Thursday, July 27, 2006

HTC Steps Out of the Shadows

Unstrung looks at High Tech Computer Corp. (HTC), which "will step out of the shadows soon with a smartphone produced under its own name. The Taiwanese ODM (original device manufacturer) is expected to deliver another Microsoft (MSFT) Windows-based smartphone with a QWERTY-keyboard -- a sector that is becoming increasingly crowded with recent devices from the likes of Motorola (MOT) and Palm (PALM)"

Jack Gold at J.Gold Associates said, "HTC makes pretty much everyone’s Microsoft-based smartphones. They now want to put their own label on the phone and move from an ODM to a name-brand label. I’d expect them to take what they learned from working with all the other vendors -- e.g., HP -- and produce a phone with a keyboard that looks somewhat like a Q."

Todd Kort, at Gartner wondered "how the move might alter HTC's relationships with its current customers." He said, "This could backfire on HTC and cause many licensees to begin looking elsewhere for an ODM and perhaps even look toward Linux with their consumer-oriented designs. I don’t think Microsoft can be happy about this prospect."

Kort added, "[If] I were at HP, Dell, etc., why would I want to give my business to a company that is competing directly against me? I think some of the guys at HTC were unsatisfied with being the premier device ODM and they let their egos get in the way of common sense."