 |
| LG is leaving the smartphone market |
The South Korean company LG plans to end its loss-making business after finding a buyer. This makes it the first major smartphone brand to leave the market entirely.
The company decided to withdraw its 10% share in the North American market, with the brand taking third place and joining Samsung and Apple. Local competitors are expected to gain an advantage.
LG is targeting mid-range models in the US, which means Samsung, which has more mid-range devices than Apple, will be more able to attract LG users.
LG's smartphone division has suffered losses for six years, with a total loss of around $ 4.5 billion.
"The divestment will allow LG to focus on growth areas such as electric car parts, connected devices and smart homes," the company said in a statement.
LG took the lead in this early market with many innovations in mobile phones, including ultra-wide angle cameras, and in 2013 it was the third largest smartphone maker in the world after Samsung and Apple.
However, the flagship model had software and hardware issues that came with slow updates and led to the demise of the brand.
Analysts have also criticized the company's lack of marketing experience compared to its Chinese competitors.
Other well-known smartphone brands (like Nokia, HTC, and BlackBerry) have declined but not completely gone.
LG's current global share is only 2%, and 23 million devices were shipped last year, compared to 256 million Samsung phones.
In addition to North America, the company has a large number of offices in Latin America and ranks 5th among brands.
The company's smartphone division is the smallest of the five divisions and is expected to be completed on July 31.
In South Korea, division employees are transferred to other subsidiaries, while hiring decisions are made elsewhere in the region.
The company plans to acquire patents on basic 4G and 5G technologies, as well as research and development personnel, and will continue to develop communication technology in 6G networks.
LG will provide customers with existing mobile product support services and software updates for a period of time, with the exact period varying by region.