Telecom & Wireless
LG: An Unlikely Rival Stalks Nokia (NOK), Motorola (MOT), And Apple (AAPL)
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Most investors would assume that the only handset companies to post increases in unit sales last quarter are Apple (AAPL) and RIM (RIMM). Those two high-end handset companies are damaging the market share opportunities of Sony Ericsson, Nokia (NOK), Samsung, and Motorola (MOT), especially at the top of the market–the smartphone segment.
The real threat to all of these companies has turned out to be LG Electronics. In the second quarter, its shipments of handsets were up 8% to almost 30 million, a record for the South Korean firm.
LG has begun to hurt its competitors by investing in products that appeal to the low-end markets in developing countries such as India and the premium markets in the US and Europe. LG’s most advanced phones have GPS and TV capabilities.
The companies which are the most vulnerable to LG’s success are Motorola and Sony Ericsson. Their product lines have already proved to be too narrow or too poorly priced to do well. Both companies have been losing market share over the last several quarters. LG means to make sure that does not change.
Douglas A. McIntyre
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