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The HTC One X debacle: winners and losers

May 19, 2012
htc one x
On Tuesday, news broke that US Customs had blocked imports of the HTC One X and the HTC EVO 4G LTE, effectively preventing HTC’s flagships from reaching American customers. The embargo was enforced due to an exclusion order by the International Trade Commission (ITC). The ITC ruled back in December that HTC’s Android devices infringe on two of Apple’s patents, but gave the Taiwanese a respite until April 19 to remove the infringing features.

Although HTC claims that both the HTC One X and the EVO 4G LTE are now free of the infringing feature, it seems that the US Customs needs a lot of time to decide if that’s truly the case.

The most immediate and visible effect of this incident was the canceled debut of Sprint’s EVO 4G LTE, which left many customers (some of whom have pre-ordered the device) furious. It’s easy to blame Apple for the whole snafu (if you’re an Android fan), but I also wonder what HTC did or could have done to prevent such a high-profile embarrassment. Even Sprint could come under fire for scheduling a device launch before knowing for sure when the device will be available.

Regardless of who’s to blame, it’s increasingly obvious that this indefinite delay will have real consequences for all the players involved. Here’s how I see the winners and the losers of the game.

The winners

  • Apple – Although many have interpreted Apple’s legal victory from last December as merely symbolic, it appears now that ITC’s ruling is more than just a bureaucratic measure. Apple actually managed to disrupt (even if it’s just for a few days) two of the iPhone’s bigger competitors. Moreover, this affair will show the other Android OEMs that losing against Cupertino can have dead-serious consequences. I am not sure if the other manufacturers are affected in any way by ITC’s decision, but at least at a symbolic level, Apple has shown its killer instinct. Oh yeah, and the iPhone will probably sell better now.
  • Samsung – somewhere in Korea, someone smiled when news broke about the HTC embargo. The One X is the main competitor to Samsung’s freshly unveiled Galaxy S3, and many say that HTC’s device is superior to the much hyped S3. Every little obstacle that the One X (in its various incarnations) faces is a boon for Samsung. Although the Galaxy S3 is not out yet in the United States, even a brief absence will erode the One X’ position in the market. If the delay goes on for another week or two, some potential customers might even switch sides, provided that the Galaxy S3 gets a launch date anytime soon.
  • Nokia and Microsoft the battered Finnish and their Redmond-based buddies certainly won’t mind that the Lumia 900 enjoys some extra days in the spotlight on AT&T. Although some stores still have the One X in stock, most AT&T retail locations don’t have HTC’s device available in numbers. This extends the window of opportunity for the Lumia 900, which has been Ma Bell’s hero device for the last month or so. Sales of Nokia’s flagship are reportedly good, and this misstep from HTC is likely to improve them.

The losers

  • Apple Yes, Apple. This case has highlighted the way Apple wages its legal war against Android, often based on patents for trivial features. In this case, it’s tapping a phone number to get a context menu, but that’s not really important. Most comments on the articles that covered this story revolve on the “Apple sucks for this” theme. And I am not talking just about the Android sites. It seems to me that people are tired of seeing big companies (Motorola, Samsung, and others included) harass each other, especially when it directly affects consumers, like it happened now.
  • HTC – obviously, the Taiwanese can’t afford this type of mishap now. We are not talking about the glorious HTC from 2010. Today’s HTC is bleeding money, and the One X is the shot in the arm that was supposed to bring the company back to life. Even if the delay doesn’t go on for too much, I am almost sure that we will see its impact when HTC’s quarterly financial results are announced. Samsung Galaxy S3 is already breaking records, and it didn’t even begin to sell. Another week of uncertainty could cost HTC dearly, and it would be too bad, because the One X really is a beautiful device.
  • Sprint – the third largest carrier in the US had passed through some tough times lately, making a big strategic error by betting on the Wimax standard instead of LTE. After admitting defeat and jumping on the LTE bandwagon, Sprint hoped that the HTC EVO 4G LTE would be its ticket to a new era. With the iPhone coming at a blistering price for the company (as CEO Dan Hesse admitted), Android should have been a breath of fresh air for Sprint. The damage is still limited for now, but if the delay continues for another week or so, the repercussions will follow.

Tell me what you think. Who is the biggest winner and who is the biggest loser? Does this delay affect your purchasing decision?