LG Looking to Shut Down Smartphone Business After Failing to Find a Buyer

[MacRumors]

LG is looking to close down its entire smartphone division after failing to find a buyer for the ailing section of its business, according to the Korea Herald.

In January, LG announced that it was considering options for an exit from the smartphone industry, "including sale, withdrawal and downsizing." Though LG was once the world's third-largest smartphone maker and a sizeable competitor to Apple in the industry, the company's smartphone business has seen declining shipments and accrued losses of $4.5 billion over the past five years, leading to the need for an urgent re-evaluation of the division.

LG reportedly entered talks with Vietnam's Vingroup and automaker Volkswagen about purchasing the company's smartphone business, but negotiations did not lead to an agreement. Although the decision has yet to be confirmed, industry insiders report that LG is now likely to shut down its smartphone business instead of selling it. A source speaking to the Korea Herald explained:

LG reportedly had talks with others over the sale of the unit but apparently there was not much progress in their negotiations. It seems that selling its entire mobile business appears to be difficult at this moment, as is the partial sale of the unit.

With LG's internal restructuring plan now reaching its conclusion and no buyer having been found, the company is said to be leaning toward cutting its losses by closing the smartphone division fully.

LG's recently announced smartphone projects, such as "Rainbow" and "Rollable," are believed to have been scrapped, as the company looks to utilize its existing mobile workforce elsewhere in the business, such as the vehicle component solutions division.

LG is expected to publicize the decision about its smartphone business unit next month after a board meeting.

Article Link: LG Looking to Shut Down Smartphone Business After Failing to Find a Buyer

 

[SkippyThorson]

Wow. This is a bigger surprise than the slaying of Palm and Blackberry. Not to mention; can't find a buyer? No other manufacturer (Samsung) of smartphones saw fit to expand their lineup or just purchase the IP? That's something.

 

[JosephAW]

My LG flip phones were better than Apple’s flip phones.

 

[joecomo]

that hurts - liquidating that business is so much more painful than selling it off.
Good news for Samsung & others - market is still crowded so profits might not really
go up.
Probably irrelevant for Apple though ...

 

[locovaca]

LG took chances, they just all didn’t pan out. The G5’s modules never panned out. The dual screen implementations were ok but clunky. Combined that with the phones that truly did suck (G4, looking at you) and it doesn’t take much to lose momentum completely.

 

[mtneer]

This is terrible news. With many of the Chinese makers in the doghouse, this consolidation cannot be good for consumers.

 

[Flow39]

Sad to see them go, but I could see the writing on the wall for awhile. The last super solid contender they had was the LG G4. After that, they had some okay phones like the V20, but nothing that would make someone buy it over one of the competitors’ products in most cases. The G2 and G3 were great phones however, and I’m a bit disappointed they couldn’t have beaten out Samsung in the race since I felt they had a better overall hardware package for the price.

 

[swm]

looks like those flexible/foldable/rollable screen mockup videos did not age too well

 

[djcerla]

They should have switched to Android.

/s

 

[BootsWalking]

They went from boot loop to bankruptcy scoop.

 

[cmaier]

Wow. This is a bigger surprise than the slaying of Palm and Blackberry. Not to mention; can't find a buyer? No other manufacturer (Samsung) of smartphones saw fit to expand their lineup or just purchase the IP? That's something.

Maybe they wanted to sell the business and not the IP? Given the breadth of LG and the fact that they will continue to make components, etc., likely LG wants to hold onto the IP.

 

[I7guy]

This is terrible news. With many of the Chinese makers in the doghouse, this consolidation cannot be good for consumers.

It could mean an easier entry for a start-up to disrupt the industry. Not very likely, but within the realm of probability.

 

[RedTheReader]

Since LG will still be around and still own all the IP of their shut-down smartphone division, isn’t it possible that some competitor could come along years later and buy it from them then? Are we really sure that this is a “now or never” situation?

 

[H00513R]

Sad to see them go. My LG Lotus was one of my favorite devices. Maybe more so because it was a simpler time when texting was all I needed and the time-sucking iPhone had yet to be created. I liked the QUERTY keyboard on it as well.

 

[HerbertDerb]

Had LG V10 way back, it was ****.
Backlight bleed on the "second screen", the "second screen" was useless gimmick.

Boot loop-problem after 2 years, after the warranty has ended. 100% rubbish.

 

[sinsin07]

Instead of Death by 1000 cuts its Death by 1000 android, vendors.

 

[mikeyy00]

Good riddance.. their phones were nothing to write home about, and until recently they had some of the worst post-sales software support ever.

 

[mikeyy00]

It could mean an easier entry for a start-up to disrupt the industry. Not very likely, but within the realm of probability.

Doubt it. Apple and Samsung make all the profits. All these other chinese vendors fight over scraps. That won't ever change.

The current eco systems are far too mature for someone to come in and disrupt them.. even if Jesus Christ himself made a phone, no one would be interested in making apps for it at this point (see Windows Phone and Blackberry as a good example. Both OS's were outstanding IMO, and they never gained developer support/traction).

 

[mikeyy00]

Wow. This is a bigger surprise than the slaying of Palm and Blackberry. Not to mention; can't find a buyer? No other manufacturer (Samsung) of smartphones saw fit to expand their lineup or just purchase the IP? That's something.

Why? What "IP" does LG have over Samsung? There's almost no difference between the Android manufacturers these days. All are rocking some form of OLED screen, Snapdragon XXX, way too much RAM and 128-512 storage. That's part of the problem of being an Android vendor.. how do you make your phone stand above others? It aint your custom Android skin.. that's for sure.

 

[I7guy]

Doubt it. Apple and Samsung make all the profits. All these other chinese vendors fight over scraps. That won't ever change.

The current eco systems are far too mature for someone to come in and disrupt them.. even if Jesus Christ himself made a phone, no one would be interested in making apps for it at this point (see Windows Phone and Blackberry as a good example. Both OS's were outstanding IMO, and they never gained developer support/traction).

Slightly off-topic, but Blackberry had a good ecosystem, bad management decisions were made on hardware. As far as windows, if there was a phone that ran windows 10 and worked as well as windows 10 on my desktop, I would be all over it. But alas, that really never happened.

 

[JohnApples]

This is concerning as we March towards a duopoly of Apple and Samsung. Of course, we still have Huawei but I’m not sure that’s a good thing either if they continue to rise.

my first cellphone - ever - was an LG. Their flip phones were good, smartphones not so much I hear.

 

[mikeyy00]

This is terrible news. With many of the Chinese makers in the doghouse, this consolidation cannot be good for consumers.

If consumers were buying LG phones to begin with.. maybe this would matter. They weren't, that's why LG has been losing money on their phone business for what? A decade?

There isn't really such thing as "choice" in the phone space IMO, other than "Apple, or Android?".

 

[mikeyy00]

This is concerning as we March towards a duopoly of Apple and Samsung. Of course, we still have Huawei but I’m not sure that’s a good thing either if they continue to rise.

my first cellphone - ever - was an LG. Their flip phones were good, smartphones not so much I hear.

March towards? Man, we've been here for years already. Apple makes something stupid like ~66% of all worldwide mobile phone profits. Samsung is around ~20%. The remaining Android vendors fight over the ~14% that's left.

 

[souko]

Sad to see them go.

Even though I had LG G3 and it was on warranty claim for 3 months of six. After I sold it and bought iPhone 6.

 

[BlueCreek]

Would be interesting to know what VW would want with a smartphone business…