November 20, 2012
HTC’s Chou Calls Out Analysts On Outrageous Predictions Regarding Apple Settlement
Michael Harper for redOrbit.com — Your Universe Online
A little over a week ago, Apple and HTC announced they had reached a 10-year licensing deal, ending their legal squabbles, keeping them out of court and working to protect the sanity of customers and tech watchers alike. The two companies never released specific numbers or terms in their press release, only saying the terms were “confidential.”
This didn´t stop analysts from having their say, of course. In letters to investors and interviews with the press, analysts began making all sorts of informed decisions about this deal, and now, HTC´s CEO Peter Chou is having his say, calling these predictions “outrageous.”
When the two phone makers made their announcement, many became quite curious as to what these terms might be. After all, it wouldn´t be Apple without a big question mark and a hoard of analysts and journalists trying to unlock the code. One analyst spoke with Business Insider, claiming HTC would now have to pay Apple $6 to $8 per phone as a part of the licensing agreement. Shaw Wu, analyst with Sterne Agee, said he had arrived at this number after having "conversations with industry sources.”
Today, Peter Chou spoke with members of the press and, when asked about his company paying Apple $8 for every phone they sell, he was very forthcoming about his opinions on the matter.
"I think that these estimates are baseless and very, very wrong,” said Chou, speaking at a KDDI Corp product launch in Tokyo.
“It is a outrageous number, but I'm not going to comment anything on a specific number. I believe we have a very, very happy settlement and a good ending,"
Based on Wu´s $6 to $8 claims, Apple could stand to earn quite a bit of money from HTC next year. According to Appleinsider, HTC would pay out between $180 and $280 million next year alone, based on HTC´s estimate to ship in between 30 and 35 million Android phones next year.
"This is apparently lower than the range AAPL initially proposed," Wu wrote in his letter to investors last week.
"But to put this in context, this compares to press reports indicated HTC pays (Microsoft) $5 per phone running Android."
Peter Chou likely takes these inflated claims very personally.
HTC´s chairwoman Cher Wang gave a public statement today, saying she fully trusts her CEO. “Regarding the recent settlement between HTC and Apple, it was Mr. Chou who led the negotiations“¦ the CFO wasn´t involved at all,” said Wang.
Apple and HTC began their fight in 2010 when Apple launched a lawsuit against the Taiwanese company. Apple sued HTC for infringing 20 iPhone patents related to the hardware, software and user interface. While this suit came out of the blue for HTC, it was seen by many as the first in a long list of suits against Google´s Android rather than a suit against these specific companies. Now that Apple´s settled with the company they first lodged a complaint with, some began to wonder if other companies, like Samsung, may be next.
As it stands, this seems unlikely, as Samsung issued their own statement shortly after the Apple HTC deal was announced, saying they had no intention of settling with Apple.