Is the red-hot smartphone market slowing down?
It is for one company: Taiwanese HTC, which makes smartphones based on Microsoft’s (MSFT) Windows Mobile and Google’s (GOOG) Android, said today that January sales dropped 17% year-over-year to roughly $297 million. HTC expects things to recover in February and March, resulting in low single-digit year-over-year growth in Q1. But that’s nothing like last year’s 29% full-year growth.
Is this bad news for other companies like BlackBerry maker Research In Motion (RIMM)? It’s certainly not good news. HTC says carriers and distributors are aggressively trimming down inventory, which is affecting Q1 shipments. That’s happening here, too: Verizon is offering buy one, get one free deals on several BlackBerry models, including the touchscreen Storm.
The good news for RIM: Unlike HTC, RIM is not wholly dependent on hardware sales. Much of RIM’s revenue (and investor attention) comes from its BlackBerry email service. So in this case, if Verizon can get more BlackBerry subscribers through Verizon’s promotion, that’s a good thing.