HTC Studying Whether To Have Own Smartphone Operating System

HTC Corp., Taiwan’s largest mobile phone maker, is researching whether to equip phones with its own operating system - a move that may intensify competition with Apple, Google, and Microsoft. “We continue to assess, but that requires a few conditions to justify” having our own system, Cheng Hui-ming, the Chief financial officer of the Taoyuan Taiwan-based company, said in a phone interview today. HTC’s own operating system would enable the company, which designs and produces phones using Google and Microsoft software, to reduce its reliance on outside developers. The company is among the possible bidders for Palm Inc, three people familiar with the situation said this month.

“If you look at the successful smartphone players, like Apple and Research in Motion, a reason for their success it hat they have their own platform,” said Steven Tseng, who rats HTC “buy” at RBS Asia Ltd. In Taipei and favors the company having its own operating system in the long term. “The negative is the amount of resources they would need to allocate.” Cheng declined to comment whether HTC has studied Palm for a possible acquisition. The company does not have a timeframe for deciding whether to have its own platform, he said.

“There are many multiple factors to be considered together, rather than a simple statement as to own or not to own” proprietary software, Cheng said. HTC did decline 1.4 percent to close at #389 in Taiwan trading.

As of right now, Palm is working with Goldman Sachs Group and Frank Quattrone’s Qatalyst Partners to find a buyer possibly as early as this week, according to people that are familiar with the company’s situation. These people declined to be identified because a sale hasn’t been announced.

HTC is the world’s largest maker of phones using Microsoft’s Windows Mobile platform and was also the first to be release a handset based on Google’s Android. This year, it unveiled its low-cost Smart mobile phone based on Qualcomm’s BREW system.

The market share of smartphones using Palm’s WebOS was 0.7 percent in 2009, while handsets using Symbian, Nokia’s main smartphone software, accounted for 46.9 percent, according to Gartner Inc. Research In Motion Ltd.’s Blackberry had 19.9 percent, Apple’s iPhone 14.4 percent, and Google’s Android operating system 3.9 percent, according to the February statement from Gartner, of Stamford, Connecticut.

Time will tell what path HTC chooses; stay tuned for more info by following us on twitter, and subscribing to our RSS feed.