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June 6, 2007 12:38 am

HTC launches its first mass-market phone

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HTC, the global market leader for Windows-based mobile devices, has launched its first mass-market phone in an attempt to create new growth after losing contract manufacturing orders and witnessing a rise in competition in its traditional niche of high-end smart phones.

The HTC Touch, a small, stylish smartphone that can be navigated with one hand through touch-screen technology, marks “the first time we move beyond our niche of business devices”, Peter Chou, HTC president, told the Financial Times.

Analysts think it has the potential to help turn round a prolonged drop in HTC’s share price.

After peaking at T$1,220 in March 2006, the company’s shares started to slide, triggered by its announcements that it would acquire Dopod, a handset vendor controlled by family members of HTC’s chairwoman, and that it would start selling its phones under its own brand.

In March, the share price had melted to T$425, driven by the loss of contract manufacturing orders and investor fears that margins would suffer from the lack of new growth drivers.

Investors have also expressed doubt whether the Windows niche will be big enough in the long term and whether HTC can keep ahead within this market given that Microsoft has also licensed many other handset companies.

These concerns are being addressed with the new model, Mr Chou says. “From the HTC Touch, you can clearly see our capability to differentiate ourselves.”

Apart from the touch-screen technology, the new device also has an easier user interface to make it more suitable for consumers, who have struggled with the complicated Windows interface.

The new phone would be sold under the HTC brand as well as a customised model for telecommunications operators.

T-Mobile will take it on board as part of its MDA series while Orange will sell it under the HTC Touch name.

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