Samsung, LG emerge mobile tech leaders, lag in XR industry

South Korean companies, particularly Samsung and LG, have played pivotal roles in driving technological advancements and market maturity, starting from the early development stages of the global mobile phone and smartphone industries. However, in the XR (eXtended Reality) domain, despite Samsung’s initial efforts in developing the Gear and Odyssey series headsets, its presence in today’s global XR industry has been relatively subdued.

A turning point emerged around 2023, with the launch of Apple’s Vision Pro. We have since witnessed South Korean tech giants significantly increasing their investments in the XR segment, trying to capitalize on potential opportunities in the emerging spatial computing era.

In the following sections, we will summarize the noteworthy developments and strategies adopted by these South Korean companies, and analyze their impacts on the global XR landscape.

Samsung Electronics
During the Mobile World Congress (MWC) 2024, Samsung Electronics unveiled a collaboration with Google and Qualcomm to develop its new headset aptly named “XR” for now. This reflects these companies’ ambition to revolutionize the world of AR (Augmented Reality), VR (Virtual Reality), and MR (Mixed Reality) experiences. The anticipatedly significant partnership is expected to set a new benchmark within the Android ecosystem, leveraging the leading capabilities of these three companies in device development, component and chip design, as well as software and Operating System (OS) innovation.

In addition to advancements in the development of end devices, Samsung has also ramped up investment in XR components through its 2023 acquisition of eMagin, the world’s leading Micro OLED technology provider. eMagin is known for its directly patterned RGB OLED microdisplay technology, which presents a higher entry barrier but holds distinct advantages in brightness, module thickness, and power consumption compared to the relatively mature WOLED+CF solution. This acquisition is expected to offer competitive advantages to Samsung Display (SDC) and Samsung’s XR headset businesses once the display panels developed by eMagin and SDC become commercially available. Apart from the advanced displays, Samsung is also reportedly developing the Low Latency Wide (LLW) IO DRAM, which boasts more efficient processing of real-time data for applications in XR, Gen AI and gaming-related devices.

We expect Samsung’s new “XR” device and these advanced components and technologies to debut in 2024/2025. While Samsung will collaborate with Qualcomm for its new “XR” device, we expect that its fabless subsidiary Samsung LSI may venture into designing its in-house XR SoC or co-processors as the global XR market gains momentum going forward.

LG Electronics
LG Electronics is also actively investing in allocating resources to the XR segment to capitalize on future opportunities.

LG Display (LGD), one of the subsidiaries of LG Electronics, reportedly partnered with Meta and SK Hynix to develop Micro OLED displays starting in 2023. In another development, LGD also acquired MicroLED-related patents from a Taiwanese company Ultra Display Technology, with the majority being transfer process patents, aiming to bolster the development and manufacturing maturity of MicroLED panels. These initiatives demonstrate LGD’s ambition to close the gap with current market leaders such as Sony and JBD, to become a prominent leader in the supply of advanced display panels for XR devices.

LG Innotek, another subsidiary of LG Electronics, has made strides in the XR optical components domain by investing in the Taiwanese lens manufacturer AOE Optronics in 2024. This strategic move aims to harness LG Innotek’s optical design expertise and process automation capabilities, complemented by AOE’s proprietary materials, mold processing, and precision lens manufacturing technologies. By synergizing these strengths, LG Innotek aims to seize business opportunities in the global automotive and XR industries.

We expect the proactive initiatives of LG Electronics’ affiliates to synergize with LG Electronics, bolstering the company’s unique strengths and positioning it as a key player in the global XR segment. Recently, Meta announced a strengthened partnership with LG Electronics to develop the next-generation XR device, leveraging LG’s expertise in hardware as well as its content and service experiences in the TV sector. This collaboration signifies an important step forward for LG Electronics, and we look forward to witnessing the innovative advancements that will result from this partnership.

Policy Makers, Local Associations and Telecom Operators
Recognizing the immense growth potential of the global metaverse economy, the South Korean government published the Immersive Economy Development Strategy (Beyond Reality, Extend Korea) in 2020. In 2021, South Korea’s Ministry of Science and ICT (MSIT) founded the “Metaverse Alliance,” which includes member companies such as Samsung, LG, Kakao, and Hyundai Motor, to develop a “metaverse” platform and enhance XR technology applications across industrial sectors. Building on these initiatives, in 2023, the South Korean government took a further step by establishing the XR Convergence Industry Alliance. This alliance aims to foster inter-sector cooperation in technology and business, explore joint R&D opportunities, and develop infrastructure to create a convergence ecosystem for the XR industry in the country.

South Korean telecom operators SK Telecom (SKT), KT, and LGU+, which were among the world’s first to commercialize 5G networks in 2019, have also been among the earliest movers globally in promoting XR and the metaverse services. In their latest development, SKT introduced its self-developed metaverse platform, the “Ifland”, in 2021, and collaborated with local gaming companies to co-develop VR games compatible with Meta’s Quest devices. To date, SKT has continued to strengthen its metaverse efforts by expanding international partnerships for the “Ifland” platform. KT also launched an open beta version of its metaverse platform, the “Genieverse,” in 2023. Furthermore, KT plans to provide content empowered by GenAI technology, such as AI motion dance and AI avatar messages, to the “Genieverse” platform. As for LGU+, it introduced a metaverse-based platform targeting young children, called “Kidstopia,” in 2023. In 2024, it established a partnership with Dong-A Science Reproduction to collaboratively develop metaverse experience content, to enhance the competitiveness of the “Kidstopia” platform. Counterpoint Research