- 2018-11-12
Who gains and loses when Google buys HTC?
The long-rumored transaction between HTC and Google was officially made public on September 21. Since then, a large number of comments have emerged, concerned about where HTC will go and whether it will withdraw from the smartphone market? On the contrary, for Google, which has to pay 1.1 billion US dollars, the comments from the outside are only as "Google needs to build its own hardware capabilities." Is this transaction really that simple?
In contrast to the outside world’s worries or bad news about HTC, the stock price of HTC after the resumption of trading rose by 10% as soon as the market opened, directly attacking the stop price, and hanging up 400,000 buy orders. Such stock price performance means that while the outside world is still enthusiastically discussing the impact of this transaction on HTC, the sensitive stock market has already voted with practical actions.
Because, in this transaction called the cooperation agreement, HTC almost took what it was supposed to take and gave it away. In one go, HTC got 1.1 billion U.S. dollars in cash. It also dealt with team employees who might have to spend a large amount of severance pay or under the pressure of criticism of layoffs. This deal was not only unharmed for HTC, but also a full return.
According to Taiwanese media reports, this time HTC’s “cutting love” transfer to Google’s R&D team employees are all the team that designed and developed Pixel phones for Google. Except for VR and other product line R&D teams, it is estimated that HTC’s personnel in this change account for about 70% of its smartphone R&D team.
Such numbers may sound horrifying at first, but if you look closely at them, you must also talk about a question: Are smart phones still important to HTC?
HTC: Smart phones are no longer the focus of development
In fact, in Taiwan’s industry, everyone knows that it will be a matter of time for HTC to shrink or even actively or passively fade out smartphones, because this is a market that HTC knows that it cannot win back. Therefore, HTC’s next most likely action in smartphones is to reduce the number of new phones launched, and will only focus on a single flagship model, and may even lengthen the time to launch flagship models. Simply put, smart phones will no longer be the center of gravity of HTC.
The same strength can be seen from the fact that HTC has been actively betting on VR (Virtual Reality) or future MR (Mixed Reality) product strategies in the past two years. Although many people speculated that HTC would sell its VR division when it was previously reported that HTC would be trading with Google, such speculations actually did not understand the logic of HTC. As far as HTC is concerned, VR is the next opportunity for HTC to regain its popularity. It is impossible to give up anything.
Just as HTC Chairman Wang Xuehong said at a press conference held with Google: "VR and MR can realize dreams that humans can never realize in real life, and they can bring a wave of opportunities for revolution to the world." It is not just a comment on VR technology, but also Wang Xuehong's heartfelt words on the importance of VR to HTC in the future. Because VR will be the only opportunity for HTC to dream of succeeding again in an operating situation that has been unable to recover.
Google: In addition to Apple, but also to face the threat of Amazon
Looking back at Google and taking over the HTC Pixel R&D team, it did make the outside world see Google’s determination to regroup in the field of hardware devices, but just like media comments, compared to the $12.5 billion acquisition of Motorola that year, 3.2 billion. The US dollar acquisition of Nest, this time receiving part of HTC’s R&D team for US$1.1 billion, is actually just a test of Google’s hardware device layout. If it is to be said that Google hopes that through this cooperation agreement, it can immediately make its own hardware department Performance, I am afraid it is an exaggeration.
Some comments mentioned that the main goal of Google choosing to cooperate with HTC in this way is to fight against Apple and build a smartphone that can rival the iPhone. For such a statement, it is actually a bit confusing. Everyone knows the situation of the smart phone market. In a highly competitive and highly standardized environment, this is no longer a "one machine to win" market, even for Apple. And Google wants to build its own hardware team, and then build a large-scale foundation of its own hardware devices, and then realize the dream of future technology application services on these hardware devices. The logic that seems to be smoothly formed, but it hides too much simplification. Inference.
In fact, Google’s current biggest crisis may not lie in the smartphone market of Android system, but in the market of new types of applications such as smart homes and intelligent voice assistants other than smartphones. Because, seeing Amazon’s Alexa has become the system of choice for many hardware device manufacturers, how can Google not be anxious, it is clear that Amazon is following the successful model of Android at the time, and gradually expanding in smart homes and smart homes. The power of the voice assistant market.
The hot sale of Amazon's smart speaker Echo is just the beginning. Alexa, AWS IoT platform, and even AWS public cloud services have all surprised Google. Therefore, Google is actively constructing hardware equipment resources. In addition to Apple, Amazon's threat is even more in the throat, so Google has to speed up its actions.
It is undeniable that Google is not familiar with the hardware device market, and is also very unfamiliar with the most important supply chain of hardware devices. Although some people believe that in the past few years, Google’s control over the supply chain due to hardware products such as Chromebooks has improved compared to the past, but everything in the world is not absolute, but relative. Compared to Apple, Amazon or Microsoft, Google is supplying In the world of the chain symbiosis system, there are still little white rabbits who have just entered the jungle.
As Qian Zhongshu said in the novel "Siege": "Marriage is like siege. The inside wants to come out and the outside wants to go in." The same goes for the wars between Google and Apple and Amazon. Most people can understand why Google wants to buy this team. Although $1.1 billion is not a problem for Google with ample cash, it is not a small amount of money.
At this trade press conference, some media asked: "Instead of using US$1.1 billion to cooperate with HTC, why not invest in the development of its own chips?" However, Google executives did not answer this question head-on, but kept emphasizing the integration of HTC. The resources of the hardware R&D team, coupled with Google's software and cloud capabilities, will be able to create more innovative hardware devices.