HTC places smart watch plans on hold as it refines product

HTC is not going to unveil a smart watch anytime in the immediate future, according to company executives. However that doesn't mean the smartphone maker is abandoning an eventual entrance into the wearables market.

"We had originally planned to have a wearable launch in this time frame," Jason Macnkenzie, HTC's president of the Americas, told Re/code this week. "It ended up just not being ready." HTC is planning a media event today in New York City.

CNET reported last month that, according to unnamed sources, HTC is still working on a smart watch and plans to release it in early 2015. Some reports had indicated that HTC had scrapped its plans for a wearable because it felt it couldn't compete in the wearables market, but according to a CNET report the company does think it can stand out from its competitors in wearable. 

HTC is reportedly focused on an eye-catching design for its rumored watch, as well as software enhancements it can make on top of the Google (NASDAQ: GOOG) Android Wear platform. That would follow a path HTC carved in smartphones with its Sense user interface.

An HTC smart watch would compete not just with Android-based watches from Samsung Electronics, LG Electronics, Motorola Mobility and others, but also with the Apple (NASDAQ: AAPL) Watch, which Apple unveiled last month and plans to start selling early next year.

However, Drew Bamford, who leads the HTC Creative Labs team working on wearables, told Re/code that existing wearables leave much to be desired. "We've seen a lot of general purpose wearables come to market," he said. "There's not a strong reason to wear one every day. When we come to market with our product we want to make sure the product has a strong point of view and there is a really compelling reason to strap it on your wrist."

HTC expects to detail its wearables strategy early next year. "We think the strategy we were working on will get us there, but we want to take our time and get it right," Bamford said. "We honestly don't think anyone has gotten it right."

Meanwhile, Mike Woodward, who had led HTC's Emerging Devices unit, told Bloomberg he left the company for a senior role in mobile services at Amazon (NASDAQ: AMZN) within the past 45 days. Woodward came to HTC in the summer of 2012 from AT&T Mobility (NYSE:T), where he was the vice president of AT&T's consumer wireless device and accessory portfolio. Amazon is working with AT&T as the exclusive U.S. partner for its Fire smartphone, which has reportedly struggled to catch fire with consumers.

Last week HTC reported that it earned a $21 million unaudited net profit for the third quarter, well above a $7 million average estimate of 13 analysts polled by Thomson Reuters. In the year-ago period HTC posted a loss of around $98.5 million. However, as Bloomberg noted, revenue in the quarter slipped to around $1.37 billion, missing the company's forecast of $1.37 billion to $1.47 billion and the $1.49 billion average of 19 analyst estimates compiled by Bloomberg. HTC's sales have fallen every quarter since 2011 and have missed estimates 13 consecutive times.

For more:
- see this Re/code article
- see this Bloomberg article

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