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HTC chief downplays Apple patent case with ITC, calls it a 'distraction'

HTC Chief Executive Peter Chou attempted to calm investors on Friday by calling a recent ruling from the International Trade Commission, which found the Taiwanese handset maker guilty of infringing on two of Apple's patents, a mere "distraction" that will not affect his company's business.

At an investor conference on Friday, Chou said the company expects to grow revenue in the third quarter 80 percent year over year to NT$137 billion ($4.74 billion), The Wall Street Journal reports. He remained confident that the company would be unaffected by Apple's suit with the ITC.

The executive also reassured that HTC's recent purchase of S3 graphics would quickly prove worth its $300 million price tag. It has been suggested that the smartphone maker purchased S3 Graphics in order to gain leverage in its negotiations with Apple, which was recently found to be infringing on two of the graphics company's patents. Shares of HTC have slid 20 percent to NT$858 ($29.71) since the company announced its acquisition of S3 graphics.

Apple sued HTC last year, alleging that the company had violated several of its patents. Earlier this month, the federal agency issued an initial ruling in the iPhone maker's favor. Some industry watchers have said that the decision, if upheld by the commission, would be a devastating blow to HTC and Google's Android platform.

According to the report, Chou also indicated the company was "carefully assessing the tablet market" and would become more competitive in the space next year.

Chou reaffirmed the company's continued ability to grow, innovate and release quality products. HTC forecasts third-quarter smartphone shipments will jump 98 percent to 13.5 million units. The company shipped 12.1 million handsets in the June quarter. By comparison, Apple shipped 20.3 million iPhones in the same period, overtaking Nokia to become the world's largest smartphone maker.

However, analysts have voiced concerns over the company's long-term growth prospects. HTC's head of innovation Horace Luke, who played a significant part in the company's rise from contract manufacturer to global smartphone brand, left the company in April of this year. Capital Securities analyst Diana Wu said investors will be anxious to see what HTC can come up with after the last devices Luke helped design arrive in the first quarter of 2012.

22 Comments

agramonte 14 Years · 345 comments

Digitimes reported that they already had a workaround if they loose for next year

http://www.digitimes.com/news/a20110726PD213.html

cloudgazer 14 Years · 2161 comments

Quote:
Originally Posted by agramonte

Digitimes reported that they already had a workaround if they loose for next year

http://www.digitimes.com/news/a20110726PD213.html

Well they're hardly likely to say anything else are they? I would take that with a big pinch of salt. The DSP patent particularly seemed to be hard to wriggle out of.

agramonte 14 Years · 345 comments

Quote:
Originally Posted by cloudgazer

Well they're hardly likely to say anything else are they? I would take that with a big pinch of salt. The DSP patent particularly seemed to be hard to wriggle out of.

probably not - guess we will see come november

deewin 15 Years · 34 comments

I'm pretty sure it's just more than a distraction if Apple is legitimately suing them for technology they have a patent on. I don't think Apple is being a patent troll here and one of the reasons why they patent their technology is because they put a lot of R&D into this and they can have an advantage over the competition. HTC hopes apple will license their technology because they know they are screwed but I really don't think Apple will do that because they created the technology for use with their devices only and not license it out to the competition. Google most certainly isn't gonna help HTC financially because not only is that too much money involved but that would mean they would have to help all their hardware partners involved with Android which is way too much. This is part of the reason why they said they would make sure HTC wouldn't lose the lawsuit, which doesn't seem to be the case so far.