After many speculations, LG confirmed on Monday (05) that it would leave the cell phone market. The news, revealed during an official statement, accompanied details about the brand’s next steps. Now, LG intends to strengthen itself in other fields, with a focus on artificial intelligence, electric car components, robotics items, smart home products – an industry in which, it is worth remembering, is already a leader.
In addition, the manufacturer will strengthen its “business to business” (or B2B) business – which, in other words, means that it will become a supplier of products to other companies.
Decision reflects general difficulty
LG’s internal change portrays difficulties that many other companies in the cell phone industry are already facing. In fact, this is not the first time that a prominent company has had a makeover due to obstacles in the mobile market. It is worth remembering BlackBerry and Nokia that, although they led the flip era, they failed to transition to touchscreen models. While the former is under the control of HMD, BlackBerry was sold by TCL.
Even Samsung and Apple, which have long established themselves in the market, face casualties. This is linked to numerous factors, such as the less frequent exchange of cell phones by consumers and the widespread demand for intermediate models.
The truth is that the average consumer wants a good cell phone, which lasts a long time, at the lowest possible price. While this is to his advantage, it is not for companies, which invest heavily in high-end models.
LG loses place in the top 5
In 2007, the year that the first iPhone was sold, LG was the fifth largest seller of cell phones, behind only Nokia, Motorola, Samsung and Sony Ericsson. All the top 5 companies, with the exception of Samsung, have lost competitiveness over the generations. In the last quarter of 2020, however, LG did not appear in the top 5. For comparison purposes, even Huawei, with all its commercial sanctions, was among the top 5.