HTC and Nokia are seeing the effects of a poor global economic climate

Handset manufacturers are suffering the repercussions of a poor global economic climate as Finland’s Nokia has announced that it plans to delist from the German stock exchange next year, while Taiwan’s HTC has amended its sales forecast for 4Q11.

Nokia has applied for the delisting of its shares from the Frankfurt Stock Exchange due to the decreased trading volumes of its shares at the exchange. If approved, it will be delisted in the first half of 2012.

“Nokia’s trading volumes on the Frankfurt Stock Exchange have decreased during the years and currently represent only a small percentage of the total global trading volumes of the Nokia share,” the company said in a statement.

In 2003, 2004 and 2007 Nokia delisted from the stock exchanges in London, Paris and Stockholm respectively.

Nokia shares will continue to be traded within the Eurozone on the NASDAQ OMX Helsinki Stock Exchange and in the US on the New York Stock Exchange.

Meanwhile, HTC had predicted that revenues for the quarter would be up 20 to 30 per cent over 4Q10 earlier this year, but it has now revised that forecast.

The firm cited the global macro economic downturn and stiff market competition as reasons for adjusting its estimates but did not provide any updated financial information. However, market estimates suggest that the firm will see no increase in sales for the quarter over the same period last year.

The firm’s growth more than doubled in the first half of the year, but the revised forecast has seen its shares drop 7 per cent today, to their lowest in 16 months.

Apple's popular iPhone has not infringed HTC's patents, ruled a US court

The USA’s International Trade Commission (ITC) has ruled that Apple did not violate rival vendor HTC’s patents for technology used in its mobile devices. HTC had filed the complaint with the ITC last year seeking a ban on the import of Apple devices into the USA as part of an ongoing patent dispute between Apple and Android device manufacturers.

The ITC found that Apple’s devices did not violate four of HTC’s patents, which cover technology for looking up and dialing phone numbers and different techniques for managing power consumption on portable electronic devices.

While a final decision has to be approved by the full Commission, it is rare for them to overturn the findings from the Law Judge.

HTC said it is waiting to get a full copy of the ruling before it decides how to proceed, but is expected to ask the ITC to review its decision.

“This is only one step of many in these legal proceedings,” HTC General Counsel Grace Lei said in a statement. “We are confident we have a strong case for the ITC appeals process and are fully prepared to protect our intellectual property.”

The final determination from the Commission is due February 2012.

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HTC has been accused of tracking users' locations with its Sensation handset

HTC has become the latest mobile player to become embroiled in controversy over the tracking of users’ locations.

The Taiwanese handset manufacturer faces allegations that two of its handsets, the Sensation and Evo 3D, track users’ locations without permission. A new Android software update that was issued to these two handsets was found to have included tweaks that allow the OS to log users’ behaviour.

The allegations come just days after Microsoft found itself being sued in the US after it was accused of tracking the location of its smartphone users, while almost 27,000 Apple customers in South Korea are suing the firm for tracking their movements via their phones’ location.

However, HTC has defended its policy, claiming that the new functions are all tied to an opt-in service and that it is not spying on anyone.

The firm said that all of the data collected by the devices in question is encrypted, and the data collected by the process is only sent to HTC if the user has already opted in to an error reporting feature.

“HTC, like most manufacturers, has an opt-in error reporting function built in to our devices. If your phone experiences an error, you have the option of “Telling HTC” so we can make improvements to our phones,” the firm said in a statement.

“Details about this are in our privacy policy on each device and in order for data to be collected, you have to opt-in. If you do opt-in, we protect your privacy by de-identifing and encrypting the data. HTC is committed to protecting your privacy and that means a commitment to clear opt-in/opt-out as the standard for collecting any information we need to serve you better.”

The Titan is HTC's flagship WP7 Mango handset

Taiwanese handset vendor HTC has previewed two Windows Phone 7 smartphones to consumers across Europe, ahead of the products’ commercial release in October. The Titan and Radar handsets are the first from HTC to run the latest version of WP7, dubbed Mango.

While Microsoft revamped its mobile OS programme, HTC—once a firm that was described by executives as having “Windows in our DNA”—adopted Google’s Android operating system, establishing itself as one of the leading Android players. With the Titan and Radar the firm is demonstrating an ongoing willingness to work with Microsoft, although the allegiance is not what it was.

Nonetheless, the firm praised Microsoft’s new platform, with global sales and marketing chief Jason Mackenzie saying it allowed HTC to “raise the bar with advanced photography, multimedia and social capabilities”.

