LG is considering rolling out of the smartphone market
Life ain’t that good for LG’s smartphone biz.
This year at virtual CES, LG once again teased its rollable, extend-o display smartphone. It’s easy to assume that this phone will never actually exist since CES is often full of concepts that never make it to market. Yet, the LG Wing exists, and I’m totally not bitter that LG never sent me one to review. But that swiveling monstrosity could be LG’s last new smartphone to reach the hands of consumers.
In a letter to internal employees, LG CEO Kwon Bong-seok noted that the smartphone marketplace is becoming too competitive to continue operating as-is, hinting at big changes. In a statement to The Korea Herald, LG stated: “Since the competition in the global market for mobile devices is getting fiercer, it is about time for LG to make a cold judgment and the best choice. The company is considering all possible measures, including sale, withdrawal and downsizing of the smartphone business.”
Nothing has been decided yet, but LG smartphones could be on the chopping block. Thankfully LG, as a technology company, has its hands in numerous electronics sectors, from vacuums to televisions. Losing its global smartphone business to the likes of Apple, Xiaomi, Huawei, Samsung, and Vivo almost seems like an inevitability at this point. While the LG Velvetshould have been a smartphone widely embraced by the public for its price relative to features, it was not well-reviewed. So it wasn’t.
While we might see the rollable phone this year, it won’t be enough to save the LG smartphone business, which has lost billions over the last five years. Again, these aren’t bad phones, they are just not able to compete with the other phones on the market that either tap into the luxury segment (Apple) or the affordability and better marketed to segment.
This also isn’t the first time we’ve seen a major manufacturer dip out of the smartphone market. Motorola was forced out, purchased by Lenovo, then after a few years of dormancy, had a slight resurgence with the new Motorola Razr. Nokia once provided 40% of the world’s cellular devices. When was the last time you held a Nokia phone? They still exist, in name only.
There is a lesson about diversification in here somewhere, as no matter the size of your business, tying it to one thing that could easily be outmoded by a company doing it better or cheaper is detrimental to your overall success. Regardless, LG, like Nokia, is a technology company first, so there is no doubt that it will continue to do what it does. In about five years we’ll see a resurgence of LG smartphones in branding only, with some call-back to the early 2020s.
The smartphone market, since the inception of the iPhone for sure, has been a public pool in the middle of summer, in the middle of the day. Not only is it full to the brim, but someone is constantly pissing in the pool and there is probably a floater.
The point is that this market is tough to really pull ahead in, unless you are Apple or your marketing and branding teams are good enough to not allow something like exploding batteries to destroy the brand. LG had its shot, created some innovative phones that didn’t quite hit the mark in the eyes of the consumer, and is now slowly slinking out of the pool, heading home to rinse off the urine and chlorine.
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