HTC is in a bad way. After sales of its HTC One smartphone failed to compete with iPhone and Galaxy S4 sales, the company released dismal financial results for its latest quarters. As rumors of a buyout begin to circle the company, even Beats Electronics is trying to buy a portion of itself back from the struggling manufacturer. It remains to be seen whether an ambitious and strange marketing campaign starring Robert Downey, Jr. will be able to help HTC compete in the high-end smartphone segment.

Now, rumors have surfaced that HTC is attempting to break away from Android and offer a competitor to the current smartphone operating system duopoly – at least in China. The Wall Street Journal today reported that HTC is developing a mobile OS. The report cites unnamed “people familiar with the project” as saying the software is being specifically developed for the Chinese smartphone market.

HTC has reportedly been consulting with the Chinese government on the project. The new OS is rumored by the Journal to be heavily integrated with popular chinese apps such as Weibo.

The project could signal a shift in strategy at HTC, which has lost a large amount of Android smartphone global market share over the past two years. A strategy focusing on China is in line with analyst predictions that the low- and mid-priced smartphone markets will be the major growth sectors for the smartphone industry in the coming years, particularly in countries such as Brazil, India, and China.

(via The Wall Street Journal)

(Image courtesy HTC)