Sprint Nextel Corp plans to sell a touch-screen phone from Taiwan's High Tech Computer Corp this holiday season, hoping to help stem customer losses to Apple Inc's iPhone, which is only available from AT&T Inc.
Like iPhone, HTC's Touch -- set to go on sale on November 4 -- lets users surf the Web or navigate their photo albums by moving their fingers across a touch-sensitive screen. But at $249.99, Touch has a lower price tag than iPhone's $399.
Current Analysis analyst Avi Greengart said the Touch would not sway determined iPhone fans, but he expects the pricing to give Sprint, the No. 2 U.S. mobile service, a fighting chance.
It gives Sprint a strong competitive response to the iPhone even if it won't convince somebody who specifically wants an iPhone to desist, Greengart said.
Sprint, which is seeking a new chief executive amid market share losses, will be looking for the HTC phone to help it compete against market leader AT&T, which has exclusive rights to sell iPhone in the U.S. for at least two years.
Verizon Wireless, a venture of Verizon Communications and Vodafone Group, also recently disclosed plans to sell two LG Electronics touch-screen phones in time for the holidays.
Danny Bowman, Sprint's vice president for customer equipment, said he believed the Touch would be attractive to different market segments, including college students who will use it for both work and entertainment.
More than 1 million iPhones have been sold in the United States since late June. In comparison, HTC has sold 800,000 Touch phones since the product launched in Europe and Asia in June.
Sprint's Touch has an improved virtual keyboard, a new feature that lets users use their fingers to zoom in on photographs, and a processor that is twice as fast as the earlier version of the device being sold in Europe.
Apple's iPhone already has 8 gigabytes of internal storage space whereas Sprint customers would need to pay extra for a 4 gigabyte memory card to store songs or videos in the Touch.
But while iPhone does not run on AT&T's fastest data network, the Touch will run on Sprint's high-speed network. And the Touch, which runs on Microsoft Corp software, supports corporate e-mail, unlike iPhone.
This is a more advanced device if you compare it to iPhone, HTC Chief Executive Peter Chou said in an interview. The product position is quite different.
Chou would not disclose HTC's targets for U.S. sales. He noted that Touch sales in Europe and Asia had exceeded the company's expectations, adding that he would have been happy with 500,000 unit sales.
Asked if the U.S. Touch would be as profitable as the European version, Chou said it was more costly to make, but he would not give specifics.
The executive said that U.S. growth had been weaker than expected for HTC this year due to product launch delays, but he expects improvements, in part because of the Touch launch. Next year ... the U.S. should be pretty good, he said.
HTC recently unveiled the Touch Dual, which has a standard keyboard function as well as a touch screen.
Bowman said Sprint hoped to have a touch-screen phone that comes with a standard keyboard next year, but would not say if it would sell HTC's latest device.