Google Purchase HTC Smartphone Division

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Google has just acquired the smartphone division of HTC for US $ 1.1 billion. Through this agreement Google does not purchase direct shares. Therefore, HTC will continue to be responsible for its smartphone business. Google is focusing on developing its own hardware division. Last year, they hired Rick Osterloh, a former Motorola executive, to head up their hardware division.

"For Google this agreement reinforces our commitment to make smartphones and become an investment in the hardware business we are developing," Google said in an official statement.

Google's strategy to eliminate Android licenses and benefit from extra services like search and maps makes Android the dominant mobile operating system in the market. Google's mobile OS that controls 89 percent of global market share.

The number of companies that make Android smartphones create an inconsistent usage experience. Meanwhile, if Google makes its own smartphone will complicate their relationship with other Android makers.


"HTC is no longer a leader in hardware design, especially since they have to cut back on their continued earnings in recent years," said Ryan Reith, an analyst at research firm IDC.

"Google's decision to acquire HTC will only benefit if they want to control the manufacture of hardware in other areas, such as Home and Chromebook."

HTC's market share, which once reached 10 percent of global market share, continued to fall as competition tightened with other smartphone makers such as Apple, Samsung and Chinese companies.

Moreover, the value of its shares also fell sharply in the past 2 years. This year, HTC shares fell 12 percent, making it valued at around US $ 1.9 billion.
 

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