HTC Launching New Flagship Phone in Bid to Thwart Samsung

The launch may be problematic. HTC has been struggling for some time against the superior marketing muscle of Samsung, which is expected to introduce its Galaxy S5 device on Feb. 24 at the Mobile World Congress in Barcelona, Spain.

HTC’s new phone is coming at a make-or-break moment for the company. Once the darling of smartphone enthusiasts, HTC has seen sales and profits tumble in the last two years. HTC’s stock price has fallen some 80% to around $150 (Taiwan) from a 2012 peak of $651.

Samsung’s offerings have come to dominate the world of Google Inc.’s (NASDAQ: GOOG) Android OS, and Apple Inc.’s (NASDAQ: AAPL) iPhone commands a premium position in the U.S. market.

Samsung has been winning not just because of size and its ability to pour considerable resources into marketing. A larger problem is that consumers see Samsung offering better software with more features for its devices.

And in the smartphone world, software is king.

HTC also has suffered by a strategy of charging a premium for its phones, which are known for excellent design and reliability. That means $500 or more. The problem is that the sweet spot in the mobile phone market is around $150 and falling.

So, this year, the company plans to expand its range of cheaper products as it fixes off-target marketing for its premium smartphones. “The problem with us last year was we only concentrated on our flagship. We missed a huge chunk of the mid-tier market,” co-founder and Chairwoman Cher Wang told Reuters recently.

Chang said HTC will sell products in the $150 to $300 price range for both emerging and developed markets, along with high-end phones which can sell for over $600. HTC won’t get into the “very, very low-end market,” she added.

She also hinted about the new flagship phone, presumably the device coming on March 25.

The question is whether HTC is too late.