We’ve heard analysts come out with some pretty amazing things recently, but this one might be one of the craziest we’ve heard in a while. Of course, none of us here are sat in the offices of HTC and Huawei so we have no idea what any of them are thinking but, I hardly think that HTC is considering a merger with Huawei, no matter how industrious they might be. The Taipei Times is reporting that JP Morgan Analyst, Alvin Kwoch, thinks that HTC and Huawei could well join forces. Let’s take a look at why he thinks as much, shall we?
“Combining Huawei’s China expertise with a brand that has a superior product and consumer experience could boost future growth for the company by bringing complementary expertise in-house,”
Kwoch has a point here, HTC’s branding does carry a certain level of respect and adoration but, not so much in China. In fact, HTC hasn’t been trading as HTC there for as long as Huawei have. Huawei’s products in China are extremely popular and they command the same sort of brand presence as Samsung does elsewhere around the world. Kwoch does go on to say that while Huawei has a strong home brand, it lacks the same sort of International Exposure as HTC, which is certainly true. However, when we hear Huawei talk of the competition, it’s more that they want to surpass them, and that they have something far better to offer. I somehow can’t see Huawei bringing HTC under their wing, expect to phase out the HTC brand and charge forward under the Huawei banner.
Mr Kwoch goes on to cite poor performance on HTC’s part as another reason that they would consider a merger but, the Taiwanese based company doesn’t appear to be losing money just yet, so why would they be in any desperate move to find a richer partner? Add together Huawei’s issues with the US government and HTC would be wise to avoid merging with Huawei. Whether or not Huawei does have something to hide is irrevelant, they’re not spectacularly welcome in the US and if HTC merged with them, we’re sure that the HTC brand would come under the same scrutiny.
What do you think? Could HTC merge with Huawei, or is this Analyst dreaming a little too much on this one?