In the space of a few short weeks we’ve seen Sony cease smartphone production in Brazil, Dell quit the Android tablet market, and LG show some of its execs the door after the “flagship G5 smartphone failed to generate sales.”
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This is a classic case of too many hardware makers and not enough customers. And while Sony ceasing production in Brazil is down to a number of factors – although the word is that sales in that region didn’t pan out as expected – Dell’s exit and LG firing executives are both purely down to sales.
And it’s not because Dell and LG didn’t make good hardware. The Dell Venue 8 7000 is probably the best Android business slate available (even if the name is a mouthful). But the tablet market is contracting rapidly, as consumers turn away from pure tablets in favor of 2-in-1 devices. The eagle-eyed among you might have noticed how few tablets were on show at CES this year, and how Google really downplayed tablet features in its new Android Nutella, I mean Nougat.
And while the LG G5 was expensive, and came with high-priced “friends” (the name LG gave to the modules that attached to the device), it was a flagship device from a company that had the courage to innovate.
LG was once one of the biggest Android OEMs, but according to Gartner by the beginning of this year it had fallen to seventh in global smartphone sales, with a market share of less than 4 percent.
LG it seems doesn’t even want to gamble any money on adverts to increase brand awareness of its own product.
And no wonder. While Android might have 80 percent of device sales, it only pulls in some 20 percent of the money. Apple’s figures here are reversed, which gives the company considerable resources for advertising and R&D into new products.
So what’s going on here?