Panasonic is going to get out of the smartphone business, after realizing they are nowhere close to being competitive in this market, nor do they have the expertise to do this anymore, and they are offering the smartphone business up for sale. Apparently, two of the candidates for buying their business would be HTC and TSMC, the world’s largest 3rd party foundry company.
TSMC entering the smartphone business would be quite strange, as besides being able to make chips (not even designing them themselves), they know nothing at all about smartphones. While using a good chip is very important for smartphones today, that’s still a pretty small part of what makes a great smartphone that people want to buy.
So unless TSMC is extremely serious about this, and want to hire the best people in the world to build them a successful smartphone business, and are willing to pour billions into developing and promoting that smartphone business over the next couple of years, I’m not seeing them going too far with this, especially with a smartphone division from Panasonic, of all companies.
And then there’s HTC, which although knows quite a lot about the smartphone market, and makes some of the very best smartphones, that doesn’t seem to be quite enough these days, and their lack of big revenues and profits is becoming more painful by the day. So why would HTC want to merge with a dying and obsolete smartphone division?
It doesn’t make much sense, and this sounds like some of the bad investment decisions HTC made last year, that turned out to be a huge waste of money. So if they are doing this, they better know something we don’t – something they are sure would catapult them at the top of the smartphone market again. What that could be remains anyone’s guess. Does HTC really need more employees right now? Seeing how their revenues are declining, I would’ve thought they’ll want to lay off a bunch of people soon, not hire more.
If this is just another bad investment from HTC, then I hope Peter Chou steps down sooner, rather than later. I don’t want HTC to be one of those companies that take their CEO’s to the “grave”, and the board refuses to let him go until it’s too late for the company to recover. I’d rather see HTC get new leadership with fresh perspective, that is a lot more savvy about where to put the little money they have left, to turn the company around.