TAIPEI, Taiwan — Chu Xiang-sheng, Chairperson of Hua Nan Securities Investment Management, commented on HTC's return to ODM business, he suggested that resources are critical for HTC.
Following an eight-year hiatus from the sector, HTC CEO and President Peter Chou recently announced the company's bid to return to the original design manufacturing (ODM) market in addition to its pursuits toward building a distinctive handset brand.
Relatively, a forthcoming HTC-made device for Google's Nexus series of tablets may mark HTC's return to the ODM business.
Chu Xiang-sheng said that resources are critical, only with the resources can do the marketing, and to do better research and design. “HTC sold 20 million smartphones a year, this amount is too small to achieve the economies of scale. In high-end battle field, HTC can't compete either with Apple or Samsung, most notably Samsung manufactures key components like panel, DRAM, NAND Flash, etc.”
“HTC do have the mid-tier smartphone series, but Xiaomi, Lenovo, ZTE, Huawei are already dominated the market, selling 40 to 70 million smartphones, respectively. HTC also can't compete with them, it's hard to achieve the economies of scale, as well.” Chu Xiang-sheng said.
Chu Xiang-sheng pointed out that currently HTC chose to return to the ODM market for a forthcoming HTC-made device for Google's Nexus series of tablets, its shipment maybe will be limited, but since both sides are closed in ODM business that helps HTC to take over the Android source core in a bid of software development.
“We all know that HTC's smartphones are good, however, without marketing it won't leave any impression to customers. With the limited resources HTC is going to rely on fast software applications in this period of time when the smartphone market is almost no differentiation.”
In conclusion, Chu Xiang-sheng emphasized that resources are critical for HTC.
