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HTC to stop all phones sales in Brazil

June 22, 2012

Brazil is soon going to become the 4th largest country of smartphone buying customers, by replacing UK from their current 6th position. So it seems very unfortunate for HTC to have to cancel their planned One series launch for the country, but even more importantly to leave the country altogether. They had 27 million smartphone owners; 9 million smartphones were sold last year alone.

When called for confirmation by AndroidPIT, a HTC executive from Brazil had this to say: “after analyzing the sales numbers, we have decided to pull out of the Brazilian market.” It seems HTC couldn’t even get 1% market share in the country, and their share has been dropping ever since they stopped producing smartphones in Brazil. The Brazilian government “punishes” companies that aren’t manufacturing their devices in the country by increasing their taxes, which means that HTC’s phones have always been more expensive than competition for the same hardware.

But HTC seems to have had some strategy missteps in Brazil as well. They haven’t offered very good phones to Brazilian customers, other than some  low-end/mid-range phones like the HTC Wildfire, when their biggest competition, like Samsung and Motorola, were offering smartphones like Galaxy S2 and RAZR. They do say they are planning to bring the One series to Brazil, but since they aren’t gaining any momentum in the country, and Galaxy S3 is also launching now, they have decided against it and they will halt all sales in Brazil.

Samsung is doing very well these days, but HTC seems to be at the crossroads right now. I think they need to focus a lot more on bringing innovative features and devices to market, and less on the “sales” aspect of the process, where they try to sell a new tweaked version every couple of months. That being said, I still look forward to see what their Nexus device will be like this fall, among all the other Nexus devices. If they can beat everyone else, it would be a big deal for their image.