HTC's new flagship Android smartphone features a depth sensor to let owners change what appears in focus in photos after they are taken.
The HTC One (M8) also features a bigger screen and louder speakers than the previous model.
The company said the device should turn around recent weak earnings and help it recover market share.
But experts said Samsung and Apple's bigger marketing budgets would continue to put HTC at a disadvantage.
The Taiwanese company only shipped 6.4 million units of the original HTC One model last year, according to the research firm IDC.
That compares with 43.3 million shipped copies of Samsung's Galaxy S4 and 39.5 million shipped units of Apple's iPhone 5S, which also launched in 2013.
Across its portfolio as a whole, HTC actually sold fewer handsets in 2013 than 2012 despite growth in the wider market.
The new HTC One model features a bigger screen than its predecessor
"This is a make or break device for HTC," said Ben Wood, chief of research at tech consultancy CCS Insight.
"Although last year's HTC One was widely considered the best smartphone of 2013, the company failed to capitalise on this."
Photo effects
One of the new handset's distinguishing features is a sensor on its back used to record distance.
The information is used by an app to allow the owner to mimic the effect of changing focus after a photo is taken, keeping selected objects sharp but blurring others.
It also allows users to add stylised effects to a photo's background while keeping its main subject unaltered.
The depth sensor allows owners to create stylised effected that pick out people or objects
Another innovation is the ability to activate the phone without having to press its on-button. Swiping the screen in different ways takes the user to either what they were last doing, the home screen or a feed of news stories and social media updates.
The company also boasts that battery life is 40% better than before even though it has a bigger, 5in (12.7cm) screen.
However, it lacks a fingerprint scanner despite the firm's inclusion of the security feature on the One Max handset.
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