ARTICLE BY CLIFTON DAWSON
HTC Corp, the Taiwan-based maker of the Vive virtual reality platform, is reported to be exploring strategic options from spinning off its VR business unit to selling itself, according to a Bloomberg report from earlier this week.
This is the not first report of HTC exploring its strategic options. Back in June 2016, reports emerged on The Verge and other sites that HTC was considering selling off the Vive business unit. Shortly after the rumors, HTC confirmed that it was not selling its unit, and instead turning the VR business unit into a wholly-owned subsidiary called HTC Vive Tech Corporation.
HTC Trouble: Less About VR, More About Phones
The company, which is a leading provider of smartphones, tablets, cameras, and other telecommunications equipment, has been trying to turn around its business by focusing on high-end VR headsets.
Since 2015, consolidated monthly revenues have declined consistently, but one growing segment is VR. “As of the first quarter of 2017, HTC has captured a significant share of the PC-tethered VR headset market, according to research from Greenlight Insights. “Their share of the total VR/AR headset market is a very small percentage since the total market includes popular smartphone-based headsets from Samsung and Google”.
The Vive Platform As HTC’s Growth Engine
Since the Vive’s highly-anticipated launch in February 2016, HTC’s management has strongly supported the upstart division inside the world’s third largest smartphone manufacturer. Last year, HTC CEO and co-founder Cher Wang said, “VR is more important to HTC than its lumbering smartphone business”.
Instead of selling the business unit, HTC will likely continue investing in the platform. In fact, in March of this year, HTC sold a Shanghai-based phone production plant and stated it intended to use the proceeds fuel its growing VR business.
Clifton Dawson, CEO of Greenlight Insights, as an analyst covers digital disruption and how today’s company are transforming their business models to deliver next-gen experiences through virtual and augmented reality technology. Follow him: @AskClifton.