The Homa Files

TakeAway: In a short period of time, HTC has risen from a nameless contract manufacturer to the world’s market leader in Android phones.

With Android sales growing faster than iPhone sales, HTC is well-positioned to grow even more.

Such a position has given HTC more clout, and more profits than it could ever earn as a brandless company.

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Excerpted from Bloomberg Businessweek, “A Former No-Name from Taiwan Builds a Global Brand,” by Bruce Einhorn, October 28, 2010

… HTC, a brand virtually unknown in the U.S. two years ago, is the market leader in Android phones—the one segment of the market that’s growing faster than Apple’s iPhone. …

… with a market cap of 552 billion Taiwan dollars ($18 billion) the company is now the third-most-valuable Taiwanese technology company … HTC launched the first Android smartphone in 2008 … and has a 39 percent share of that market globally. Thanks to the success with Android … analysts expect sales to soar 78 percent this year, according to data compiled by Bloomberg. That’s far better than rivals Apple, Nokia, Research In Motion, and Samsung Electronics. …

HTC is an unlikely Android leader. When the company got its start in 1997, it manufactured personal digital assistants for Compaq. HTC followed the tried-and-true Taiwanese outsourcing formula of designing and manufacturing gadgets for other companies without a brand name of its own. … In 2002 … Microsoft awarded HTC a contract to make smartphones, and the manufacturer quickly became the world’s top producer of Windows phones. …

Even as the Microsoft business was growing, [the CEO] worried that a brandless HTC would forever remain a low-margin manufacturer of commodity products. … In 2007, the year Apple … [HTC] decided to move away from the anonymous contract-manufacturing business. Last year, HTC spent $100 million on a fourth-quarter marketing blitz, and … will spend up to $400 million this year. The company is now the world’s fourth-largest smartphone manufacturer after Nokia, RIM, and Apple, according to IDC.

HTC’s rise to the top tier of handset makers has given it more clout with partners … [and] wireless operators are more willing than before to work with HTC on technology and marketing plans. …

Edit by DMG

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Full Article
http://www.businessweek.com/magazine/content/10_45/b4202037166312.htm?chan=rss_topStories_ssi_5

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This entry was posted on December 17, 2010 at 6:40 am and is filed under Mktg - Brands, Mktg - Product & Innovation. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.