HTC One S for T-Mobile

Above: T-Mobile's HTC One S

Taiwanese phone manufacturer HTC has its eyes on the low-end mobile market, and it’s pushing forward with plans to develop its own low-cost mobile CPU together with ST-Ericsson, reports China Times.

While Apple and Samsung have high-end smartphone chips of their own, HTC would be taking completely the opposite approach with a low-end chip. The company, which is taking a beating in earnings, needs something beyond Android superphones to stay alive, especially since it looks like Samsung will dominate the high-end for some time. Building its own chips would give HTC a leg-up when it comes to making low-end Android devices, which seems to be an ever-increasing market for the platform.

When asked for comment, HTC said it wouldn’t comment on rumors or speculation.

According to the report, HTC has already signed a cooperation deal with ST-Ericsson (a joint venture between STMicroelectronics and Ericsson), and it has plans to start shipping devices featuring the new chip in 2013. The move may be partially in response to HTC’s growing issues with Qualcomm, as Unwired Review points out.

The question remains, is this a good idea for HTC? Even Nokia, traditionally a leader in low-end mobile devices, is now facing severe competition from Chinese manufacturers. HTC has never really paid much attention to the low-end market, so this would be entirely new territory for the company as well.

Now that HTC is less focused on pushing out countless phones, and more concerned about quality devices like the One series (check out our glowing review of the One S on T-Mobile), it makes sense for the company to take a closer look at cheaper devices. There’s plenty of room for innovation at the low end, and HTC can’t afford to let other manufacturers dominate cheaper devices either.

And honestly, it’s much smarter for HTC to invest in its own mobile processor, instead of silly investments like its recent $300 million stake in Beats Audio. The company needs to focus more on building quality devices and differentiating itself from competitors, instead of useless marketing gimmicks.

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