A thousand HTC engineers write an angry letter to Peter Chou. 60% R&D slash secret is out, staff gets restless

About a year ago, just as HTC troubles were getting into a full swing, I noticed a very strange blip in one of their quarterly reports.

Somehow, between Q3 and Q4 2011, HTC managed to slash their R&D costs by 60% (?!).

Without announcing the massive layoffs.

Given that most of the expenses in R&D come from the salaries of people actually doing research and development, I always wondered – how the (F&^%k) heck did they do that?

Now, I think I know how.

There must have been some staff firings there. But most of the rest came by slashing overtime and (maybe) salaries from current R&D staff. Which were left to fill in and made to work harder and more in some sort of “survival program” to keep HTC going.

It may have worked some, or not – we’ll have to see what happens with M7, M4 and other 2013 HTC product launches.

But engineers who created those devices are already getting restless about doing much more, and getting paid less. According to Taiwanese media, a thousand or more of them recently sent and open letter to HTC CEO Peter Chou, complaining for:

HTC RandD

“… requiring more than a thousand engineers to work 12 hour days according to “responsibility system” without any overtime compensation, for more than a year… which means 1000+ hours of uncompensated overtime per person per year – is extremely unreasonable…”

Well, my Google Chinese was off somewhat.

In comments Liaw Kim Poh •says  it wasn’t 1000 guys, it was just 1 guy. But…. he asked … how the fff…. long would we have to work these 12hr shifts without overtime (talking about 5000 engineers who had to do that) :)

And, frankly, I’m not sure which is better. 1K guys speaking out, or 5K sending a representative…

HTC says it complied with all the Taiwan’s labor laws. And it’s cool. I also understand that when, suddenly, you go from meteoric growth to unexpected decline you have to make some sacrifices. And HTC’s approach – asking all of engineers to share the pain in transition, instead of sacking half of them right then, was a very smart and good thing to do.

My only problem is, that in this market, good smartphone engineers always have options. And, from what I’ve read, most of them (except those who leaked that memo), are still very loyal to HTC, just frustrated. Not shure how long that will last before they are ready to leave…

So, I hope HTC’s M7 is amazing. And it pulls M4, G2 and everything else you  have in store, along. Against Galaxy S IV and all Samsung’s marketing budgets.

Because if, with those thousand or more engineers who created Nexus One, HD2 and those other great HTC devices, you still can’t make something amazing after slaving for 30% of their time for no pay….

It’ll be your fault, Peter Chou and Cher Wang. If I’m still reading excuses and promises this time next year, HTC doesn’t deserve to survive. And your engineers will be much better off helping Huawei, Lenovo and Samsung to do their thing

Author: Stasys Bielinis

While I like to play with the latest gadgets, I am even more interested in broad technology trends. With mobile now taking over the world - following the latest technology news, looking for insights, sharing and discussing them with passionate audience - it's hard to imagine a better place for me to be. You can find me on Twitter as @UVStaska'

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  • Liaw Kim Poh

    the translation is bit off, but still not good on HTC though. The article actually says, engineer (didn’t say one or more, but definitely not a thousand…) wrote anonymous letter to the CEO, the sender think that it is not right to ask over 5 thousand of engineers to work 12 hours a day as their responsibility and without overtime pay …

  • Manbo

    Maybe… and I’m just spit-balling here… if HTC actually listened to what the customers want, they might not be in this much trouble.
    So quit being jerks, stop locking your phones down tighter than Fort Knox, and support the dev community.

    SMH @HTC

  • AndroidiMac

    The developer community is meaningless to the global smartphone market. Slow and inconsistent updates along with horrible battery life and until recently, miniscule storage space have been their biggest problems.

  • Xavier Spruill

    Release your wares on more than one US carrier at a time, and end exclusivity deals… HTC problems solved.

  • Manbo

    Very very true, but don’t forget about word of mouth advertising.

    As I can attest, the phones that I am able to work on, customize, enjoy and support past their EOL in the eyes of the manufacturers, I help support them and keep them running with updates and tweaks for people I know.

    My friends and family turn to me for all their Androids (and there a quite a few converts based on my suggestions) and now that HTC has thumbed their proverbial nose at the dev’s, they are bleeding out.

    If you factor in my immediate friends and family, 20 have Android devices based on feedback from me, only 2 have HTC’s. Multiply that by tens or hundreds of thousands of other users around the globe who dev or mod. It starts to paint a different picture.

    Personally I love the quality (usually) and design (mostly) of HTC and would they provide, as you said, larger batteries, storage, and updates, as well as properly unlocked bootloaders, s-off, etc., there would be a few more customers purchasing HTC devices.

    Companies have forgotten how powerful word of mouth advertising is, and I believe HTC is now feeling its wrath.

  • SuleimanChechen

    htc best of yhe best))