WP8 off to strong start as HTC ups production

WP8 off to strong start as HTC ups production
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HTC has stepped up production of its Windows Phone devices after the UK gave an encouraging start to Microsoft’s phone operating system.

The Taiwanese manufacturer had stock problems in the initial weeks after launch, as demand outpaced supply. However, it said the recent launch of new colours for the 8X and 8S devices will meet the appetite for the Microsoft OS handsets.

Phil Roberson, HTC UK and Ireland executive director, said: ‘We did have some stock shortages early on. We were seeing that demand was exceeding supply. As we go into the New Year, I am optimistic we will be able to start to meet all the demand.’

The move comes as retailers and operators alike report a better than anticipated start to sales of Microsoft’s latest phone operating system from both HTC and Nokia. Sales of this generation of devices have been higher than previous Windows Phone handsets, with Microsoft backing the devices with a marketing spend worth some £25m. Retailers and operator sources have told Mobile that customers have reacted strongly to the new handsets. Nokia was unable to disclose early sales of the devices, because of its impending Q4 financial results, but a spokesperson told Mobile it was ‘happy’ with the Lumia portfolio’s performance.

Microsoft is expected to launch a fresh advertising campaign this spring as it looks to build further momentum. Roberson (pictured) added: ‘We are really pleased about how Windows Phone is going and we have high hopes for it in 2013.’

Francisco Jeronimo, research manager at IDC, said despite the encouraging start made by the handsets, it is predicting the operating system will not make a major impact in its first 12 months after launch. However, by 2016, the agency said the OS will overtake Apple’s iOS to become the number two operating system globally.

Jeronimo said: ‘The fourth quarter was extremely important and gave consumers the opportunity to see devices at point of sale and try them out. Microsoft is investing a lot of money to promote it and generate knowledge about the platform, but we are expecting a slow growth in the platform this year.’
He added that confidence in the operating system will actually be bolstered by HTC running low on stock.

He said: ‘It’s no surprise demand is high, but you need to be careful in reading the numbers. It’s not as if HTC or Nokia is bringing Samsung or Apple levels of devices to market. It’s extremely important not to overproduce. It’s much better to manage higher demand than leave too many unsold handsets in a warehouse. That would not generate confidence among operators. Even if they sacrifice some sales it’s much better because operators will show confidence in the OS.’

Author: Graeme Neill

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