ZTE considers cancelling Project CSX 'Hawkeye' smartphone after poor response

ZTE continues to trip over its own proverbial feet by assuming that a crowd knows what it wants.

The crowdsourced, crowdfunded ZTE Hawkeye, which in just under three weeks has raised only $35,000, has come under fire for ostensibly thinking that its potential audience would be willing to concede to a mid-range spec sheet after lobbying for the device to be a pie-in-the-sky project from the get-go.

Despite the fact that two features — eye-tracking and an adhesive back — won out over the rest of the votes, ZTE's naivety in not anticipating the backlash exposes the company's biggest flaw when it comes to attempting to expand further into the U.S. market: it just doesn't compare to the rest of the world.

"We are already fourth in terms of market share [in North America]," said Jeff Yee, Vice President of Technology Partnerships and Planning for ZTE North America, in an interview with Android Central. "We sold 18 million devices, and many of those were by connecting directly with consumers."

"We've heard lots of negative things from consumers after receiving direct feedback. We honestly didn't foresee this happening."

In 2017, the company aims to continue that momentum, according to Yee, by "moving upmarket with flagships" that people truly care about. Project CSX, or Crowd Source X, is ZTE's first attempt to appeal democratically to an audience that, cumulatively, would have a final say in how a phone turns out.

But Project CSX, or Hawkeye in its finished form — another questionable crowdsourced decision — has been met with almost no response by a buying public that traditionally falls all over itself for such things. The Nextbit Robin, for instance, raised over $1.3 million back in late 2015 on the promise of a well-designed phone with a few gimmicks.

"The whole Hawkeye process was interactive — it was designed to be," said Yee. "We were committed to not just source the idea, but also the branding, material choices and colors. This information has been invaluable." ZTE subsequently issued an apology for minimizing the importance of what, in retrospect, was one of the device's most important decisions, the choice of SoC, offering to change the Snapdragon 625 to a Snapdragon 835 at the risk of delaying the phone's release date and significantly increasing its $199 price.

"We've heard lots of negative things from consumers after receiving direct feedback. We honestly didn't foresee this happening." The team behind CSX thought that it could create a single SKU (version of the phone) that would appeal to a worldwide audience. That's how they settled on a device running a light version of Android with a spec sheet that wouldn't have been out of place in the early months of 2016. But for a phone shipping in late 2017, even with a $199 price tag, those looking for a high-end device — one that had their actual input in the heart and soul of the finished product — were sure to be disappointed.

Yee says that ZTE is more than willing to change some of the fundamentals of the phone if it will lead to increased sales — the Kickstarter campaign of $500,000 has largely stalled at just under $40,000 — but he and his team are committed to bringing the phone to market in some form. "We would definitely make some changes in response to a majority vote. If everyone wanted a Snapdragon 835, we would definitely try to make that happen. If everyone wanted a removable battery, we'd try to make that happen."

ZTE has acknowledged that the Hawkeye Kickstarter campaign isn't working.

But Yee understands that there were mistakes made in the initial voting process that led to a diffusion in the actual decisions made. "The challenge with running some of these polls is that we get so much feedback, it doesn't allow us to do line-item voting. If we could restructure some of the polls from the beginning, we would have broken it down to more specifics: Do you want a Snapdragon 625 or 835. Do you want a fingerprint sensor on the front or the back? We'd also have been able to tell people, when voting, your decision will have this impact on price."

Yee also acknowledges that the Kickstarter campaign isn't working. "We're already rethinking our strategy around selling the device, and Kickstarter just wasn't the right place to sell this phone. We're reconsidering the platform on how it goes out." There's also the possibility that Hawkeye will be canceled entirely, and though Yee says ZTE is committed to bringing the two core tenets of the phone — eye-tracking and rear adhesion — to market, they may instead be integrated into a future Axon flagship.

"This whole process has been a learning experience for us and because it is an industry first, we've learned so much from the program. If we choose to do it again, we now know how to break it down and learn from our past — and learn from our mistakes."

Yee also says that the next time around, he would try to find a way to give royalties to those who submitted ideas. He says that some people remarked on how they refused to disclose their Project CSX proposals because ZTE has no mechanism for compensating individuals.

Before any decisions are made about the future of Project CSX, the company's current flagship, the Axon 7, is poised to get updated to Android 7.0 Nougat in early February. Yee says that Google has received the final Nougat build, which includes long-awaited Daydream support, and is going through the process of certifying the release for public use. That process should wrap up in the coming days, and users of the sold-unlocked device can look forward to an update in the next two weeks or so.

Good news for a company that hasn't been in the news much over the past few months, overshadowed by the release of the Huawei Mate 9 in the U.S. and Xiaomi's ultra-modern Mi Mix in China. But ZTE appears to have big plans for 2017, and even if Hawkeye never makes it to market in its currently-proposed form, there are plenty of good ideas left — both crowdsourced and otherwise.