Clad in an all-black outfit and projecting his usual air of cool confidence, HTC CEO Peter Chou today introduced his company's big new hope for 2013, the HTC One. Amid the hubbub surrounding the London launch of his company's new Android flagship, Peter was kind enough to sit down with us for a fireside chat about HTC's struggles of the past year and how it hopes to correct them going forward.
Vlad Savov: What are the big lessons that you learned over the last year with the One X and the One S? Those represented a big change in design for HTC, as does the new One, what will be different about your approach this year?
Peter Chou: Well, we had to create a great product with a lot of innovation in it, and the reviews of those devices were very positive, but we failed to communicate with the people that really know and appreciate those products. I think marketing execution is one of the things we learned from that and that's why we have a new approach to our marketing. We want to drive change and we're pushing innovation even more strongly than before and also drive change in marketing execution.
"We want to drive change and we're pushing innovation even more strongly than before."
You've always pushed innovation, so that hasn't actually been a change for you, but what has changed about the message you're sending out to the consumer?
There's a lot of things, number one is to make sure that the execution is solid so people really get the message, and number two is to properly align our marketing with the local regions, markets, and our partners, so that it stays out there for longer. We don't want to be very broad, we're trying to be very smart and nimble and engage primarily with those who we believe are our core customer.
And who do you think they are?
We think that they are those people who are driven and are passionate about their beliefs and are looking for differentiation. They want something different from the mainstream, they appreciate innovation, they appreciate cutting edge design, and they appreciate inspiring experiences. So we will be targeting those people.
On that topic, who is the person who buys HTC over Apple or Samsung? Why would they opt for HTC over the others?
The people who buy HTC appreciate innovation, love the design, they love the user experience, and have an emotional preference for innovative experiences. The user experience is actually very bold — bold is in fact of the main characteristics of HTC. So we are offering this bold experience and we strongly believe consumers will engage with things like HTC BlinkFeed, our unprecedented music experience, and Zoe photos.
You've had your fair share of financial difficulties recently, so the question arises, why aren't there enough of these people around for you to make money?
When people really love the device, the profit or the financial side of it will be a simple byproduct. The first thing you have to do — we have to do — is focus in on the innovation and the execution.
Would you say the past year's struggles have been down to a failure to engage with the HTC consumer?
There are several reasons. Firstly, the competitive market has changed and we've also had some marketing execution issues, so it's a combination.
What about Sense — have you considered doing Nexus-class devices, handsets that either run stock Android or offer it as an option?
As a company, we really want to offer something unique and differentiated and HTC Sense helps us to do that. If you don't have the kind of deep capability it provides, you won't be able to do things like BlinkFeed and our custom camera experience, you won't be able to differentiate, you won't be able to really drive the innovation.
So you need Sense in order to drive software innovation?
What is the return on investing so heavily in custom software like Sense?
You have to commit to what you really believe, and then you drive it, and over time, people will embrace it, and that's the way to do it. You know, not purely from a return of investment perspective, not purely from a numbers perspective. The only value will be coming from innovation, the only value will be coming when you really commit to what you believe.
"You have to commit to what you really believe, and then you drive it, and over time, people will embrace it."
With the HTC One, are we talking about a Sense 5 device underpinned by Android or an Android device with Sense 5? What comes first?
Oh no, no, no. They all blend together, we don't specify what is first. All the Android experiences are here. There's no fragmentation, people like to keep saying that, but actually this is wrong. There's no such thing. This is an HTC Android device.
Sticking with the software question, which do you prefer as a smartphone OS, Windows Phone or Android? Which are you happier with?
People like differentiation and there's no one thing that everybody likes. We have a great partnership with Google, we also have a great partnership with Microsoft. We, as a company, would like to remain open-minded and offer people the choice to decide what they want.
But what do you want?
I like both.
Which are you using at present?
I like both.
Are you looking at any other smartphone operating systems, such as Ubuntu, Firefox OS, or Tizen?
We are not. We're only focusing on Android and Windows. Otherwise, you'll keep asking me the question, which one do you like best?
What is the reason for that, do you see Android and Windows Phone as the two most viable platforms?
Well, this is about partnership, and of course, they have a lot of value, and we think we can mutually add value.
Are Android tablets just not worth it, will you not be doing any more?
No, we have a definite interest in tablets, we just need to figure out how we can differentiate a tablet product.
And which operating system would it run, Windows RT maybe?
"We have a definite interest in tablets, we just need to figure out how we can differentiate."
Hmm, I'd say whatever makes sense. At HTC, we have this innovation nature, this innovation DNA, so we're looking at many things, looking at which one would make the most sense.
There have been rumors about an HTC-built Facebook phone, is there any truth to them?
I don't comment on rumors.
A big question for me is size — your new flagship phone is 4.7 inches in size, so was your old one, and you have the 5-inch Droid DNA...
We think different people like different things. And we do have smaller phones as well.
Yes! But my question is, why do we not get flagship-class devices at smaller sizes? Why not 4 or 4.3 inches?
As a company, we have a portfolio and we aim to provide choice. We'll have new models coming out as well.
Why are you sticking to 4.7 inches? What is the reason for this form factor?
"At HTC, we don't try and define things, we just make a few and see how the market will like it."
Well, there's no reason, this is the way we designed it for this phone. That's it.
That must somehow relate to what you expect the consumer will prefer, right?
As I said, we have several designs, several form factors. We think that different people will like different form factors. That’s it. So we designed this form factor for people and they will embrace and celebrate this form factor.
Do you think this is the most popular form factor? What might be second after it?
This is one of the popular form factors, we believe. It is one for the mass market. At HTC, we don't try and define things, we just make a few and see how the market will like it. We're open minded about.
Let’s return to market execution. You said the problem previously was working with carriers, pushing. Now you’re going with a more streamlined, focused approach to find the particular consumer that your brand appeals to. Are you going to spend more of HTC’s budget on marketing?
We want to be driving a little more our own advertising approach to make sure that HTC will drive our own brand awareness and preference. That’s one of the things that we think that we need to be improving. Remember, HTC has only been around since ’07, and it has since become one of the recognized names in the world. We’re aware that we’re a young company. We’re learning. We like challenge. Challenge is good. It drives innovation and change.
The final question is, can you give us any idea about something to look forward to in the future? What is the next big thing that we might expect from HTC?
The whole company is driving to execute the way for HTC One.
HTC One is the near future. Let’s say a few months, a year down the line, what’s the next big thing to expect from HTC?
We’re very focused on this.
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