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LG mobile exit is a warning to all – if you fall behind, there’s no way back

LG is officially getting out of the smartphone business following months of speculation over its future involvement. The demise has been years in the making, argues Chris Smith.

If you fall behind the pack in the smartphone industry, it’s a very long way back. And you’ll probably not make it. That’s the key takeaway from today’s announcement that LG is quitting mobile phones.

Recent history is littered with big name manufacturers who once ruled the mobile roost, only to be surpassed and never find a way back to prominence.

The likes of HTC, Palm, BlackBerry all led the way at one point, but either failed to innovate, lost touch with what consumers were seeking, or took a wrong turn down a blind avenue to irrelevance.

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Years of design inertia from Sony’s Xperia range continues to keep it on the periphery, while only the licensing of its name by a new company keeps Nokia relevant after the wilderness of the Microsoft years.

These companies all have one thing in common; they once made handsets that were the envy of the mobile world, only to rest on those laurels and be outflanked by newcomers with a better idea of what consumers wanted from their mobile devices.

For instance, Apple, Samsung and LG supplanted Nokia, Palm and Blackberry at the dawn of the touchscreen era. OnePlus, Huawei, Xiaomi and Oppo have since capitalised on smartphone missteps from HTC, LG, Sony, and more, thanks to more innovative features and more competitive price points.

It can happen very rapidly too. All it takes is one or two disappointing flagships phones to drop out of the public consciousness when mobile users are considering an upgrade. Another company takes their place and from there its doubly hard to win back consumers. LG blamed that competition for its decision to exit the sector.

Mobile money pit

“LG’s strategic decision to exit the incredibly competitive mobile phone sector will enable the company to focus resources in growth areas such as electric vehicle components, connected devices, smart homes, robotics, artificial intelligence and business-to-business solutions, as well as platforms and services,” the company said in a statement.

Roughly translated, that means LG is done with losing money on phones and will instead pile that cash into winning the future. You can’t blame the firm at all. It knows the writing is on the wall and the comeback trail is a thankless errand in this climate.

LG can cite increased competition, but the facts are the company did very little to step-up to the threat. The G-Series phones hit their stride in the middle of the last decade, but quickly fell off a cliff. By the time the bitterly disappointing LG G8 arrived in 2019, the company looked a spent force.

Diminishing returns

The same law of diminishing returns applied to the initially promising V-Series. When the expensive V40 ThinQ dropped in 2018, it just couldn’t stack up with those manufacturers charging far less money for better phones. Things got better with the improved LG V60 and LG Velvet in 2020, but by that point it was too late.

Most people had moved on and LG knew it. So the company did what other struggling companies have done and overreached with “wow factor” phones to distinguish itself again. As recently as January 2020, LG was promising to return to mobile profitability by 2021.

Those resulting phones were less ‘wow’ and more ‘WTF’. The dual-screen, swivelling LG Wing had too few use cases to justify the form factor and, from there, the writing seemed on the wall.

Our reviewer concluded: “The LG Wing has made a few too many compromises, with too few corresponding advantages, and for too much money to be worth a gamble over the very best flagships.”

That’s been the story of the last few years for LG, where it has badly struggled to break par when it comes to flagship phones.

The irony is, the most excited we’ve been about an LG phone in years, was the rollable prototype it revealed at CES 2021. It seemed to solve many of the problems with hinges we’ve seen in the foldable sector, while giving users a larger display when required.

Unless LG has another change of heart, we’ll never know whether the LG Rollable could have been a viable alternative to the Galaxy Z Fold or Moto Razr series, or whether the price would have been too high and tech not all it was cracked up to be.

Perhaps it’s best that we don’t know. Now we can always wonder what might have been; whether LG could have risen from the ashes in the mobile industry. The truth is, the odds were always massively against it. LG phones had fallen too far.

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