South Korean electronics giant LG on Monday became the latest legacy phone-maker to exit “the incredibly competitive mobile phone sector” as it struggles in a market dominated by Apple, Samsung and growing Chinese manufacturers.
In a statement released on Monday, the company said it will close its mobile business unit by the end of July. Instead of smartphones, it will focus on smart home products — an area where it’s one of the biggest providers.
The statement reads, “LG’s strategic decision to exit the incredibly competitive mobile phone sector will enable the company to focus resources in growth areas such as electric vehicle components, connected devices, smart homes, robotics, artificial intelligence and business-to-business solutions, as well as platforms and services.
“LG will provide service support and software updates for customers of existing mobile products for a period of time which will vary by region. LG will work collaboratively with suppliers and business partners throughout the closure of the mobile phone business. Details related to employment will be determined at the local level.”
LG’s decision to wind down its phone business reflects the struggles faced by many companies in the market. Apple and Samsung have long been the only companies that make significant amounts of money from smartphones, and even they have struggled at times.
Other legacy phone brands such as BlackBerry and Nokia have faced their own struggles, and neither company now exists in its original form. HMD sells phones under Nokia branding, while TCL sold BlackBerry-branded phones before ending that partnership last year.
Nokia and BlackBerry, the leaders in the QWERTY phone world, failed to transition quickly to touchscreen smartphones, which doomed their chances in the mobile market. LG, too, struggled in the move to smartphones. While consumers and reviewers have generally liked its devices, LG didn’t have near the marketing might of Samsung or the cult following of Apple.
A spokesman for AT&T said in a statement that the wireless provider is “aware of LG’s decision to exit the mobile business,” adding that “as a commitment to our customers, we’ll continue to support those using LG devices on our network as LG makes this transition.”
