Foreign investors cast gloom over HTC's first phablet
By Ted Chen,The China PostTAIPEI, Taiwan -- Following the launch of the 5.9-inch One max phablet in Kaohsiung last Friday, a foreign institutional investor yesterday expressed pessimism over the prospects of HTC's first phablet.
October 22, 2013, 12:06 am TWN
Phablet, which has seen a rapid rise in popularity recently, is a smartphone form factor denoting devices with a larger screen, typically ranging from 5 to 6.9 inches, designed to eliminate the need for users to carry both a tablet and a smartphone.
Goldman Sachs (高盛證券) yesterday announced that it will maintain its downgraded rating for HTC, setting the company's target share price at NT$80, while advising investors to sell holdings.
In addition to being the only Android-platform handset equipped with a finger print unlocking mechanism, the One max boasts a number of features, including dual onboard speakers and the latest Sense 5.5 user interface. According to reports, the handset model has been included in the contract subsidy program of numerous telecoms carriers in China, with the company poised to benefit from the expected rise in sales across the strait.
However, the foreign institutional investor stated in its recently published report that despite the aforementioned advantages, the company's venture into the phablet market lags behind other competitors in the niche, particularly Samsung, which pioneered the demand in larger formatted handsets with its Galaxy Note line.
Citing reports by market research institutes, Goldman Sachs stated that HTC needs step up its efforts, as the global phablet market has seen saturation by well-entrenched competitors. According to surveys by research institutes Flurry and IDC, over 41 percent and 30 percent of smartphones used in South Korea and India are larger than 5 inches.
Meanwhile, the market is rife with rumors that HTC is poised to collaborate with Lenovo's (聯想) retail arm and Amazon.com, Inc. in releasing new devices; however, these reports have yet to be confirmed by the company.
Based on the firm's history of initiating partnerships, it is unlikely that HTC will be able to yield beneficial results from such collaborations, said Goldman Sachs.
Shares of HTC yesterday lost NT$2.5, or 1.88 percent, and closed at NT$134.