LG says it might quit the smartphone market

As traditional, issues are usually not trying good for LG’s telephone division. As reported by The Korea Herald, LG Electronics CEO Kwon Bong-Seok despatched out a staff-wide memo that the corporate was contemplating making main adjustments to its smartphone division, together with probably quitting the smartphone enterprise.

Final week, Korean information outlet TheElec additionally wrote about this memo in a now-deleted publish. The publish was deleted as a result of LG brutally debunked the report, calling it “fully false and with out advantage.” This week, LG is confirming mainly the identical memo report from the Korea Herald, full with feedback from LG. The Verge additionally acquired a thumbs-up from LG concerning the report.

“Because the competitors within the international marketplace for cellular gadgets is getting fiercer, it’s about time for LG to make a chilly judgment and your best option,” an LG official instructed the Korea Herald. “The corporate is contemplating all attainable measures, together with sale, withdrawal, and downsizing of the smartphone enterprise.”

LG’s smartphone enterprise has been struggling for some time. Because the report factors out, LG’s smartphone division misplaced about 5 trillion gained ($4.5 billion) over the previous 5 years. The official earnings rely has the division at 22 consecutive money-losing quarters. At present you will not discover LG on a “Global smartphone market share” chart; as an alternative, will probably be buried down within the “different” class. Within the US, Counterpoint has LG at 13 p.c of the market, due principally to pre-paid gross sales.

LG Electronics’ CEO solely landed the place 13 months in the past and has undoubtedly been evaluating LG’s solely money-losing division over the previous yr. In an interview in January 2020, shortly after being appointed CEO, Kwon promised “LG Electronics’ cellular enterprise goes to be worthwhile by 2021.” It is nonetheless not clear if that is thought of an inexpensive objective for the corporate.

TheElec’s unique scoop is backed up and translated here. You need to positively take it with a grain of salt because the outlet deleted the publish and is not standing behind it, however to date, it appears to be appropriate. It comprises an attention-grabbing tidbit that is not within the different report: that LG will announce a course for its cellular unit on January 26. TheElec additionally claimed that LG despatched out a directive to “cease all developments aside from the i challenge,” with “i challenge” being a code identify for LG’s flexible-display LG Rollable smartphone. The final little bit of the report sounds very believable in elevating the chance that the LG model won’t ever really go away the smartphone market and can as an alternative farm out the emblem to varied white-label ODM companies.

Why would anybody purchase an LG telephone?

LG has by no means had a strong gross sales pitch for the smartphone wars. On the excessive finish of the market, LG has at all times appeared to be overshadowed by its larger Korean rival, Samsung. It shipped high-spec telephones with heavy Android skins and a foul replace plan, and when Samsung provides the identical factor with larger model recognition, why would anybody choose LG? On the low finish of the market, particularly within the US, the corporate has reliably shoveled low cost, nameless telephones into provider shops and the pre-paid market. That is one thing that must be achieved, however once more, there’s nothing right here that may make LG stand out from the group.

If something, LG has a fairly dangerous popularity in relation to constructing smartphones. The corporate’s telephones are recognized for dying early and going into “boot looping,” an unusable Android failure state the place the telephone reboots repeatedly resulting from dangerous flash reminiscence. LG was sued over boot loops in 2017, with the lawsuit naming each high-profile LG machine launched in 2015 and 2016. LG ended up settling. I do know I’ve personally laid 4 LG-made Google Nexus 5Xs to relaxation over boot loop points.

When the corporate wasn’t occupying the identical lane as Samsung, it was trotting out ridiculous gimmicks that may be forgotten a yr or two later: there was the LG G5 with its modular equipment, like a clip-on camera grip; the inexplicably banana-shaped LG G Flex; and an obsession with numerous “twin display screen” designs just like the LG V10’s notification display, the LG V50’s clip-on second screen, and the LG Wing’s “T” shaped design. You possibly can see the corporate attempting to do one thing completely different to face out, however none of those concepts was good, or at the very least they weren’t successful with shoppers.

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