HTC Chairwoman and co-founder Cher Wang has taken over some of the day-to-day duties of CEO Peter Chou so he can focus more on products, in what is being positioned as a temporary move to help the struggling smartphone maker right the ship.
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In a rare joint interview with the Financial Times, Wang and Chou explained the changes, the company's strategy and philosophy and even HTC's position on the wearable computing and tablet markets.
Chou will focus on products and "innovation," while Wang will look after more of the business side of operations, including sales, marketing, logistics and customer service.
"It's a very exciting time right now because there are so many challenges--it is keeping us on tiptoes for the vision," Wang said.
"I have become very focused in the past couple of months. Before that I was too busy," Chou added. "I took on too many things. I need to be more focused on innovation and [the] product portfolio."
HTC recently reported its first quarterly loss since it became a public company in 2002. The Taiwanese smartphone maker reported a net loss of around $101 million for the third quarter, and an operating loss of $119 million. The company said revenue clocked in at just $1.6 billion, down from $2.39 billion in the year-ago period.
Research firm Gartner estimates HTC's global smartphone market share has shrunk to 2.6 percent, down from being one of the top five smartphone makers in the world only a few years ago. Chou said that the difference between HTC and Nokia (NYSE:NOK) and BlackBerry is that sales of its flagship HTC One are performing well, and that it is getting squeezed at other segments. "The market share loss is mostly coming from the mid- and entry-level segment," he said. Chou said he plans to revamp HTC's midrange portfolio.
Chou said HTC will continue working with longtime partner Microsoft (NASDAQ:MSFT) on its Windows Phone devices but admitted that that Windows Phone sales have been "pretty small" for HTC. "First we have to figure out how we do the business side, and how we position a Windows Phone product in the market," he said.
Microsoft has petitioned HTC to support its Windows Phone mobile operating system as a second option on devices already powered by Google's (NASDAQ:GOOG) Android, Bloomberg reported earlier this month, citing unnamed sources. It's unclear if that could extend to tablets, a market which HTC has largely abandoned for now.
"When the [HTC] tablet comes out it will be something nice and disruptive," Wang said. "There are a lot of devices to innovate...Ubiquitous intelligence is not just wearables."
As for wearables such as smart watches--where Samsung electronics has made a first stab with its Galaxy Gear and Apple (NASDAQ:AAPL) is rumored to be working--Chou said HTC is taking more of a wait-and-see approach for now, but said the market is important.
Wearable technology is "a critical segment for us," Chou said. "It matches what we do today as a mobile experience overall. That is one area we are excited about."
As for the market's potential, Chou said: "It's still too early," with many "version one," "gimmick" watches lacking in style. "It has to meet a need, otherwise if it's just a gimmick or concept, it's not for people's day-to-day lives. That is an opportunity for us," he said. "People laughed at us when we came out with the first smartphone…Now everyone has a smartphone. I'm pretty sure wearables will be the same, but don't judge from what is in the market [now]."
For more:
- see this FT article (sub. req.)
- see this second FT article (sub. req.)
- see this third FT article (sub. req.)
- see this WSJ article (sub. req.)
- see this Reuters article
- see this The Verge article
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