Google Takes a Share of HTC

Google has recently announced a billion-dollar deal to acquire part of HTC’s smartphone operations.

It’s puzzling to some, but HTC are the natural choice for Google to make if they are planning to get more heavily into device development. They’ve partnered with Google before and currently manufacture the Google Pixel Phone. This deal just draws the companies closer together and puts their ongoing collaboration on a more formal footing.

Some people have questioned the wisdom of this decision on Google’s part. The days of HTC’s pre-eminence as a hardware manufacturer appear to be behind them. Formerly responsible for one in ten global sales of handsets, HTC’s market share has declined markedly in the face of competition from Samsung, Apple and emerging Chinese industry.

On the other hand, this injection of cash from Google and a closer working relationship with the minds behind the Android operating system could be the fuel HTC need to reinvent themselves and present some new exciting products to a market that’s always hungry for new developments.

For Google, there are a number of motives that could be behind this move: it could signal a desire to take more of a hand in mobile hardware development. Google’s phones have previously been rare releases and this could mean they’re planning more regular announcements of new technology similar to phone companies like Samsung and, indeed HTC.

It could also be a deal that puts them in possession of useful technology for their other ventures. A mobile manufacturer could offer valuable insights for Google’s Chromebooks, Chromecasts and other ways they wish to expand the ‘Chrome’ brand.

What we know, however, is that mobile is increasingly important to Google’s core: Search. As we’ve reported before, last year, for the first time more than half of all web searches were done on mobile devices. Google is already in the midst of preparations to roll out a ‘mobile first’ search index for its results, and is always trying to ensure it offers an optimal experience for mobile users.

In this context, it makes sense for Google to get more ‘skin in the game’ of mobile tech, garnering insights from the ground up that can help in its pivot towards the mobile environment.

And if we get a new generation of Pixel phones as a side effect, we’re hardy going to complain.