[기자수첩]It’s not just LG’s crisis in the turbulent smartphone business

[이데일리 장영은 기자] The smartphone market is terrible. It may seem that there is no big change in that Samsung Electronics and Apple are in the first and second place, but if you look at the side, it is deserved to be a turbulent period.

LG Electronics decided to close the smartphone business after 26 years, and Huawei is maintaining its status only due to strong US sanctions. Samsung Electronics’ market share has fallen below 20% in 10 years, and Xiaomi has risen to the world’s third largest smartphone maker. All of this happened in just over a year.

With the recent situation, voices say that the transition from feature phones to smartphones took place in the late 2000s and early 2010s. This is the time when Apple launched its first smartphone,’iPhone,’ in 2007, and then Samsung Electronics followed suit, introducing’Omnia’ and’Galaxy’ to enter the smartphone business in earnest.

Smartphones are now a necessity and feel like a part of the body. LG Electronics also failed to respond properly during this period and eventually fell behind in the smartphone market.

Although several reasons are cited as the cause of LG Electronics’ smartphone business failure, the biggest hit is that the success of the feature phone has led to the inability to read the market trend and consumer demand. Maybe they were proud that they were leading the flow. The impact of LG phones leaving less than 2% of the global market share on the entire market may not be significant, but the message thrown into the market is clear.

It is a period of upheaval again. The market situation is fiercer than ever due to intensifying price competition from Chinese manufacturers and increasing players. Users have begun to scrutinize the’cost-performance ratio’ (price-performance ratio), and smartphones are becoming a device that acts as a hub of the digital world.

Previously, the device itself competed for its performance, but now usability and ecosystem are emerging as important topics. It is also the commonality between Apple and Xiaomi, which are showing an upward trend recently. Samsung Electronics is also strengthening its mid- to low-end product lines and expanding collaboration with software (SW) companies. Companies that are responsive to market changes and consumer demand will be able to lead the next decade.

[이데일리 노진환 기자]On the 5th, LG Electronics finally decided to end its mobile business, which has been in the red for 23 consecutive quarters.