LG’s New Vision Includes Being a Media Company
LG Electronics wants to become a media company, expand its vehicle components into autonomous driving equipment, and for its retail outlets to exude “a dynamic and youthful look”.
The aspirations are part of LG’s “bold vision to transform LG into a smart life solutions company” announced yesterday. LG’s general strategy is to broaden its business model and centre on “customer engagement, combining services with hundreds of millions of LG devices used by customers around the world”.
That includes a business around servicing smart home equipment, an idea that may appeal to some consumers but worry others in terms of new costs that the smart home incurs.
Going forward, LG is banking on the success of its webOS operating system to further build its TV sales business, but it wants to expand its TV business into a “media and entertainment service provider” by expanding the presence of content, services and advertisements within its products.
It will plough KRW 1 trillion ($1.147 bn) over five years into LG channels, its advertising-based free broadcast platform, which it says went from 20 million users in 25 countries last year to 48 million users in 29 countries this year.
On home appliances, the South Korean giant plans a “home as a service” business around subscriptions and smart home services which it describes as “hyper personalisation”. It wants to monetise the smart home.
“LG ThinQ will support the emerging home solutions business that encompasses the entire house by adding services that customers need in the home complementing connected devices,” it says in its statement.
It will expand its home appliance and care service business to include product maintenance, management and cleaning.
LG also wants to expand its electric vehicle business to be worth more than $22.9bn by more than doubling sales by 2030.
It wants to complement its existing vehicle component business, which includes providing infotainment, audio and navigation systems, with equipment to aid autonomous driving, software solutions and content.
It also wants to double sales of its heating, ventilation and air conditioning business. “The company is establishing a localized business structure that covers research and development, production, sales and maintenance of air conditioning projects in major regions such as North America and Europe.
“Also, LG will pre-emptively prepare for the future in energy service sectors, such as energy storage systems, home energy management systems and virtual power plants.”
It said that over the past two years “the company boldly exited its mobile phone and solar panel businesses and, instead, focused resources on future high-growth areas”.
Digital healthcare in the US market and an EV charging business were also set for expansion, as was LG’s “strategic collaborations” in the metaverse.
“The development of augmented reality devices is underway at the Korean Ministry of Science and ICT’s project to advance the development of AR Glass Advancement and the building of content production ecosystem,” the company says.
It says various efforts are being made to provide a more immersive experience on large screens, such as TVs. It also plans to bring a “dynamic and youthful look” to its brand at customer contact points.
LG says the company’s sales and operating profit in the second quarter of 2023 were the highest ever for the second quarter and in the first half of 2023, LG recorded the second highest sales ever and its third highest operating profit.