Despite dismal results, HTC sticking with high-end smartphone strategy

Brad Reed
Despite making killer phones, HTC has been an ungodly mess for the past two years

To say that things have gone poorly for HTC in 2013 so far would be an understatement: The company released one of the year’s best smartphones but has nonetheless gotten clobbered by Apple and Samsung, which both continued to dominate the high-end smartphone market. Meanwhile, low-cost Chinese Android vendors kept pumping out devices that had respectable specifications at rock-bottom prices. Since HTC lacks the advertising clout of Apple and Samsung, many observers assumed that it would make a strategic shift to release more low-cost devices that would appeal to consumers in emerging markets.

It seems, however, that HTC plans to keep banging its head against the wall by sticking with a strategy that has been a proven failure. In an interview with CNET UK, HTC marketing chief Jeff Gordon said that “HTC will not suddenly shift strategy to become a budget smartphone maker” since “competing against Huawei, ZTE, and eventually Amazon, for low-end, razor-thin margins is a fool’s game.”

While it’s true that the low-end Android market is brutal, zero-margin affair, it’s clear that sticking only with high-end Android phones is not doing HTC a lot of good. Given how saturated the high-end smartphone market is right now and how well Apple and Samsung rank in customer satisfaction surveys, it’s difficult to see HTC breaking through no matter how many Robert Downey, Jr. ads it runs.

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