Taiwanese smartphone manufacturers HTC, which has close to 5% market share in India, aims to reach 10% share by 2015. The company, known for its high-end phones, especially in developed countries, will, however, focus on the mid-range smartphone segment, the price of which falls in the R10,000-30,000 range. HTC’s chief financial officer and president of global sales Chia-Lin Chang shares the company’s plans and strategies in an interview with FE’s Rhik Kundu. Excerpts:
What is HTC’s strategy for India?
India is a critical market for HTC. Our share here has increased quite dramatically in the last nine months or so. At present, we have 4.5% share and our plan is to reach the 10% figure or higher by the end of calendar year 2015. Hopefully, this will lead to a higher value market share. We have taken initiatives to achieve this growth. For instance, we are expanding a part of our portfolio to suit the Indian market, which is growing fast. Indians, as smartphone consumers, can be divided into three segments — high-end users who use phones worth R50,000 and above, mid to high-end users who use phones worth R30,000-50,000 and affordable users who use handsets in the R10,000-30,000 bracket. We want to address this last segment and occupy this space strongly. We believe that with our product, and an attractive price, we can expand our market share to over 10% by 2015-end.
Can we expect more launches in the R10,000 to R30,000 segment in the coming quarters? How many handsets does HTC plan to release?
I can’t give you the figures but we will release many phones in this segment in the coming quarters. What we want to do here is to introduce a product portfolio, which would occupy major price segments – high-end, high to mid-end and mid-end – and introduce attractive pricing for our handsets in all of these segments. We will also concentrate on maintaining stable prices.
Reliance Jio has announced it will roll out 4G technology in India, across data and voice platforms, in a phased manner from 2015. Do you look at this as an opportunity?
HTC was the first handset manufacturer that introduced 3G technology-enabled smartphones. We were also the first phone maker to introduce 4G enabled smartphones about 4-5 years ago. We always want to be the frontier and leader and roll out the best designs, best brand and experience based on the latest technology. HTC Desire A20 is a good example, as it is not only a 4G-enabled phone but also a great processor. We have a significant customer base that buys 4G-enabled phones, but then we also have a huge customer base in different price tiers – who like 3G-enabled phones at affordable price points. So our product release will be driven by consumer choice. In the next two quarters, one can expect a lot of new releases by HTC in India. These handsets will be a combination of 3G and 4G enabled phones.
There is a price war going on between retailers and e-tailers, with the latter giving heavy discounts on handsets. Several brick and mortar stores have threatened original equipment manufacturers that they wouldn’t stock their products if e-tailers were given a further free hand to roll out discounts. How are you tackling this issue?
I wouldn’t say we are not facing this problem at all. Overall, the response from e-tailers and brick and mortar stores have been positive. They are a key part of our strategy and growth in India. We want to make sure that there is a price parity between retailers and e-tailers who sell our phones.
Would you consider asking the e-tailers to cut down on the discounts offered on HTC phones to please your retail partners?
No, we will not do this.
How much does HTC India contribute to global revenues of the company?
We can’t give out the data. However, India has risen from strategically important to financially meaningful geography for us, which will contribute significantly to global finances of the company by 2015.
Considering you have a close partnership with Google, why was HTC not considered a handset partner when Google launched its Android One phones?
HTC is one of the brands which supports several of Google’s initiatives. Android One has been priced at a certain segment. We want to showcase HTC as a brand of choice in the Indian market and at a particular price segment (R10,000-30,000 bracket).