For those who follow the space, LG will be remembered fondly as a smartphone trailblazer. For a decade-and-a-half, the company was a major player in the Android category and a driving force behind a number of innovations that have since become standard.
Perhaps the most notable story is that of the LG Prada. Announced a month before the first iPhone, the device helped pioneer the touchscreen form factor that has come to define virtually every smartphone since. At the time, the company openly accused Apple of ripping off its design, noting, “We consider that Apple copycat Prada phone after the design was unveiled when it was presented in the iF Design Award and won the prize in September 2006.”
LG has continued pushing envelopes — albeit to mixed effect. In the end, however, the company just couldn’t keep up. This week, the South Korean electronics giant announced it will be getting out of the “incredibly competitive” category, choosing instead to focus on its myriad other departments.
The news comes as little surprise following months of rumors that the company was actively looking for a buyer for the smartphone unit. In the end, it seems, none were forthcoming. This July, the company will stop selling phones beyond what remains of its existing inventory.
The smartphone category is, indeed, a competitive one. And frankly, LG’s numbers have pretty consistently fallen into the “Others” category of global smartphone market share figures ruled by names like Samsung, Apple, Huawei and Xiaomi. The other names clustered beneath the top five have been, more often than not, other Chinese manufacturers like Vivo.
Between the big names in the premium category and companies that can offer solid devices at low price points, there seemingly wasn’t a lot of space left for an LG. The brand ultimately just faded away. It’s not for lack of trying, of course. LG continued to focus on imagining and exploring unusual form factors like the oft-cited Wing, which features a second, flip-out screen.
LG’s status over the last several years will draw inevitable comparisons to the likes of HTC, which has similarly languished in the smartphone category. HTC has been the focus of its own rumors amid shrinking team sizes. In 2018, the Taiwanese company sold a large chunk of its smartphone division to Google for $1.1 billion. That deal informed the development of the next couple of Pixel devices, while HTC continued to hobble along.
It’s worth noting, of course, that big names in this business don’t always stay dead forever. BlackBerry and Nokia have both had comebacks in the form of IP licensing (multiple, in BlackBerry’s case). Even the Palm brand has seen a resurgence. Of course, those brands are strong enough to capitalize on a sense of nostalgia that LG just may not possess. Sure, people have fondness for certain devices, but outside of, perhaps, Korea, can a strong argument be made for widespread brand loyalty?
It would be easy to blame this death on COVID-19. The pandemic may well have been the final nail in the LG handset coffin, but the writing has been on the wall for years now. Samsung ate the company’s lunch on the high end years ago. Huawei has made a compelling case as well (even if sanctions put the company’s overall health in jeopardy). And the lower end is ruled by various other Chinese handset makers.
All this while the overall category was contracting well before the arrival of the pandemic. Of course, widespread unemployment and thousands of people stuck at home only cemented the slide. Those factors dulled an anticipated rebound from 5G technologies — the first two quarters of 2020 saw a 20% drop, and the rebound we did see at the end of the year mostly worked in Apple’s favor as the company finally shipped a 5G handset.
It was time for LG to move on from the sector. Frankly, the only surprise was that it didn’t do so sooner — though that seemingly is the result of not finding any enthusiastic buyers. Given how underwhelming the $1.1 billion HTC purchase eventually was for Google, it’s probably easy to see why.
LG is already talking 6G in its future plans. Things have begun to rebound after a dismal pandemic-fueled drop off, but overall, it’s hard to get super excited about the category. That goes double for a once mighty pioneer that spent many years languishing in the middle of the pack.
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