Microsoft’s close partnership with Nokia, announced early this year, was felt by some observers to run the risk of alienating other vendor partners. But Nokia has yet to release a product based on WP7, and has lacked conviction when voicing its desire to deliver a handset before the end of 2011. So it may be that WP7 remains more open territory for other vendors than it appeared early this year.

For vendors that have aligned themselves closely with Android, the recent announcement from Google that it is to acquire the handset division of Motorola might well have forced a rethink for the same reasons that the Microsoft/Nokia partnership gave them cause for concern. HTC, which has established leadership in both camps as it has sought to build its consumer brand, could prove a useful bellwether.

Dr Dre will be delivering Beats for HTC

Handset manufacturer HTC is upping its game in the youth market with the revelation this week that it will purchase a majority stake in high end headphone maker Beats Electronics, founded by rapper and producer Dr Dre.

HTC will pay out $300m for the 51 per cent stake, which it will use “to redefine the smart phone category and redefine the way that sound is heard.”

The handset firm will leverage the “cool” image of the Beats brand to boost its presence in the US and other markets, incorporating the firm’s specialist technology into products available before year end.

HTC is on a spending spree at the moment, with this latest venture marking the third investment in six weeks and the fourth this year. HTC has invested in cloud platform Dashwire, graphics firm S3 and content delivery platform Saffron over the past several months.

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The purchase gives HTC cloud services and patents

Taiwanese handset developer HTC has made another acquisition to beef up its patent portfolio as technology companies around the globe prepare to fend off legal disputes. HTC is reported to have spent $18.5m on the purchase of Dashwire, a mobile cloud platform developer.

Dashwire, based in Seattle and backed by Trilogy Equity Partners and Best Buy Capital, was founded in 2006 to develop cloud-based services allowing users to access their mobile content across multiple screens. HTC will integrate Dashwire’s cloud sync and device set up products into the HTCSense.com cloud services it launched last year.

“Cloud services are key to delivering the promise of connected services to our customers,” said Fred Liu, president of engineering and operations at HTC.”People want access to all of their important content wherever they are on any device. The addition of Dashwire’s cutting-edge sync services and deep mobile cloud experience strengthens our ability to deliver these services in a more powerful way.”

In July, HTC snapped up long term partner S3 Graphics from Taiwanese chip maker Via Technologies for $300m, giving the handset firm 235 patents, mostly related to graphics technology, to bolster its portfolio.

HTC is currently at legal loggerheads with Apple, as the big industry dust up over who’s copying who drags on.

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HTC has scored a patent power up

The race to bolster patent portfolios continued apace in Taiwan this week as burgeoning device vendor HTC snapped up a graphics processor firm and long term partner.

HTC acquired S3 Graphics from Taiwanese chip maker Via Technologies for $300m and is probably glad to get rid of it. VIA acquired S3 in 2001 with the intention to accelerate integration of graphics capabilities with its processor and chipset products, but the new purchase became undercapitalised in 2005 and VIA introduced WTI Investment International as a new investor to bail S3 out.

Eyebrows are being raised over HTC’s move this week however, as Cher Wang is not only chairman of VIA, but is also a significant shareholder in WTI and co-founder of HTC.

Under the terms of the agreement, VIA will receive $147m and WTI will receive $153m of the purchase price, while VIA will recognise a capital gain of $37m for getting shot if S3.

In terms of IP, HTC will acquire 235 patents, mostly related to graphics technology, to bolster its portfolio. HTC is currently at legal loggerheads with Apple, as the big industry dust up over who’s copying who drags on.

HTC’s Sensation devices are sold in China by China Mobile and China Unicom

Taiwan-based device manufacturer HTC is looking to broaden its reach in both China and Europe with announcements of expansions into both markets. In the case of China, the company has announced its plans to increase the number of retail outlets there from 630 to 2000 by the end of 2011. With a market 10 times bigger than Taiwan’s, where HTC is the dominant player, China could be a lucrative revenue stream for HTC if it can take on Huawei and ZTE, both of which have been paying increasing attention to western markets lately.

According to reports in the Taiwan Economic News, senior HTC executive Fred Liu has said that the device maker’s expansion on the Chinese mainland is not just about retail, but will also involve significant research and development investment. According to Liu, it is anticipated that R&D will expand to four times its current project size in China and will include work on time-division (TDD) flavours of wireless network technologies. HTC recently released its Incredible handset in partnership with China Telecom; TD-SCDMA and WCDMA versions of its Sensation handsets are currently available through China Mobile and China Unicom.

