Friday 8 September 2017

Google planning to buy HTC's smartphone division.

Google might buy HTC's smartphone division, report claims that negotiations are almost complete.

Google planning to buy HTC's smartphone division.

Tech giant Google is expected to buy the Taiwanese smartphone manufacturer HTC. According to a PhoneArena report HTC is not in a good financial condition as August 2017 was one of the worst months for the company. Revenue has reportedly fallen by 51.5 percent compared to last month, and by as much as 54.3 percent compared to August last year.

The company's only flagship device, the HTC U11 is only a few months old, but it's already too late to save the company's revenue. As PhoneArena notes, those who wanted the phone have bought it, everyone else is either happy with what they have or are waiting for the next wave of flagships.

According to the report, the Taiwanese smartphone manufacturer is in the "final stage of negotiation" for the sale of its business to tech giant Google. The report, which cites Commercial Times, a Chinese publication, mentions two options that Google is considering. Google will either become a strategic partner of HTC or it will buy the entire smartphone unit. The HTC Vive VR unit is not part of the negotiations.

HTC manufactured the Google Pixel and Pixel XL, but the new Pixel devices are expected to be manufactured by HTC and LG, with LG making the larger device.

In our opinion, a sale of this nature certainly makes sense for both parties. HTC is a capable device manufacturer and simply lacks brand value and the appeal of rivals like Samsung. Google is just getting into the premium devices business and HTC's expertise in this regard will be invaluable.

The value of the deal, if it happens, will be interesting to note considering that Google bought Motorola Mobility for $12.3 billion in 2011 and then sold it to Lenovo for $12.4 billion in 2014.

Following the Commercial Times' report, HTC's shares apparently fell by eight percent in just one day. HTC declined to comment on "rumors and speculations" in the market.

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