HTC to reduce product range in 2012

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After a 25% drop in profits, HTC acknowledges that its product range - of dozens of smartphones and tablets - is simply "too much". A leaner, more focused product portfolio is promised for 2012.

Spend a few minutes trying to understand HTC’s product range, and the chances are you’ll eventually give up, or slowly descend into madness. It may be argued that a diversified product portfolio can be a good thing, but when it comes to HTC's line-up, the market evidently disagrees – HTC reported a 25% drop in its quarterly profits just three weeks ago, its first such decline in two years.

Take a look at HTC’s smartphone range for the US and UK markets:

The company actually itemises even more devices than these; there are, for example, four variants of the Wildfire S listed (for T-Mobile, US Cellular, Virgin Mobile and metroPCS) on the US website. Visitors browsing HTC’s current phone offering on its US site are greeted with a list of 51 phones in total (including a bunch of Windows Mobile 6.5 devices). Impressive, perhaps - but also bewildering to buyers who aren’t intimately familiar with the company’s range.

So it’s encouraging – and something of a relief – to learn via The Next Web that HTC is planning to consolidate its range of devices in 2012, with products that are fewer in quantity, but better in quality. HTC’s UK supremo Phil Roberson conceded that the company didn’t get things quite right in 2011, including a tacit acknowledgement that the company needs to move away from offering multiple versions of essentially the same product, but promised that these failings will be addressed this year:

We have to get back to focusing on what made us great… We ended 2011 with far more products than we started out with. We tried to do too much. So 2012 is about giving our customers something special. We need to make sure we do not go so far down the line that we segment our products by launching lots of different SKUs.”

Earlier this month, HTC’s chief executive, Peter Chou, stated that the company has been working for several months to place a greater emphasis on product innovation, underlining this point by stating that HTC wants “to make our innovation a big idea, even bigger”. He also welcomed increasingly strong competition from rivals such as Samsung, Motorola and LG: “Competition is good. Competition pushes us, helps us to change better and quicker. And we will be stronger.”

Establishing a leaner and more defined product range will be an essential step towards strengthening HTC against what Chou called the “nuclear weapons” of its smartphone rivals. He remains convinced that the company can win the war: “HTC is an excellent team and a strong army. A good soldier will not fear battles.”

Despite suffering a bloody nose last quarter, HTC clearly isn’t ready to surrender the fight – but we’ll have to wait and see if it brings the right weapons to the battlefield this year.

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