LG plans to grow its TV business with more ads and content recommendations

MW
Mike Wheatley

LG Electronics has announced big plans for the future of its television business, saying it will play a major role in the future of smart homes. The company speaks of playing a transformational role in the development of “smart life solutions”, but in reality the biggest change for LG TV buyers will probably be more ads.

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At an event in Seoul, South Korea, LG Chief Executive William Cho outlined a new direction for his company. He said it will transform itself from a hardware-focused company which profits primarily from sales of its TVs into a “platform” business that generates revenue on an ongoing basis.

A central part of the company’s strategy is to integrate more ads within its webOS operating system, with more recommended content from its partners. The idea of more ads may not enthuse everyone, but LG insisted it’s part of a wider strategy to evolve into a connected smart life company.

LG said part of the plan involves expanding webOS to more third-party TV makers, which is a strategy it first embarked on in 2021.

In addition, LG will expand LG Channels, which is its free, ad-supported TV streaming service. It competes with services such as Samsung TV Plus, the Roku Channel, Pluto TV and others.

Elsewhere, the company promised tighter integration with its smart home ecosystem, which includes various products such as connected home appliances. Ultimately, LG said it wants to become a “media and entertainment service provider”.

The announcement doesn’t come as a big surprise, as LG is following a wider trend that has seen most TV makers embrace advertising and free content. Samsung Electronics, for instance, has adapted its Tizen operating system to show more ads and content recommendations, and Google has done the same with its Google TV/Android TV platforms, which are used by TV brands such as Philips, Sony, Hisense and TCL.

The trend isn’t entirely bad news, as consumers are benefiting from lower-cost TVs at the point of sale. Companies such as Amazon and Roku have recently introduced more affordable TVs that are supported by integrated ads and recommendations. Considering that these ads will likely make their way into the most premium TV models too, it’s by no means a bad thing that buyers have lower cost options.

It also raises the possibility that LG’s higher-end OLED TVs may also become cheaper. Considering that some companies are now even prepared to give away a brand new television for free, it may well make sense for LG to offer its most premium models at a lower price.