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LG Cuts its cellphone sale targets by 25%

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Posted by Greg Mills

As the tech press is full of stories of Apple ramping up its future iPhone production to a level that assemblers might even have trouble meeting, one of the Android / Windows handset makers is hedging its bet. LG released information as to its sales targets for the next few quarters.

The process of manufacturing electronic devices takes a while to get new products from the drawing board to the hands of consumers. The job Apple’s logistic arm, under the watchful eye of Timothy Cook, does is to anticipate the sales numbers well in advance for each new product they launch. Be too conservative and you run out of stock and lose sales, get too aggressive and have an over supply of something you can’t sell.

LG is making similar decisions now, as to how many cellphones to make of each flavor. The current market information indicates to them that they might be over building Android handset by about 20%. Competition from Apple iPhone is only part of the situation for LG. The Android handset makers are very competitive with some lower end handsets being designed as freebees with a two year contract. Some have speculated Apple might launch a low end iPhone to meet that market segment.

Samsung and about 6 other handset makers are all supplying Android handsets to the market. If things go badly for the Android platform in court and trade commission hearing, disaster may be in the works. Apple’s patent suits against every Android handset maker certainly have created a bit of stress for the defendants. Being sued by Apple is no picnic, to be sure. If Android flounders, Microsoft is waiting in the wings with its lackluster mobile platform.

Compounding the situation, LG made the mistake in 2008 that Nokia just made last month. They relied to much on Microsoft. Just as Android was being launched LG got on board with with Microsoft on the Windows Mobile platform which has been very disappointing and also serious distraction. Windows smartphones have not been a boon to the industry. Windows Mobile is still only around 1% of the market. LG does have a cool glasses free 3D phone at the top of their line.

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