When it comes to smartphones, Apple, Samsung and HTC are in the lead. LG wants to but is not doing it yet. The mobile division of the electronics company came out with negative figures for the sixth consecutive quarter on the back of a model that is just not able to break the current balance of power on the smartphone market.
A given: There is little to do regarding smartphone specifications. LG’s Optimus series have displays that can compete with those of Apple and internal technology that keep pace with the devices of its compatriot Samsung.
But LG is still considered as trailing the competition, failing to impress the growing number of smartphone users who will now also be able to choose among a new range of smartphones from Nokia/Windows Phone.
Losses pile up
LG Mobile reported for Q3 2011 a loss of KRW 140 billion (USD 124 million), more than double compared with the previous quarter (a loss of KRW 55 billion). The number of handsets shipped fell to 21.1 million units in Q3 from 24.8 million units in Q2. In Q1, the number of handsets shipped was at 24.5 million units, a 10 percent year-on-year decline and a 20 percent decrease against the previous quarter.
LG expects to have its handset business back on track in the fourth quarter of this year. This would translate into results driven by the sale of mid to high-end devices. Smartphones that can work with LTE networks will in particular present an opportunity for the company, LG said.
Little space on the competitive market
The problem is that there is no niche for LG to jump into. The company’s main competitors shut the smartphone market off a few years ago with models that, even years after the initial introductions, can still rely on customer preference. If there was a niche available, the Optimus smartphones would not be the ones to fill it.
Despite the continuing poor performance of its mobile division, LG will have to quickly come up with one or more devices that will have a shot at competing with HTC, Samsung and Apple. This will take time and money, exactly what is lacking here.
LG can only hope that momentum slows for Apple's iPhone, which has already come out with different versions, and for the series of Samsung Galaxies, which have been on the market since 2009. Unfortunately for LG, Nokia –the mobile giant of old- is back and now spoiling for a fight for its share of the market.
