LG, Prada Look to Continue Joint Product Development

LG Electronics and Prada are looking to continue their handset partnership or develop additional products together, even though no concrete plans yet exist, according to executives from both companies.

The second-generation LG Prada handset was released in Europe late last year and recently went on sale in Asian markets, such as Singapore.

"We've been working together now for about four years, so it is already a long-term partnership. We'll be only happy to continue collaborating with LG," said Matteo Sessa Vitali, Prada's licensing director.

"For the moment, our approach is to concentrate on this project. It's not that we've already got everything planned for the future, but we have a sort of open conversation and are trying to collaborate also in other areas of our businesses. We'll see," he said.

If the companies do release additional products together, that decision will ultimately depend on the specific product idea rather than a set timetable.

"We are not trying to launch a product every year, or every second year. When we have a good idea, then it's time to make the product," said Chang Ma, vice president of the marketing and business strategy team at LG Electronics' mobile communications unit.

The first LG Prada phone was released in 2007, hitting the market just before the release of Apple's first iPhone. At that time, the two handsets were often compared because of their full-size touchscreens, but the LG Prada phone never came close to matching sales of the iPhone, with just 1 million units sold. Nevertheless, that figure exceeded sales expectations for the first-generation LG Prada phone and the partners decided to develop a second handset.

"We were very happy, so we said let's see if we can come up with a second product and we started to discuss alternatives, but then we always got back to the first one. We always liked the first design better than the new ideas we had," Vitali said.

The second version of the LG Prada phone closely resembles that of the first, but includes one significant addition. While Apple maintained its reliance on the touchscreen interface with the 3G iPhone, Prada and LG opted to include a slide-out keyboard in their latest design in order to make it easier for users to type longer e-mails.

The phone can also be paired with a wristwatch accessory, called Prada Link, that's able to display call details and SMS messages over a Bluetooth link with the phone.

While LG and Prada hope the design of the second-generation handset will appeal to users, the phone faces tougher competition than its predecessor. Among the crowded field of rivals, Apple's 3G iPhone is now available in markets around the world, and HTC's G1 handset, which has a slide-out keyboard and runs Google's Android operating system, has a growing fan base.

On the corporate side, Research In Motion's BlackBerry line remains a favorite of business users and the company has revamped its designs in recent months with products such as the BlackBerry Bold and touchscreen-based Storm.

Despite stiff competition from rivals, LG and Prada are counting on users of the first version of the handset and brand-conscious consumers to drive sales of the new handset, despite the economic environment.

"Prada customers will be the core target that we are looking for," Chang said.

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