LG Electronics, a South Korean multinational company, has announced to pack up its mobile business unit after nearly six years of losses totaling $4.5 billion. LG Mobile Business has maintained 3rd position within the manufacturing of smartphones for a real while.
The company has been finding it hard to take care of its financial position and to extend the sales of mobile phones amid the competitors. The move makes it the primary major smartphone brand to withdraw from the market.
WHY LG PLANS TO PACK UP
The company has been struggling to compete with global competitors like Apple, Samsung, One Plus, and Xiaomi dominate the mobile market. Apple and Samsung are the sole brands that have maintained their sales over the years during this market.
Even the legacy phone brands like Nokia and Blackberry have faced tons of struggle and have lost their market domination. LG did not keep their products with the competitors and therefore the new players are providing smartphones with better software and Operating systems at an inexpensive price.
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FUTURE OF LG MOBILE BUSINESS
LG is planning to focus more on smart home products from smartphones. LG is one of the most important providers of smart home products globally. The company is further getting to consider electric vehicle components, AI, robotics, business-to-business products, and other connected devices.
The company has plans to retain the core technologies that they had developed during the 2 decades of their mobile manufacturer. The corporate is getting ready to apply it to its existing and future products.
SERVICES TO EXISTING CUSTOMERS
For existing mobile customers, LG will provide service support and software updates for a period of your time, varying by region. On the request towards the company’s US business on how long will LG provide services to US customers didn’t receive any reply.
A representative of AT&T has said that they’re conscious of LG mobile business shutting down and added on saying that they might still support the people that use LG devices on their network as LG
makes this move.
This step is taken by AT&T as a commitment towards their customers. The company noted that details associated with the worker are going to be determined at the local level.
BENEFITS TO COMPETITORS
In 2007, LG was the fifth biggest smartphone maker globally. This was when the primary iPhone was launched and went into the sale. within the fourth quarter of 2020, LG couldn’t get ranked within the list of top whereas Huawei which is struggling due to certain US sanctions has managed to be within the fifth
LG Mobile Business exit would present a chance to Apple and Samsung to realize more customers, especially within the US where LG’s market share was 9% as of December 2020, consistent with Counterpoint Research.