News Reality

The Note 7 Meltdown Will Haunt Samsung For A Long Time

by www.huffingtonpost.com

By Brian Barrett for WIRED.

The Galaxy Note 7, Samsung’s flagship smartphone, reached customers on August 19. Within two weeks, 35 of the devices had either caught fire or blown up outright, prompting a voluntary recall of millions of handsets. And now, with replacement devices suffering the same explosive fate, the company has halted production. It doesn’t get much worse than this.

Update: Samsung has reached a “final decision” to stop all Note 7 production. It won’t be making any more, but that doesn’t make its problems go away.

Samsung’s latest step is absolutely the right thing to do. The fault in its Galaxies isn’t muddled reception or chipped finishes. The battery malfunction at the root of the issue can cause serious damage and bodily harm. But it’s also going to have serious implications for the company, and for a long time to come.

Phone Home

If you have a Note 7, replacement or original, return it, full stop. Samsung has a site with detailed instructions, but the simplest thing for most people is to take the device — whether you’ve personally experienced problems or not — back to your carrier. Verizon, AT&T, T-Mobile, and Sprint will all let you exchange them for any other smartphone, regardless of when you bought it.

Do this right now. Immediately. Don’t wait. If you need any further indication of how serious it is, those same four carriers will literally not let you exchange your Note 7 for another Note 7. They also won’t sell you a new one. They’re off the shelves. Until everyone knows for sure what’s wrong with them, they need to be out of circulation entirely. And yes, even Samsung’s on board with this.

“We recognize that carrier partners have stopped sales and exchanges of the Galaxy Note 7 in response to reports of heat damage issues, and we respect their decision,” the company said in a statement, adding that its investigation into the issues remains ongoing.

Lithium-ion battery chemistry is a tricky thing, though. Samsung already thought it had fixed the problem once, only to see five replacement devices suffer the same fiery fate. There’s no telling how long it’ll take for the Note 7 to be safe again.

“This is the worst-case scenario for Samsung,” says Jan Dawson, chief analyst at Jackdaw Research. “Now that the replacement devices seem to be having the same problems, it calls into question Samsung’s whole product testing methodology and its scrutiny of its suppliers. That’s much worse than a one-off.”

And it should have much more serious reverberations.

Now that the replacement devices seem to be having the same problems, it calls into question Samsung’s whole product testing methodology and its scrutiny of its suppliers.

Going Down

The Note 7 is far from Samsung’s only product; it’s not even the company’s only flagship. But it’s one of the most popular smartphones available, and critical to the company’s mobile aspirations. By the time of that first recall, just a few weeks after going on sale, it had already sold 2.5 million units. Its ceiling was much higher.

“These phones should have sold well over ten million units, but instead Samsung may well end up selling very few and destroying much of the inventory, while buyers replace Note 7 devices with iPhones and other competing devices,” says Dawson.

The only way for Samsung to retain its customers, at this point, is for them to downsize to the smaller Galaxy S7 or S7 Edge, which is no sure bet. There’s ample competition out there, after all. Apple just released the latest iPhone. Google Pixel presents a high-end Android competitor (though only through one major carrier, Verizon). And the likes of LG and Motorola have innovative, non-exploding, premium handsets to tempt people to their side.

That wouldn’t nearly as serious an issue if Samsung had actually fixed the problem. The Note 7’s fan base is a loyal one, says Gartner analyst Tuong Nguyen.

“We’re talking about Samsung’s high-end, flagship product. The people who bought this wanted a Samsung, and they wanted a Note 7,” says Nguyen, who notes that few people would throw $900 at a smartphone arbitrarily. “You choose the cherry red Corvette because you wanted the cherry red Corvette.”

Nguyen sees more opportunity for competing Android manufacturers than for Apple, given the inconvenience of jumping from one operating system to another. Regardless of what alternative people choose, though, Samsung’s position remains the same: Warehouses full of unsellable fire hazards, and a flagship model with an uncertain future.

The recall so far hasn’t had a crushing financial impact; Samsung reported a profit in the most recent quarter, which included the first round of Note 7 returns. A fresh round of problems, though, means more trouble for Samsung’s bottom line. And, even more importantly, its reputation.

Fire Brand

The biggest problem for Samsung right now is that there are still potentially millions of devices in circulation that could overheat. And the longer the issue takes to resolve, the broader the awareness.

