From DailyTech: On Monday South Korea's LG Electronics, Inc. will bring its well reviewed international Android flagship device, the LG G3, to China. The device will retail for CN¥ (yuan) 3,999 (~$650 USD), around the same price as Samsung Electronics Comp., Ltd.'s Galaxy S5 and Apple, Inc.'s iPhone 5S.
The LG G3 has been a shot of adrenaline in the veins of the Korean electronics giant's struggling smartphone unit. After climbing to third place in global smartphone shipments in Q1 2013 (behind Apple and Samsung), China's Lenovo Group, Ltd. (HKG:0992) bumped it to fourth place in Q3 2013.
In Q2, with the help of the LG G3, LG solidified its U.S. market share, rising to 11 percent according to numbers from Counterpoint Research. Those strong U.S. sales drove it to 14.5 million total global smartphone sales and its first profit in a year. But in global sales Lenovo slipped to fifth, behind rising Chinese OEM Xiaomi, Inc. A major cause for that slippage was Lenovo's struggles in the Chinese market, where LG wasn't even in the top ten.
Over half of smartphones sold in China are sold under a business model similar to America's more traditional cellular carriers, a model in which carriers offer big subsidies to try to lure customers into buy expensive handsets which are paid off by inflating contracts.
But China's top carrier China Telecom Corp., Ltd. (HKG:0728) has started to shift away from this model, lowering subsidies. Some believe that it's hoping to shift to an unsubsidized model similar to most European carriers or upstart American carrier T-Mobile U.S., Inc. (TMUS). The move is being keenly watched as China Telecom is viewed as the most successful disruptor in the world's biggest mobile market, rising from a 4 percent market share in 2008 to a 15 percent stake in 2013 -- good enough for third place and 185 million customers.
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