LG was a popular smartphone brand back in 2015-16. But with the rise of brands like Xiaomi, Vivo, and Oppo, they somewhere disappeared. They tried their best to keep up with the growing smartphone market but failed. They planned to shut their smartphone operation after 23 consecutive quarters of loss. LG called a board meeting on 5 April 2021 where they decided to shut down the smartphone business. LG decided to quit the smartphone market and shut its operations by 31 May.
LG quitting smartphone market, never coming back
LG said that “We want to focus on electric vehicle components, connected devices, smart homes, robotics, artificial intelligence, and business-to-business solutions.” It was more of an excuse, as end-user completely ignore LG, despite trying their best.
The main reason for the failure of LG’s smartphone business is less innovation. They were following the classic path, where other companies were experimenting and innovating their products. Like Samsung introduced foldable smartphones. At first, they failed but later on fixed the mistake and bought a new kind of innovation in the device. Other companies also decided to adopt Samsung’s concept of foldable smartphones.
LG’s smartphone business has been operating on loss every quarter since 2015 up to now. LG’s accumulating loss is about 5 trillion won(Korean currency). They are now planning to sell their smartphone unit to Vingroup of Vietnam and Volkswagen of Germany. However, Volkswagen is also interested in buying the patents and researchers.
LG’s current staff at the smartphone business unit will be shifted to other business units or sister companies. However, LG decided to continue their research in smartphone-related technologies such as 6G, cameras, and software.
If we take a close look at finances, LG’s loss in the smartphone market benefitted Samsung. LG’s loss will impact the whole smartphone industry. We may haven’t seen much growth in their smartphone business. But they catered to us with the smartphone features that were the need of time.
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