HTC M8 for Windows – Hearts and wallets

Microsoft needs to appeal to the user’s heart not just his wallet.

• HTC has launched an virtual clone of its flagship HTC One M8 with two main differences from the original:
• First, it is running Windows Phone 8.1 instead of Android / Google Mobile Services (GMS).
• Second, after the subsidy, it is half the price of the Android / GMS version at $99 with a two year contract instead of $199.
• The unsubsidised price of the original is $670 and I suspect that this device will be $100 less (i.e. $570) if purchased without a contract. .
• HTC is in no position to make such a concession and I suspect that Microsoft will be providing HTC with marketing support of $100 per device.
• Unfortunately, to make this device, as well as its own devices successful, appealing the user’s wallet is only half of the story.
• Microsoft has only 3.2% share of the smartphone market and majority of these are the Lumia 500 and 600 series which are cheapest phones that the company makes.
• This clearly indicates that price will only get one so far.
• These are a great choice for a budget conscious smartphone user as he gets a lot of smartphone bang for the buck in terms of hardware specification and camera capability.
• The user also gets access to an ecosystem that offers a comprehensive range of services within which he can live his Digital Life but I suspect that almost all of these users are unaware of this fact.
• This is where Microsoft must step up and educate users about what it has to offer.
• Windows Phone is a very different experience to both Android and iOS both which are now so prevalent that they sell themselves.
• Microsoft does not have this luxury and it must show users what the ecosystem is capable of before there will be any meaningful uptake.
• This means having live devices at the point of sale that are populated with typical user data so that users can really see how it will benefit them.
• This is still very far from reality and until it starts to happen I think it unlikely that the ecosystem will gain much traction.
• Appealing to the consumer’s wallet will only get Microsoft so far, it must also win his heart.
• This is why I suspect that only a handful of these devices will sell despite the $100 discount being offered.
• This is a minor issue for HTC which continues to struggle with its lack of scale and differentiation leaving it unable to turn a decent profit.
• I see no real strategy at HTC to change this state of affairs and remain fearful for the long term future of this company.