As LG Electronics announced that it will end production and sales of mobile phones on July 31, a major change is expected in the domestic and overseas smartphone market.
LG Electronics occupies ninth place with 2% of the global smartphone market. In terms of its share in the global smartphone market, it is insignificant, but in Korea, 1 in 10 people use LG smartphones, and in the North American market, it is not small as it occupies the third place with a 10% share after Apple and Samsung.
However, according to LG Electronics’ decision to withdraw its business, the domestic market is expected to rapidly shift to Samsung Electronics and Apple Yanggang. In the overseas market, Chinese affiliates such as Huawei, Xiaomi, and Motorola (Lenovo), starting with Samsung Electronics’ low-end smartphones, are expected to occupy vacant positions for LG Electronics.
■’Third option’ disappears in the domestic smartphone market
In the domestic smartphone market, LG Electronics does not have a high share, but it is the third largest market share after Samsung Electronics and Apple.
According to counterpoint research, a market research firm, LG Electronics maintained the third place in the domestic smartphone market last year with a 13% market share. About 7 out of 10 people use Samsung phones, 2 people use iPhones, and 1 people use LG phones.
However, as LG Electronics decided to withdraw its smartphone business, domestic consumers have to choose between Samsung Electronics’ Galaxy or Apple iPhone.
■ Samsung Electronics in North America and Motorola and Xiaomi in Central and South America are likely to take the market.
According to Counterpoint Research, LG Electronics ranks third in the North American market after Apple and Samsung Electronics. Its share is about 10%. In the Latin American market, it ranks fourth with a 4% share similar to that of Apple, following Samsung Electronics, Motorola, and Xiaomi.
Counterpoint Research predicts that after the withdrawal of LG Electronics’ smartphone business, Samsung Electronics will share the market share in the North American market, and Samsung Electronics, as well as Motorola and Xiaomi in the Latin American market.
“The global sales of LG smartphones account for more than 80% in the North and South American market,” said Lim Soo-jung, a researcher at Counterpoint Research. It is expected that it will be able to take some share based on a broad product portfolio at mid- to low-end prices. In addition, in the South American market, Chinese brands such as Xiaomi and Oppo are also expected to gain a return.”
■ Domestic and overseas smartphone manufacturers successively withdrawal and business termination
Currently, it is difficult to find smartphones made by domestic and foreign manufacturers other than Samsung Electronics and Apple in the domestic market.
Pantech withdrew from the domestic market for the last time with’Vega Iron 2’in 2014. After taking over Pantech in 2015, Solided, a mid-sized communication equipment company, launched’I’m Baek’ in 2016, but failed to revive the smartphone business.
Foreign smartphones also did not use great strength in the domestic market. Blackberry smartphones with an email push function completely withdrew from the domestic market in 2013. Sony also stopped supplying Xperia smartphones to the domestic market from 2019.
■ Mobile industry “Korean LG phone users, go to Samsung Electronics”
The mobile telecommunications industry expects that LG Electronics’ withdrawal of smartphones will not bring significant changes to the market. This is because the market share was not high.
An official from a telecommunications company diagnosed, “It is expected that existing domestic LG smartphone users will move to Samsung Electronics smartphones equipped with Android operating system (OS) rather than Apple iPhones equipped with iOS.”
“It is expected that domestic consumers will choose Samsung Electronics smartphones, which have a diverse portfolio ranging from flagships to mid-priced products, rather than using Chinese products with low brand trust.”
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