Can HTC mobile phone business rise in the VR industry after selling it?

In September, after HTC transferred some of its mobile phone business to Gree for $1.1 billion, HTC focused on the production and development of its own brand of HTC Vive (virtual reality device). Netizens have speculated that HTC will rise in the VR industry. If this is the case, then HTC is not a big loss in the previous period.

The VR/AR circle is not calm at all. Just recently, in order to focus more on VR business, HTC will "sell" some mobile phone business. Google won $1.1 billion and directly slaughtered the tech news headlines for several days... All this is explained, after the first half of this year, With the momentum, the VR industry will be blasting in the second half of the year.

Can HTC mobile phone business rise in the VR industry after selling it?

HTC is in a difficult situation in the near future. According to its latest announcement, its revenue in August this year was NT$3 billion (US$99.69 million), down 54.4% year-on-year, the lowest monthly revenue since 2013. Sales in the first eight months fell 14% to NT$39.8 billion. It is reported that HTC has experienced losses for nine consecutive quarters. IDC's ranking of the world's smartphone market released on September 20th shows that HTC's market share is only 0.68%.

In the past five years, HTC's market value has evaporated by nearly 75%. Today's market capitalization is only $1.9 billion. The mobile phone business has lost less than 2% of the global smartphone market and has already fallen out of the top ten in the market.

On September 21, HTC and Google jointly announced the signing of the agreement. Under the agreement, Google has joined HTC members who originally participated in the creation of Google Pixel phones to join Google, while HTC will receive a transaction price of $1.1 billion.

But this does not mean that HTC will give up its mobile phone business. HTC Chairman Wang Xuehong made it clear after the transaction announcement that HTC will continue the business of smart phones and VIVE.

In terms of short-term impact, HTC's cooperation with Google, which is known for its R&D capabilities, can solve Google's desire for R&D talents, further obtain patent licenses and related equipment, and also enable HTC to inject funds to solve the nine consecutive quarters of losses. Can be described as a win-win situation. However, in the long run, the transaction released about 70% of its R&D resources for smart phones, which undoubtedly slammed HTC's R&D capabilities and worsened the situation of deteriorating sales.

After a certain degree of "cutting off" the mobile phone business, HTC will focus on the production and development of its own brand of smart phones and HTC Vive (virtual reality devices).

HTC continues to invest in VRChat, which also indicates that it is vigorously developing software and content. In VR content, social is also a part of what giant Facebook is betting on. At the developer conference in April this year, Facebook's VR social platform Spaces officially launched on the Oculus Rift (a head-mounted display). On the Spaces you can generate vivid virtual characters, anything in VR will become a reality, you can video chat with friends in the real world, you can also take a selfie together.

It is understood that in response to the decline in the mobile phone business, as early as March 2015, HTC has been eyeing the new business growth point of VR, and announced that it has cooperated with Valve to develop HTC Vive, and it is currently on sale, according to the survey company SuperData. According to the data, as of June 2017, in the three major heads, the sales of htc vive (420,000 units) is less than the 1 million units of PS VR, but it is higher than the leader of VR helmets (243,000 units). Htc vive is still in the forefront of the industry.

As one of HTC's most popular businesses in the past two years, HTC Vive has achieved dazzling results, but since the VR industry is still not mature enough, HTC will need to come out in the future.

However, although VR has a promising future, it has already passed the early adopter period of people's pursuit of chasing. At the same time, VR is also experiencing many immature factors due to resolution, delay, field of view and interaction. A cliff-like decline. In order to change the market downturn, the three major VR vendors - Sony, HTC and Oculus - have all made some price cuts.

However, despite the large price cuts, there are no signs of any breakthrough in these bottlenecks. For HTC in the case of such a downturn in the market, still choose to retain VR, Ren Fuxin believes that HTC made such a choice is definitely well thought out. Wang Congqing, president of htc vive China, said that after this round of trading, HTC will focus more on VR/AR/AI.

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