LG becomes the first smartphone brand to completely withdraw from the market.
LG is a South Korean Electonic company that is set to become the first smartphone brand to completely withdraw from the market.
The company is set to wind down its mobile division by the date set at 31st July. The firm, which controls 2% of the global smartphone market share announced on Monday 5th its decision to wind down its loss-making mobile division.
By pulling out of the market, LG will leave its 10 % share in North America where it occupies the number three brand behind smartphones titans of Apple Inc as well as Samsung Electronics.
The division has recorded nearly 6 years of losses accumulating to around
$4.5 billion. This dropping out will allow the South Korean company to focus on their other growing areas including electric vehicle components, connected devices as well as smart homes.
In 2013, LG was the third-largest smartphone manufactures in the world, coming just after Samsung and Apple. It boasts some cell phone innovations among which include ultra-wide-angle cameras.
The company has in the recent past come under intense criticism of lack of marketing expertise to keep up at pace with their Chinese counterparts. Its flagship models had mishaps in both software and hardware, with lots of issues regarding their slow software updates which saw the brand slip in favor of other competing brands in the market.
According to Counterpart, a research provider, LG currently has a 2% of the global share. Last year, it shipped 23 million phones in comparison with 256 million shipped by Samsung.
LG company has a sizeable presence in Latin America with its presr=ence ranking it up to number 5 of the most popular brands.
Park Sung-soon, who is an analyst at Cape Investment & Securities believes that Chinese companies such as Samsung, Vivo, Xiaomi, and Oppo are likely to benefit in both low to mid-end segments by LG withdrawal.
LG however will continue to software updates and service support to its customers for some period which will vary depending on regions. There were reportedly talks to sell part of their business to Vietnam’s Vingroup but the talk did not materialize due to differences.