Not the best way to sell a smartphone David Segal, The New York Times | Updated: March 23, 2014 12:50 IST (Handout via The New York Times) Screengrab of a video comparing HTC phones, posted to YouTube. As HTC readied a new version of its flagship smartphone, it planned for many challenges. It didnt know that one of them would be Roshan Jamkatel, a teenager from Schaumburg, Ill. On March 2, Roshan - a self-described prankster - turned up on YouTube offering a hands-on, guided tour of the sequel to HTCs highest-profile product, the One. The worlds first glimpse of the device was scheduled for this Tuesday, at the sort of orchestrated reveal that has become the industry standard, with product demonstrations, plenty of video-screen close-ups and a crowd to give the proceedings a sense of moment. Locations in New York City and London were booked for the occasion. But Roshan upstaged this show with a rambling, mumbly critique that was posted for all the world to see. (The video was up, then taken down, then resurrected on a batch of Android fan sites and now is much harder to find.) Forget stagecraft. The phone was placed on what appears to be Roshans outer-space-themed bedspread, and his monologue was sprinkled with bland endorsements like, The build design of this phone is really nice, and This camera, I give it a 9 - no, an 8.7. You imagine that after watching this sneak peek, HTC emitted a sound similar to the whup-whup-whup that Curly of the Three Stooges made whenever Moe poked him in the eyes. But publicly, the only sign of outrage was a message from HTCs senior global online communications manager, Jeff Gordon, to Roshans Twitter account. Its not going to be a good week for you, my friend, Gordon wrote. Its a fake phone, Roshan tweeted back. We have the IMEI and all the other info, replied Gordon, referring to the unique identifiers given to each device. Well be in touch. Gordon would not comment about this exchange, and Roshan did not respond to a message left on his cellphone. But it was only the most notable leak of many that have bedeviled the run-up to the official introduction of the phone, which might be called the All New One. The leaks have included photographs, performance specs, downloadable versions of wallpapers and ringtones, a look at a new smart cover, an ad explaining the new dual-lens camera and what is apparently a sales guide for retailers. (Load up the camera and show the customer how they can take a selfie in the new Selfie mode.) As a final indignity, one of the phones was sold on eBay for about $500. So much for the element of surprise. These are just the latest setbacks for HTC, a company based in Taiwan that as recently as 2011 sold more smartphones in the United States than any other maker, according to the research firm Canalys. Since then, shares of HTC have plunged almost 90 percent, shrinking its market capitalization to $4 billion from $33 billion. HTCs biggest problem is its mightiest foe, Samsung, which last year spent $14 billion on advertising - about the same as the GDP of Iceland. HTC posted its first-ever operating loss in the third quarter of 2013, after which ABI Research, a consulting firm, said that once such handset companies become unprofitable, only 10 percent can be expected to survive the next two years. The prognosis underscores how perilous the smartphone business has become. In just five years, companies like BlackBerry, Nokia and Motorola have gone from leaders to takeover bait or balance-sheet basket cases. Startups in China, India and Brazil are grabbing mid- and low-end sales, and the high-end market is increasingly dominated by Samsung and Apple. If youre not a Tier 1 smartphone maker, its difficult to be heard, said Ken Hyers, a senior analyst at Strategy Analytics. You dont have the megaphone, which is the marketing spend. Typically, manufacturers like HTC crater because their products stink. But HTCs downward spiral has distressed plenty of phone geeks who think it makes the best devices on the market. The One, released in 2013, earned the Smartphone of the Year title at the Mobile World Congress, held in Barcelona in February, and was only the third phone to win a five-star review from TechRadar. A critic at the site said the phone is closing in on flawless. A reviewer at AnandTech said, The One is without a doubt the best Android smartphone Ive ever used. And David Pogue, the former tech critic at The New York Times, wrote, You could quibble with the software overlays, but it would be hard to imagine a more impressive piece of phone hardware. It isnt enough, though, to design a great smartphone. You also need to sell it, and when your main rival is blanketing the planet with ads, your marketing strategy had better delight and astound. HTCs did neither. The most important thing is communication, and we didnt communicate with our end users well last year, said Cher Wang, HTCs co-founder and chairwoman, in a telephone interview Wednesday. Were going to do it better this year. Among the companys 2013 misfires was an extravagant and daring two-minute ad starring Robert Downey Jr., which was first shown in August. Downey plays a swaggering marketing genius who emerges from a helicopter, a briefcase chained to one hand, and is ushered into a room full of executives to explain how HTC should position itself.
Posted on: Mon, 24 Mar 2014 19:34:12 +0000
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