Taiwanese smartphone manufacturer HTC Corp (TPE:2498) is developing its own mobile operating system designed for Chinese consumers in order to revitalize its declining sales performance, according to a report from The Wall Street Journal.

HTC

Cher Wang is supervising the development of its mobile operating system

Sources said that Cher Wang, chairperson of HTC Corp (TPE:2498), is supervising the development of its mobile operating system, which is expected to roll out by the end of the year. Wang is in talks with government officials in China regarding the company’s project—an effort to compete with Google Inc (NASDAQ:GOOG) and Apple Inc. (NASDAQ:AAPL), the leading technology companies in the United States.

Last March, the Ministry of Technology in China said that the country’s mobile industry is highly dependent on the Android operating system of Google Inc (NASDAQ:GOOG). The agency applauded Chinese internet companies such as Alibaba Group Holding Ltd and Baidu Inc (NASDAQ:BIDU) for developing their own operating systems.

The Taiwanese smartphone manufacturer’s initiative in creating its own mobile OS will be received positively by China’s Ministry of Technology given its previous statement. Two years ago, HTC Corp (TPE:2498) revealed its plan to develop its own mobile operating system. The company will integrate Chinese apps to its mobile OS with Chinese apps such as Weibo, a micro blog similar to Twitter, according to the report.

HTC smartphone prototypes in test phase

According to sources, HTC Corp (TPE:2498) sent prototypes of smartphones powered by its own operating system to Chinese officials, which are currently being tested. HTC insiders believe that the company aims to strengthen business and political ties in China through mobile OS especially designed for consumers in the country.

Last month, Peter Chou, CEO of HTC Corp (TPE:2498) expressed that China is a growth area for the company. According to Chou, “We are very excited about the China market, because not many brands can play in that high-end segment.”

Technology observers note that new operating systems failed to compete against Google Inc (NASDAQ:GOOG)’s Android OS and Apple Inc. (NASDAQ:AAPL)’s iOS. Data from market research firm Gartner showed that the market shares for Android OS and iOS in the global smartphone market were 79% and 14.2%, respectively. Operating systems from other companies have 4% or lower market shares.

Last month, analysts at Bank of America Merrill Lynch (BAML) projected that HTC Corp (TPE:2498) will experience difficulty in generating sales growth in the second half of this year despite the success of HTC One.