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When you buy a cell phone Nokia or one Blackberry You are not buying a Nokia cell phone or a Blackberry cell phone. You are buying a cell phone from a third party that has licensed the name and brand to put it on devices that would otherwise have a name few know: HMD or TCL, in those 2 cases.
The same will soon happen with LG cell phones.
After 22 quarters of continuous losses – since the first half of 2015, LG’s cell phone division has not made a single profit – the company announced on Monday a reorganization of its cell phone division.
And he’s done it around something he’s called Original Design Manufacture (ODM), which is nothing more than a fancy way of announcing that it will take the same path as Nokia and Blackberry and will phase out its low-end and mid-range devices, opting instead to “brand” devices created by a third Chinese (although who it will be has not been specified).
Additionally, he has eliminated several positions associated with the Development, Research and Production of mobile devices in house, focusing its efforts only on the premium line, which includes the LG Wing and of which we hope to see a new “roll-up” model next year.
The idea with this reorganization is to be able to lower the costs of the bulk of its devices and compete with Chinese manufacturers at the price point, hoping that the ODMs will produce models that attract an audience that seems to have completely forgotten the brand.
And it is that despite the fact that at the beginning of the last decade LG competed face to face with Samsung and Apple for the Top 3 in the smartphone market, today it does not appear in the Top 10 after having lost market with the Chinese giants Huawei , Xiaomi, Oppo and Vivo that have taken over their natural market.
Will LG survive? Insurance! its other lines of business have maintained a decent pace, despite the pandemic. Will it shine again in the smartphone segment? It’s hard. Bets like the LG Wing seek, at least, to try different form factors to try to find a clearly different niche. And if the “rollable” ends up offering a better experience than that of the bendable ones of Samsung, Huawei and other Chinese manufacturers, it is possible that LG will return to the leadership position that for years it held in this market.
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