The Taiwanese company is reportedly working with the government of China to build a mobile OS that has deep integration of Chinese services and social networks like weibo. This OS will be target the Chinese market and could launch before the end of next year as sources at Wall Street Journal state.

However it hasn’t clearly been stated where the OS will based upon an open source android fork or will be built from scratch.  However its most likely the OS might be custom because china has had issues with Google and most android phones made for china either don’t have Google play or have it blocked.  HTC already has some devices using the OS in active testing and prototypes are in the hands of the Chinese government officials.

You might say that HTC’s idea of building an OS for “a third” of the world’s population is a smart idea however they aren’t the only players, because some companies such as canonical have partnered with china to build a China specification version of its Ubuntu.

HTC’s new OS will favor china based apps and services because the government of China has been actively trying to reduce reliance on foreign made software and its technology ministry early on released a “white paper” that criticized China’s over reliance on Google-made Android OS.

This OS might not be the biggest threat to Google’s android or iOS but it will definitely eat up a share of their market. However this is a smart move by HTC because integrating a long term partnership with the government of China will see HTC’s profits probably grow.