Google reportedly close to buying HTC assets to bolster hardware

Taiwan’s HTC, which has its U.S. headquarters in Bellevue, once ranked among the world’s top smartphone makers. It partnered with Bellevue gaming giant Valve to build Vive, one of the major high-end virtual-reality headsets.

Google is close to acquiring assets from Taiwan’s HTC, according to a person familiar with the situation, in a bid to bolster the internet giant’s nascent hardware business.

By owning a manufacturer outright, Google could gain tighter control over production of its new Pixel smartphone and other devices, helping it ramp up sales. Those gadgets are fast becoming the pillars of Google’s strategic push to keep critical software products, such as its voice-enabled assistant, in circulation, contain costs in its main advertising business and better compete with Apple.

HTC has its U.S. headquarters in Bellevue. It partnered with Bellevue gaming giant Valve to build Vive, one of the major high-end virtual-reality headsets.

HTC, once ranked among the world’s top smartphone makers, is holding a town hall meeting Thursday, according to tech website VentureBeat, which cited a copy of an internal invitation. The shares will also be suspended from trading as of Thursday due to a pending announcement, according to the Taiwan stock exchange.

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Google declined to comment, and HTC couldn’t immediately be reached for comment.

HTC has been working with an adviser to explore selling its handset and virtual reality businesses, and Google has been talking with the company, Bloomberg reported last month.

Apple Daily reported Wednesday that Google will buy HTC’s mobile-phone original design operations for about NT$10 billion ($330 million). Google will keep the HTC brand and take on about 100 HTC engineers, the website reported, citing unidentified people familiar with the matter.

Alphabet investors may be concerned about history repeating itself. Google has tried to buy its way into hardware twice before, albeit more expensively. Those efforts largely fell short and the associated expenses slimmed Google’s margins. But its third try comes at a very different time — when Google and its biggest rivals are more focused than ever on consumer devices built around artificial-intelligence services.

Greater control over hardware production would give Google more power over the distribution of those new services, like its voice-based digital…

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