Taipei: HTC was once the standard bearer of the Android phone but that was 2010 – a long time ago in mobile terms. Now analysts say it faces another weak quarter and an uphill struggle to prove to investors it still retains its innovative touch.  

HTC Corp, the world's No.5 smartphone maker by shipments, is widely expected to roll out four models later this month at the Barcelona Mobile World Congress, including an ultra-slim type, currently codenamed the HTC Ville, and one that uses advanced quad-core chips.  

The challenge, analysts say, is to make such devices stand out in an increasingly competitive marketplace. 

"It can be turned around," says Melissa Chau, Singapore-based research manager for IDC. "But the problem remains the same: How are they going to differentiate?"  

The size of the problem is getting clearer. Before the Barcelona conference, analysts expect HTC to post an 11.6 percent decline in revenue this quarter compared with the last one, after a worse-than-expected decline in the fourth quarter, the first decline in two years.  

The company will announce first-quarter guidance at around 0800 GMT on Monday.  

"We think the company is likely to give muted 1Q shipment and sales guidance due to lacklustre demand for its old products, and as most of their new projects will be only kicked off in late 1Q," said BNP Paribas analyst Laura Chen in a report. 

She noted aggressive price cuts, lower economies of scale and likely inventory digestion as pressuring sales and margins this quarter. BNP expects HTC to resume sales momentum from late in the first quarter of 2012 and more than 30 percent sales growth in the first half of the year. But it won't stop year-on-year sales and earnings growth remaining in decline. 

HTC dropped to fifth place in the global league table in the fourth quarter, according to tech research company IHS, down one place from the previous quarter, as its models scrambled to compete with Apple Inc's iconic iPhone and Samsung Electronics' Galaxy range.   

The Taiwanese former contract maker had a fairytale ride in 2010 and early 2011, when its shares more than tripled in the 14 months to April 2011 and sales grew four-fold in 1-1/2 years as consumers snapped up its innovative phones with their distinctive large clock numerals.  

Back then, HTC was synonymous with the Android operating system: indeed, Google chose HTC to build its flagship Nexus One phone to showcase Android's features in early 2010.  

But an equally rapid fall from grace saw its stock become the worst performer among global smartphone companies last year, down 42 percent. Analysts questioned its lack of new designs in the fickle and fast-changing smartphone market. 

HTC has found it hard to differentiate itself as more players have entered the Android market, says IDC's Chau. The software, and increasingly the hardware, have become commoditised, forcing HTC to hunt for new ways to stand out.  

"They have been differentiating by their user interface, and that worked at the beginning," she said. "But do users now buy a phone based on that?" 

Meanwhile Samsung ambitiously created new segments from the high-end, with models such as its large-screen Galaxy Note, down to Android phones costing less than $200, as well as leveraging its marketing and retail networks to promote its products.  

HTC has ambitious plans for the year. It will announce four new smartphones at the Mobile World Congress on Feb. 26, according to Barclays Capital. The HTC Ville will feature a 4.3-inch AMOLED display and an 8-megapixel camera and run on the latest version of Android, 4.0.