The Singaporean purveyor of digital music devices was considered a leader in
the field until it was puréed by Apple. The company, now worth one-twelfth
of its peak market capitalisation of S$2.3bn six years ago, has
printedlosses for 16 of the 24 quarters since then.
Its mistakes seem to have been noted by HTC of Taiwan, which is taking on
Apple – and others – in smartphones. Where Creative was scattergun, aiming
at a variety of market segments through the MuVo and Zen brands, HTC has
honed in on the high end.
Looks
Creative went big on features; HTC prioritised looks over function. It
produced design-heavy handsets such as Incredible, Desire and Evolution.
For an intrinsically covetable product, this was the right way to go. Most
significantly, HTC hooked up early with a credible technology partner:
Google’s Android operating system, which is on course to take almost
two-fifths of the global smartphone market this year, according to Gartner .
Only Samsung can rival HTC’s unit sales growth since 2007, in terms of global
handset share (from zero to 8.4 per cent). Analysts expect first-quarter
figures on Friday to beat management’s guidance on almost every line.
Challenges
Only 3 of 738 Taiex companies have done better than HTC’s 213 per cent return
over the past 12 months. This week its market capitalisation edged ahead of
fast-fading Nokia to $34bn; as recently as November 2007, the gap between
the pair was $150bn in the Finns’ favour.
Plenty of challenges lie ahead. Motorola recently launched the first tablet to
run the new version of Android, while HTC’s debut tablet has not yet hit the
shops. But for now at least, as a case study in how to take a nibble out of
Apple, HTC could hardly be bettered.
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