HTC Corp (TPE:2498) took the center stage yesterday, and revealed its two flagship smartphones powered by Microsoft’s Windows Phone 8 operating system. HTC’s Windows Phone 8X and 8S sport a stylish industrial design in vibrant colors, and are equipped with the most sophisticated front camera and key hardware features.
Despite its attractiveness and hardware improvements, Pauline Chen and Josette Chang, analysts at Credit Suisse said the specifications of the 8X and 8S Windows Phones “looks worse” than Apple Inc. (NASDAQ:AAPL)’s iPhone 5 and Samsung’s Galaxy S3.
The analysts believe that HTC Corp (TPE:2498)’s flagship smartphones will gain market share at the expense of the products of Research In Motion Limited (NYSE:RIMM), or second-tier Android smartphones. According to them, the mobile devices have “little software differentiation (no HTC sense) with higher royalty payments.”
On a positive note, Chen and Chang think the HTC Windows Phone 8X and 8S beat Nokia Corporation’s (NYSE:NOK) Lumia 920 and the Samsung Windows Phone 8 in terms of LTE support. It has a better hardware design than Lumia 920 in terms of camera resolution, thickness, and weight. The analysts expect strong orders for the HTC smartphones in the near term, particularly next month.
Chen and Chang noted that strong competition and platform difference remain the biggest challenge for the company. Both analysts recognized HTC’s design, but the company still needs to prove capability in execution. They maintain their “underperform” rating for HTC shares, with an NT$ 306 target price per share.
On the other hand, Nokia’s head of marketing, Chris Weber, also expressed his criticism of the HTC Windows Phones. According to him, Nokia Corporation (NYSE:NOK)’s Windows Phones are better than the HTC products.
HTC Corp (TPE:2498) is expected to release its Windows Phone 8X and 8S in the market by November. Prices for the products were not yet disclosed, but many technology bloggers believed they will be competitive. According to HTC, the carriers of the HTC Windows Phones are AT&T Inc. (NYSE:T), Verizon Communications, Inc. (NYSE:VZ), and T-Mobile.
In August, NBF Daily Bulletin’s quarterly smartphone report revealed that HTC is one of the top 5 smartphone manufacturers, while RIMM lost its position. Last month, Oppenheimer suggested that HTC would ship as many as 9 million smartphones during the third quarter of 2012. Its sales growth next year will be driven by its new marketing initiatives.
