank you.

Check your inbox. We’ve sent an email explaining how to set up an account and activate your free digital subscription.