Why HTC Scrapped A Device That Would Compete With Apple
Why HTC Scrapped A Device That Would Compete With Apple:- It’s not official, but tech media and analysts say Taiwanese smart device developer HTC has given up the idea of coming out with a smartwatch for now. Two years ago the company better known for phones announced a partnership with sports clothing firm Under Armour to develop smart devices for athletes. The two have come out with a band, a grip and more. Everyone sort of thought a smartwatch would eventually emerge. Apparent plans for an HTC Android watch are dead, according to this report from Wearable.com. The company neither confirms nor rejects that report.
A dead watch wouldn’t reflect on HTC per se and might even save it some hard-to-get money.
Watches don't quite work out for a lot of vendors because world demand for wearable devices fell short of the widespread marketing-driven hype in 2014 and 2015, tech analysts say.
“The value proposition and user experience haven’t been very attractive to the mass market yet, thus limiting it largely to a toy for technophiles,” says Bryan Ma, client devices vice president with market research firm IDC Asia-Pacific and Worldwide. “The issue is that the market isn’t ripe enough for them to pull the trigger yet.”
IDC expects that global smartwatch shipments fell 18% in 2016 across brands to a combined 16 million units. In last year’s final quarter, including the Christmas shopping season, shipments grew just 1% over the same quarter of 2015, Strategy Analytics says.
And HTC is hardly Apple, which according to Taipei-based market research firm TrendForce is the only company making money on a watch. Apple produced two in every three of the roughly 9 million smartwatches shipped worldwide in the fourth quarter of 2016, giving itself a 12% gain over the same period a year earlier, according to market research firm Canalys.
“The current outlook for the smartwatch market is not particularly bright,” says TrendForce wearable device analyst Jason Tsai. “Though Apple Watch Series 2 had an impressive shipment result in the fourth quarter of 2016, Apple’s success on this front is mainly based on its powerful brand name. If HTC were to release new smartwatches, the company would not expect these products to help make a turnaround in its overall financial performance.”
The Taiwanese company reported a loss last quarter of NT$3.1 billion (US$100 million).
For now HTC is working more ostensibly on virtual reality gear and high-end handsets as well as Under Armour-branded smart wristbands. But it's keen to study other kinds of gear as virtual reality competition grows and HTC's smartphone market share has fallen from a 10.7% peak in 2011 to something you can count on one hand.
So it may still pursue a smartwatch. An HTC supplier is shipping watch components to the company this quarter, says Ian Wang, industry analyst with the Marketing Intelligence & Consulting Institute in Taipei.
"HTC seems to temporarily halt the smartwatch launch as the company (finds) it is hard to compete with brands like Apple Watch and Xiaomi Watch in terms of profitability and competitiveness," Wang said. But, he says, "the company may not give up on it completely yet."
Source:- http://www.forbes.com/sites/ralphjennings/2017/02/22/htc-drops-smartwatch-plans-in-sign-of-a-worn-out-technology/#5a1fc1584e25
