LG expects Optimus Q to help it get back into smartphone war
The world's third-biggest handset producer LG Electronics is worrying about the decreasing profits of its struggling mobile division due to a limited presence in the world of smartphones.
LG is in the process of implementing detailed strategies for smartphones in its key overseas markets and will soon launch what company officials say are "killer products" for better penetration of the market.
"One clear thing is LG Electronics has continuously been en route to producing premium smartphone models and the efforts start paying off," a company spokesman Yoon Won-il said.
Its latest LG-LU2300 model dubbed as "Optimus Q" is now its top driver for competitive smartphone growth.
LG said the Optimus has sold over 20,000 units a week since its local debut. Officials at LG Electronics and LG Telecom said talks are under way to increase the shipments of the Optimus to meet the rising consumer demand.
"The initial sales results are reaching the level comparable to those of LG's hit model, Cookie. Considering its higher prices, the initial performance is very impressive," Yoon of LG said.
The suggested retail price for the Optimus was 900,000 won ― similar to Samsung Electronics premium Galaxy S. With contracts and subsidies, consumers will pay between 240,000 and 270,000 won for the LG smartphone.
In terms of specifications, the Optimus is LG's most advanced model.
The 1GHz Snapdragon-powered smartphone, which runs on the Android 2.1 operating system, packs a slew of goodies that will make any geek salivate.
"For the layman, however, all you need to know is that this phone won't be obsolete the moment it leaves the store, considering it is equipped with a 3.5-inch AM-OLED capacitive touchscreen display, a slideout QWERTY keyboard, DivX playback, Wi-Fi connectivity, a DMB tuner and a 5-megapixel camera with geo-tagging," said 35-year-old office worker Kim Hye-jin who recently bought the device at one of LG’s local outlets.
Meanwhile, the phone also offers easy access to customized applications such as "RSS Reader" and "Screen Capture" to sensitive South Korean users on its smartphone-only user interface, officials say.
For greater consumer satisfaction, LG is planning to provide various contents such as movies, animation and music video clips to users via its LG Apps for free.
LG's Yoon said the company has been set to enable users to download over 60 applications from its store without any fees.
"We will steadily launch customized smartphones region by region. More Optimus models in the series are ready to show up on the market. In South Korea, we will continue the initial frenzy by launching various marketing campaigns," said Cho Sung-ha, who is in charge of LG’s Korean business.
LG has so far introduced 10 smartphones ― four of them using Android as the benchmark mobile platform and the remaining six, Microsoft's Windows Mobile.
LG is continuing its "two-track" strategy in the mobile phone business, which means premium phones in developed markets and low-priced mobiles in developing markets.
LG's business lost momentum late last year when its handset unit struggled with delayed product launches, a lack of hit models and the firm's slow response to the smartphone boom. LG has less than 1 percent of the global market.
Analysts clashed over whether LG could revive its mobile business. It plans to boost marketing, but the competition is only getting tougher as more players join the race.
LG has rapidly shifted priority to smartphones to boost "razor-thin" margins and catch up to big rivals such as Apple.
"It's true that LG was the latecomer to the smartphone market. But we see some constructive signs for LG's mobile division thanks to steady releases of new premium models in developed markets via leading carriers," said Yoon Hyuck-jin, an analyst at Shinyoung Securities.
"LG is getting good credit for its first Andriod phone in North America as strategic marketing promotions are lifting more sales. The VS740, which sells via Verizon Wireless, will help investors ease concerns over LG’s smartphonerelated strategies," Yoon said.
The local brokerage presented 160,000 won as its target price for shares of LG Electronics.