Over in Europe, meanwhile, HTC today opened its new European and UK headquarters in Slough in England. According to a press release issue by the company, its new HQ “symbolises the rapid growth HTC has experienced” in the region in recent times. The device maker’s European operations now cover more than 50 territories; according to HTC, smartphone sales across the EMEA region for Q1 2011 increased 67 per cent on the previous year. The UK HQ building, which was previously occupied by O2, will house senior management, marketing and engineering teams and “provides additional space for nearly 150 new positions to be created over the coming 12 months.”

VoLTE could level the playing field for operators under threat from OTT players

Figures from industry body the GSA (Global Mobile Suppliers Association) reveal that 208 operators in 80 countries are now investing in LTE. But while rollouts aimed at consumers are gaining momentum, a study undertaken by research house mobileSquared indicates that one third of operators have no trials or network deployments underway at the moment.

Although these operators said they expected to deploy LTE at a future date, almost a quarter of those surveyed said they had yet to make any decision on LTE because of spectrum or cost issues.

With none of the 38 operators surveyed by mobileSquared believing that LTE handsets would be widely available this year, it’s hardly surprising that 34 per cent of respondents thought that LTE would not become a viable consumer offering before 2013; a further 18 per cent said that 2014 was a more feasible date. According to mobileSquared, this timeframe ties in with a number of operator announcements: AT&T plans to introduce voice over LTE (VoLTE) by 2013 after an initial roll out of circuit-switched fallback (CSFB) and has begun integrating its IMS architecture.

Verizon Wireless, meanwhile, plans to launch VoLTE services in 2012; MetroPCS, having partnered with HTC to roll out a VoLTE-enabled handset, is planning trials for the voice technology later this year.

According to mobileSquared, the adoption of VoLTE by operators is “significant on a number of levels”. Key among these is the price point for IP-based communications. With revenues for voice over internet pricing models close to zero, carriers will be “forced to innovate in terms of how services are offered, packaged and priced,” according to the report. As such, “The most obvious option is to bundle Unified Communications (UC) and Rich Communications Suites (RCS) in a single address book, enabling users to track presence, IM, voice and video calls all with the same identifier – the mobile phone number.”

The report further adds that quality of service (QoS) on connecting network-based mobile VoIP calls will be so much better than over-the-top (OTT) services that a “de facto two-tier system” will be created. “A VoLTE call would be explicitly indentified in the operator domain as real time conversation and routed with low latency transit from network to network, whereas an OTT call would be treated as traditional data on the internet,” according to mobileSquared.

The report, which was sponsored by Broadsoft, concludes that mobile VoIP and the introduction of VoLTE  have levelled the playing field for operators under pressure from OTT players and possibly even given them a competitive advantage, as associated UC offerings that specifically target the business market could prove lucrative. With this last point in mind, it seems that any operators should consider a change in current strategy: 45 per cent of those surveyed admitted that they did not feel they were well positioned to sell LTE as an enterprise solution because of their retail focus. The report concludes that these carriers are missing an opportunity by “not adjusting their business model to include a direct sales force focused on selling more than just minutes of voice to enterprise customers.”

HTC is on the hunt for device-specific Android apps

As Android’s march towards mobile OS domination appears to continue unchecked, device manufacturers are joining the scrum to differentiate themselves from the competition. HTC has joined the ranks of manufacturers increasingly looking to pull in the developers to create device-specific apps,  announcing a dev-friendly programme to be launched in parallel with an SDK for its Sense user interface.

According to HTC, HTCdev, which is scheduled to launch this summer, will feature access to “an extensive resource library of tutorials, best practices, documentation and support” through a new web site www.htcdev.com. The site will also offer a user feedback channel to HTC “for ongoing investments and improvements to the developer toolset and program resources.” The scheme is aimed at encouraging  developers to work on applications specifically for HTC devices.

HTC says that the OpenSense SDK will be the programme’s “core offering” that will enable Android developers to “more deeply integrate into the HTC Sense 3.0 experience.” The framework will also offer APIs and sample code for 3D display and the tablet pen.

HTC isn’t the only device manufacturer courting developers. Motorola is among those offering Android developers a support system and Samsung launched its developer forum in May this year. Samsung’s programme includes a remote test lab feature that allows developers to install and test applications on Samsung devices over the web.