[Corporate Research Institute] Development of 'Smart Brick' with Semiconductor Chip... LEGO Continues to Evolve After 94 Years

(21) "Only the Best Is Good Enough": Danish Company LEGO
Cutting-Edge Technology Embedded in Classic Bricks
Nearly a Decade of Development Investment Delivers a New Play Experience

Editor's NoteIn 2022, South Korea ranked second globally in corporate research and development (R&D) spending, and in 2020, it ranked fourth in the number of patent applications filed in the United States. However, the annual average growth rate of corporate productivity dropped significantly, from 6.1% between 2001 and 2010 to just 0.5% between 2011 and 2020. This decline is attributed to the slowdown in productivity growth among so-called "innovative companies" that are active in innovation activities. Without change, companies risk being neglected by the market. To help the industry revive its innovation DNA, we look at cases from leading global companies that have pioneered innovation. Innovative companies will serve as a catalyst to boost Korea's stagnant economic growth rate.

Danish company LEGO Group participated in the world’s largest electronics and IT exhibition, CES 2026, for the first time in its 94-year history, showcasing its digital technology innovations. The "Smart Brick," which adds cutting-edge smart technology to the traditional 2x4 LEGO brick, is regarded as the biggest innovation since the introduction of the minifigure in 1978.

The Smart Brick is one of the devices that implements "LEGO Smart Play." Equipped with a custom ASIC chip and sensors, it can interact with its surroundings, such as sounds and lights. The Smart Play system, which incorporates as many as 25 patented technologies, consists of the Smart Brick, the Smart Tag (2x2)-which outputs sound effects and LED light feedback appropriate to the situation-and the Smart Minifigure, all working in tandem.

Children playing with the 'LEGO Star Wars All-in-One' set. LEGO Group

The Biggest Innovation Since the Introduction of the Minifigure

LEGO devoted nearly a decade to developing Smart Play, which enables interactive play without a screen. To create a new dimension of play, the company assembled a team of experts from diverse fields, including video games, electronics, industrial design, architecture, computing, sound, and user experience. After hundreds of trials and errors, LEGO succeeded in creating a product that incorporates state-of-the-art technology without feeling overly technical.

The Smart Brick, which contains a light sensor, accelerometer, sound sensor, and a miniature speaker, can be wirelessly charged via a coil, much like an electric toothbrush, instead of using a plug. It was also designed to generate an infinite range of sounds by adjusting frequency and amplitude based on the same sound source.

Smart Play is recognized as an innovation that remains true to the essence of LEGO, as it implements smart technology within the brick itself without the need for auxiliary devices like smartphones or tablets. As Julia Goldin, LEGO Group’s Chief Product and Marketing Officer, stated, "Ways of playing must evolve with the times." There are high expectations that this Smart Play system will mark both the pinnacle and a turning point in LEGO’s digital transformation.

A visual representation of a situation where Smart Brick, Smart Tag, and Smart Minifigure interact with each other. Lego Group

LEGO has led the global toy market with bricks that enable creative play and learning, guided by its management philosophy, "Only the best is good enough." LEGO’s founder, Ole Kirk Christiansen, began by making and selling wooden toys in Billund, Denmark. After founding LEGO in 1932, he laid the foundation for the company by switching from wood to plastic bricks in 1947. When LEGO began producing bricks in an interlocking format in 1949, it became a completely new kind of toy and was reborn as a symbol of innovation. The introduction of the minifigure in 1978 propelled LEGO to unrivaled popularity.

Near Bankruptcy in 2004... A Comeback by Focusing on the Core

LEGO was not without its crises. In the late 1990s, as the internet and video games spread, the company faced near bankruptcy in 2004. LEGO attempted to address this by diversifying its business-reducing its reliance on plastic bricks, launching its own video game company, opening theme parks, and introducing pre-assembled minifigures-but the situation only worsened. Eventually, the third-generation chairman and grandson of the founder, Kjeld Kirk Kristiansen, resigned, and 36-year-old executive Jorgen Vig Knudstorp was appointed as the new CEO. At that time, CEO Knudstorp sought to refocus on LEGO’s core, and the company succeeded in making a comeback. The strategy of returning to bricks and breaking the vicious cycle of reckless innovation and diversification proved successful.

With the rapid spread of smartphones, LEGO faced a shocking decline in sales and operating profit in 2017 for the first time in a decade. Thomas Kirk Kristiansen, the fourth-generation chairman and great-grandson of the founder, recruited Niels Christiansen as CEO to turn things around. Christiansen, who had been CEO of Danish energy company Danfoss, had successfully transformed Danfoss from a traditional heating and cooling equipment manufacturer into an energy efficiency solutions provider through digitalization.

CEO Christiansen made large-scale investments in LEGO’s digital transformation. He integrated augmented reality (AR) into LEGO products and built the "LEGO Life" community app. At the end of 2023, LEGO also launched the "LEGO Fortnite" game in collaboration with Epic Games. Finally, LEGO applied digital technology even to the bricks, which it had long considered its core. The timing of Christiansen’s appointment as CEO closely coincided with the start of Smart Brick development. It is no exaggeration to say that LEGO devoted all its efforts to developing the Smart Brick. At one point, the production line for the new Smart Brick was as long as seven school buses (6-7 meters each), and there were as many as 160 workbenches involved.

LEGO plans to gradually expand its product lineup featuring Smart Play technology, starting with the "LEGO Star Wars All-in-One" set. A LEGO Group representative stated, "We have confirmed that, for children to become immersed in LEGO play, the technology must remain unobtrusive," adding, "Technology should not dominate play, but should naturally expand a child's imagination and creativity."