Google and HTC signs US$1.1 Billion deal to develop premium smartphones

Google and HTC have just signed a big agreement to develop premium smartphones of future. The duo today announced a definitive agreement under which certain HTC employees - many of whom are already working with Google to develop Pixel smartphones - will join Google. As per the deal, HTC will receive US$1.1 billion in cash from Google. Separately, Google will receive a non-exclusive license for HTC intellectual property (IP).

It is big decision for both the tech giants and the agreement is a testament to the decade-long strategic relationship between HTC and Google around the development of premium smartphones.

HTC will continue to work on the next flagship phone, possibly the successor of HTC U11, and Google will take care of the Pixel series of handsets wholeheartedly. Moreover, Google will not interfere in any other segment and HTC will continue to build the virtual reality ecosystem to grow its VIVE business, while investing in other next-generation technologies, including the Internet of Things, augmented reality and artificial intelligence.

For Google, this agreement further reinforces its commitment to smartphones and overall investment in its emerging hardware business. In addition to the talented and experienced team of professionals, Google will continue to have access to HTC's IP to support the Pixel smartphone family. Additionally, this agreement also represents a significant investment by Google in Taiwan as a key innovation and technology hub.

With this deal, we can expect some really advanced mobile devices backed by Google's software expertise and HTC's hardware prowess. However, it is also worth noticing that HTC has to make sure that the company develops some true flagships in the coming months and years to get going in the market. Samsung, Sony, Motorola and other brands are already giving a tough fight to tech giant.

Both the companies expect to have the deal finalized pissibly in the first or second quarterof 2018.