Market Overview

Is Apple About to Kill Off Another iPhone Competitor?


The Mac maker is locked and loaded. But which tech giant will be the next to fall?

It won't be Hewlett-Packard (NYSE: HPQ), which thought about abandoning the PC manufacturing business before coming to its senses. HP did admit that Apple will lead in 2012, but eventually realized that the market is big enough for more than one company to survive and decided to keep making PCs. Shocking, eh?

In the smartphone business, however, Apple (NASDAQ: AAPL) has just one formidable competitor: Samsung. This leaves the other guys – from Sony (NYSE: SNE) and Nokia (NYSE: NOK) to Motorola (NYSE: MMI) and Research in Motion (NASDAQ: RIMM) – in a bit of a pickle.

But at this very moment, only one company is facing certain doom: HTC. According to TechCrunch, HTC is forecasting a “huge” drop in revenue in the first quarter, with revenue dropping as much as 36%. The company blames the decline on a product transition, short-term difficulties, and other excuses that can be translated into the following (though completely unofficial) message:

“Apple is kicking our butt.”

True story. Painful story. Never mind the reports of the iPhone 4S trailing Samsung in Europe – worldwide, the new phone still managed to sell more than 30 million units! Samsung may be able to sell more units across its massive lineup of smartphones, but on the basis of individual models, the iPhone is still king.

The irony here is that HTC has been Apple's chief copycat from the day the first iPhone clone arrived. Unlike Samsung, which has continually strived to develop competitive products, HTC built phones with only two advantages: (1) they were bigger than the iPhone, and (2) they were available on Sprint (NYSE: S) and Verizon (NYSE: VZ). Up until last year, that latter point was a big deal for iPhone-craving users who could not or did not want to switch to AT&T (NYSE: T). But that's no longer an issue, which leaves the larger screen as HTC's one advantage, something that other iPhone competitors also offer.

For some, bigger screens are actually detrimental to the user experience. While the larger screen is great for those who text, surf, and play with two hands, users who prefer to perform those same tasks with one hand are left in the cold. (Unless they have really big hands; most people don't.)

In terms of features, functionality, and overall quality, most users are willing to sacrifice a larger screen – even if it's something they really want – for the benefits that Apple and Samsung phones offer.

This is definitely not the outcome HTC was hoping for when it set out to create the world's leading iClone.

But on the bright side, it's safe to assume that if HTC goes out of business, the company won't have to battle Apple in court over patent infringement. That's got to count for something, right?

Follow me @LouisBedigian

Posted-In: Apple HTC iPhone 4SNews Tech Best of Benzinga


Related Articles (AAPL + HPQ)

View Comments and Join the Discussion!

Partner Center