HTC is looking to make a splash in the low-end handset market with plans to develop their own branded processor similar to what Apple and Samsung currently offer in the high-end arena. The CPU will be developed by ST-Ericsson and is expected to ship in 2013, as reported by China Times.

The two companies have signed a memorandum of cooperation which Unwired Review believes could be a big step in a move to decrease dependence on Qualcomm. Qualcomm processors powered a large majority of HTC devices up until this year and in a recent earnings call, HTC CFO Winston Yung hinted that his company wanted a very good range of suppliers to choose from in the CPU department. Other vendors like Nvidia are already providing application processors like the Tegra 3 in non US versions of the One X handset.

HTC has traditionally focused only on the mainstream and high-end markets but lowered earnings in recent times are seemingly signaling a change. The entry-level handset market continues to grow and HTC won't be the only big-name player in that segment. Nokia has been producing feature phones for some time although increasing interest from other Chinese manufacturers is narrowing their stronghold.

HTC could bring a lot to the lower end if they stick to their recent philosophy of producing fewer handsets of higher quality rather than simply flooding the market with dozens of uninspiring designs. It's a recipe that has worked well for Apple and Google and there's no reason why HTC couldn't do the same with cheaper phones.