Posted : 2010-01-14 19:44
Updated : 2010-01-14 19:44

LG to Keep Partnership With Microsoft

Ahn Seung-kwon, mobile phone
chief of LG Electronics
By Kim Yoo-chul
Staff Reporter

LG Electronics will keep the strategic partnership with Microsoft though its U.S. partner has recently been struggling due to the skyrocketing consumer demand for Google-powered Android phones, a company executive said.

Ahn Seung-kwon, president of LG's mobile communications division, said the world's third-biggest handset vendor after Nokia and Samsung, however, will heavily bet on phones with Google's Android operating system.

"MS Windows Mobile operating system is rather unqualified in mobile interfaces. Despite such worries, the partnership with Microsoft is still safe," Ahn said at a press conference in Seoul.

LG plans to introduce a smartphone equipped with Windows Mobile 6.5 operating system later this month.

"We plan to increase the portion of Android phones to half of 20 smartphones that LG has been set to launch in the global market in 2010," the executive said.

The remaining 10 smartphone offerings will run on Windows Mobile and Linux software.

In February last year, LG struck a deal with MS, saying Windows Mobile will become the primary operating system for its smartphones.

The remarks are expected to help Microsoft extend its thinner lifeline longer at a time when major handset vendors and consumers are rapidly shifting to contents-featured and open-based Android mobiles.

To strengthen its competitiveness in the smartphone segment, LG Electronics will expand the number of research and development (R&D) staff members by the end of this year.

"LG Electronics plans to launch smartphones with more affordable prices. In order to better penetrate into the smartphone sector, LG hopes to seek a key flagship smartphone model that could sell over 10 million units," Ahn said.

Asked about a plan to develop its own operating mobile system, the executive said the company will focus on Android OS and Windows Mobile.

Ahn also said LG Electronics will lower its high dependence on the North American market and show more interests in Europe and emerging markets.

"It's true that LG Electronics is vulnerable upon variables in North America. We will further lower the dependence on the market this year," he said.

The portion of LG's handset sales solely in North America was 30 percent, which is higher than Samsung Electronics' 20 percent.

To Outpace Samsung

LG Electronics aims to sell 140 million units of mobile phones globally in 2010 _ an increase of 20 percent from last year. It also plans to become the world's second-biggest handset vendor after outpacing Samsung Electronics by 2012.

"LG has been in the stage to reshape the mobile industry. If we continue to achieve a double-digit growth, it will be possible to be ranked the world's No. 2," he said.

In 2009, the company had a 10 percent share of the global handset market. It sold 117 million units, last year

Ahn said LG Electronics will expand its outsourcing channels from manufacturing, R&D to designs to save the costs and increase efficiencies.

LG has joined the ranks of Nokia and Apple to increase OEM-based products. But LG's move is different from Samsung. Samsung Electronics recently said it won't expand clients' channels for OEM-based manufacturing.

"LG has been in the final stage to strike a new partnership with a top-tier contents provider as securing premium contents have been emerged as the top issue for the sustainability of our handset growth," according to the executive.
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