LG Looks to Android to Pass Samsung or Nokia By 2012

LG Electronics wants to be among the top two global handset providers by 2012, the company announced Jan. 13, as well as ship 140 million units in 2010. It plans to roll out more "cutting-edge" smartphone designs, many running Android, despite LG's earlier ties to Microsoft.

LG Electronics announced a few New Year's resolutions on Jan. 13, one of which was to sell 140 million units in 2010, representing a 20 percent year-over-year increase from 2009.

LG additionally announced that it is rolling out a multipart plan that will enable it to become one of the top two mobile device manufacturers in the world by 2012. A key part of this will be the introduction of 20 smartphones based on a variety of handset operating systems, including Google's Android, Microsoft's Windows Mobile and Linux.

LG said that in 2009, it opened approximately 100 mobile retail stores in developing countries and that it now plans to push into Korean and North American markets, where it wants to be known for innovative smartphones. In the first half of the year, LG will release smartphones for first-time buyers, followed by more "cutting edge" designs, presumably to better compete against the likes of Apple, Motorola, BlackBerry maker Research in Motion and Palm, in the second half.

"We are facing another revolutionary change in the mobile industry thanks to the rapid growth of smartphones and demand for more content and better services," said Skott Ahn, president and CEO of LG Electronics, in a statement. "We will continue to make breakthroughs in 2010 as we strive to maintain our trendsetter status and become one of the global top two by 2012."

In February 2009, LG agreed to make Windows Mobile the primary operating system for its smartphones, and at the Mobile World Congress in Barcelona, it wowed with the introduction of a very James Bond-like wristwatch phone, as well as other Windows Mobile handsets.

In September it announced that it had three Windows Mobile-based phones on the way, and in December it introduced the LG eXpo, an enterprise-geared smartphone with a 1GHz processor and a 3.2-inch touch screen, on the AT&T network.

LG didn't reveal how many of the 20 new smartphones will run Android, but Ahn told Reuters, "The fact that we'll have a bit more Android phones this year doesn't mean our ties with Microsoft are weakening. Windows Mobile has legacy issues that makes it challenging to compete in mobile: we know it, and Microsoft knows it."

The goal, according to Roger Kay, an analyst with Endpoint Technologies, is an ambitious one.

"The best bet for a company that doesn't have its own successful platform (i.e., RIM, Apple) is probably going to be Android, which comes with the backing of a solid brand name and access to a set of valuable services," Kay told eWEEK. "Still, LG has its work cut out for it."

Bonny Joy, a senior analyst with Strategy Analytics, says that LG is a credible player in the feature phone category, and that it benefited the most from troubles at Motorola and Sony Ericsson.

"However, in the smartphone space, especially in the Android platforms, LG will have to gain competitive strength in order to effectively differentiate from the likes of Motorola, HTC and now Google itself," Joy told eEWEEK. "They are a late comer to the party, and it is too early to say they are going to advance in the segment."

Carolina Milanesi, a research director with Gartner, believes these are still early days for Android. "LG might be getting into the game a bit later than HTC, and a little more quietly than Morotola, but it is certainly set to take advantage of the momentum we are seeing," she told eWEEK.

While Milanesi finds selling 140 million units a feasible goal for LG, she thinks becoming one of the top two is less likely. "It would imply that either Samsung or Nokia drop their position, and I do not see that happening," she told eWEEK.

In the third quarter of 2009, LG was number three in the handset market. Meeting its 2012 goal would mean besting either Samsung or market-leader Nokia. While Nokia has been faltering in past quarters, Samsung shipped 60.2 million handsets during the quarter, which was up 16 percent from a year earlier and, more importantly, said Strategy Analytics analyst Neil Mawston, gave Samsung 20.7 percent market share, boosting it past the "psychologically important" 20 percent mark.

LG also performed well during the third quarter, shipping an all-time high of 31.6 million handsets, which Mawston partly attributed to its unveiling of both Windows Mobile and Android-based handsets.

In the Jan. 13 announcement, LG also discussed its 3 Screen Service, which will also arrive in 2010 and enable users to view identical content on their handsets, PCs and televisions. In February it will launch a key component of this, a device that supports 3-Way Sync technology, which it said in the statement will "allow seamless viewing of all mobile, PC and Web content over a wireless network."