HTC is having talks with Micromax, Lava, and Karbonn to have a potential licensing agreement in order to raise some extra cash without having to incur the costs associated with phone manufacturing.
The agreement would let the Indian manufacturers use HTC brand-name in return of royalty for each device to HTC. In such an arrangement, HTC can have a say in matters of design but it cannot dictate the pricing and specifications.
The ultimate result of such licensing would be that HTC will now become a budget and mid-range phone as the Indian manufacturers belong to these segments. That, in turn, would mean that HTC will face intense competition from Xiomi, Oppo, and Samsung plus others.
There has been no report, however, of HTC having similar talks with non-Indian foreign firms but since the company is most likely to follow Blackberry’s steps, it can also have talks with manufacturers from other countries.
HTC is trying to cut its costs drastically while focusing on its VR business segment, and licensing is the most useful strategy to do this. That, however, does not guarantee HTC that its tough times will go away soon enough.