LG is stepping out of the smartphone business, the company confirmed today. The decision “will allow the company to focus resources on areas of growth, such as electric vehicle components, connected devices, smart homes, robotics, artificial intelligence and business-to-business solutions, as well as platforms and services,” said LG in a statement. communicated.
Existing phones will continue to be sold and LG says it will continue to support its products “for a period of time that varies by region”. The company said nothing about possible layoffs, except that “the details related to employment will be determined at the local level”. LG says it expects to complete the deal by the end of July this year.
The move has been rumored for several months after the division’s huge losses over the past five years. Once considered a rival to fellow South Korean manufacturer Samsung, LG’s recent high-end smartphones have struggled to compete, while its cheaper handsets face stiff competition from Chinese rivals. The company had previously said it hoped to make its smartphone division profitable by 2021.
Today’s news means that the long-vaunted LG roll-up phone is unlikely to see the light of day. The last time the company exhibited the device was at this year’s virtual CES, when the company insisted that the device was real and would be launched later this year.
Reports that LG is considering leaving smartphones have been around since at least the beginning of this year. Although a company spokesman classified an earlier report on the company’s possible exit from the smartphone market “completely untrue and without merit”, an LG employee later confirmed to the The Korea Herald that the the company had to make a “cold judgment” about the division. Potential measures may include “selling, withdrawing and downsizing the smartphone business,” said the official at the time.
In March, reports emerged that the company had tried to find a buyer for its smartphone business, but negotiations stopped and it could close the division. Korean Outlet DongA said the company has halted the development of its next phones with mobile screens and that it has archived its smartphones planned for the first half of this year.
By losing share to rivals, LG launched a series of attractive devices with unusual shapes. There was the LG Wing, whose main screen rotated to reveal a smaller secondary screen below it, or its recent dual-screen devices. LG also experimented with a modular smartphone with the LG G5, only to abandon the initiative a year later.
Unfortunately for LG, none of these features were useful enough to turn phones into popular successes, and in the meantime, the company’s more traditional handsets have lagged behind rivals in key areas like camera performance.
LG joins a long list of high-end device manufacturers who have given up on smartphones over the years, although many of the brands have remained on devices made by third-party manufacturers. Nokia’s consumer-oriented brand lives on top of devices made by HMD, while the Blackberry brand was initially used by TCL and is expected to return this year on a device made by OnwardMobility. There’s also HTC, which still sells some weird devices, but sold most of its IP to Google in 2017. Who’s next?