HTC’s Sales Drop, Company Now Hoping to Bank on Virtual Reality
The smartphone maker based in Taiwan hopes its sales could be revived by its Virtual Reality headset.
It’s not very difficult to see why HTC is placing all its hope on virtual reality. In a statement by smartphone maker based in Taiwan, its sales in the first quarter declined by 64% which amounts to about $455 million- its fourth straight quarterly decline. Hardware makers like Huawei are giving the company a run for its money.
According to technology research firm, Catalyst, based on shipments, HTC was the biggest name amongst smartphone vendors in the year 2011 in the United States beating Apple APPLE 0.08% and Samsung. However, things have taken a new turn as Samsung and Apple now dominate smartphone sales in the U.S. and the rest of the world.
It is, therefore, no surprise that HTC has been working extra hard at something else which is Virtual Reality in this case. HTC’s top executive told The Telegraph in January that HTC has been hurt by other smartphone makers and Chinese competitors but they are working hard to make sure virtual reality becomes an integral part of the company’s future. HTC introduced its Virtual Reality headset, the HTC Vive last month and so far there have only been positive reviews. The device allows users walk around and interact in immersive, simulated environments and can only be powered by very powerful computers. Its retail price is $800. It cannot be concluded yet if the device will have any effect on the HTC’s sales as HTC’s latest earnings is not inclusive of the VR headset.
The main challenge HTC faces is that their foray into the VR market is still very early although optimistic analysts nonetheless have predicted the sales of 200 million different VR headsets by 2020. Reality media is not readily available which is why HTC created a $100 million fund recently to invest in virtual reality-centric startups. HTC stands to benefit a lot if more companies helped to popularize the technology as the Virtual Reality space is still small. The competitors of HTC in the Virtual Reality market are Facebook’s Oculus Rift which costs $600 with a lot of positive feedback as well and Sony’s virtual reality headset which will be released in fall. Also Samsung might possible be developing a higher-end VR headset than the current Samsung Gear headset it sells. HTC has been hurt by competition in the smartphone market in the past and the company is yet to recover. With HTC going into the VR business, the competition doesn’t seem to be slowing down anytime soon.