Airlines have for weeks been asking passengers to power down their Note 7 devices before takeoff (though even that didn’t stop one Note 7 from catching fire before a Southwest flight last week). It’s not just Note 7 owners who know there’s a problem. It’s anyone who’s been on a long-distance flight.

“That definitely increases consumer awareness,” says Nguyen.

As does the constant barrage of news reports with each fresh incident. Note 7 danger has reached beyond tech news junkies; by now, it’s mainstream. And it keeps getting worse, in a way that may have implications beyond just one device.

“To be in a situation where you claim to have identified the issue and solved it, only for the exact same issue to pop up again despite the supposed solution, is not a good look for a company of Samsung’s size,” says Dawson. “The perceptions that flow from this may well spill over into other parts of their product portfolio.”

Not every Note 7 will overheat; in fact, only a small percentage of them has. But for as long as there are units in circulation, there’s a chance for yet another incident, another round of headlines, another damaging blow. The way the smartphone business works, that may not take long to snowball.

“Brand loyalty is extremely important, but you don’t see it much now in the smartphone space outside of Apple,” says Nguyen. “Everyone’s at a precarious point, so something like this shakes what little brand value has been established.”

Samsung’s Choice

All of which puts Samsung in a difficult position. They can make this halt in production permanent, taking a mulligan on its most important mobile release this year and hoping no more incidents arise in the smartphones currently out there. Or it can continue to retool, risking another misfire and the damage that would go with it.

“At this point, Samsung should scrap the Note 7 altogether and move on,” says Dawson. “The longer this lingers on, the longer the brand impact will stick around too, and the harder it will be to move on from it.”

The financial hit would be substantial. But it may still be better than letting Samsung’s reputation go up in smoke.

More from Wired:

Gluing Galaxy Note 7 Batteries Down Made It Worse for Samsung

America’s Electronic Voting Machines Are Easy Targets

New Federal Law Would Sanction Government Hacking

What Happens When You Talk About Salaries at Google

Hackers Trick Facial-Recognition Logins With Facebook Photos

Inside Google’s Internet Justice Leage and It’s AI-Powered War on Trolls

-- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.


Read Full Article On www.huffingtonpost.com
Latest
Tourism and aviation form a nexus in Ireland that has unique and multiple effects across the economy.
Greencore shares rebounded by more than 9% yesterday after management reaffirmed the growth potential afforded by its recent purchase of US company Peacock Foods.
Saoirse Ronan’s star turn in awarding-winning Brooklyn has paid off for the young actor’s bank balance, with profits soaring over €430,000 at her entertainment firm.
Property firm Hibernia Reit said it has the resources to spend on growing its office holdings and may seek to expand its buy-to-let residential holdings.
The average Irish household owes over €30,000 — making Ireland the fourth most indebted country in the EU, the Central Bank has found.
Nokia has settled its legal battle with Apple with a new patent licence agreement and also signed a business deal with the US giant, surprising investors who had expected the dispute to drag on.
Irish travel software company Datalex has told shareholders that it expects to land a number of new client wins before the end of this year.
The Brexit squeeze on British consumers has hurt the UK government’s finances as well as retailers, new figures show, indicating that the economic slowdown at the start of the year is now being
Local cooperative societies have begun a process to build a centralised digital database of their operations to reduce setbacks and financial losses.
HBO and Jon Stewart on Tuesday announced the cancellation of a highly-anticipated animated shorts project, but promised “future projects together,” the New York Times reports. On Tuesday, HBO an
Singer Adam Lambert says he would agree to be a judge on the "American Idol" revival in a heartbeat. The 35-year-old musician, who was the runner-up on the reality TV singing show's eighth season, sa
Singer Celine Dion says it is a matter of pride and honour for her to have sung hit love ballad "My Heart Will Go On" for the film "Titanic". The 49-year-old songstress recently sang the number from
Singer Blake Shelton says he loves having his girlfriend Gwen Stefani by his side as it builds his ego up. The 40-year-old musician, who has been dating the "Hollaback Girl" singer since 2015, says t
Actress Eva Longoria says she had never thought of getting married again. The 42-year-old actress, who got married to businessman Jose Baston last year, says she could not see herself walking down th
"Wonder Woman" will do away with the ever-growing trend of having a post-credit scene. Producer Charles Roven has revealed the Patty Jenkins- directed film will not feature a tagged on scene, reporte
Actor Sean Bean says he would like the character of Ned Stark to be "resurrected" on hit TV series, "Game of Thrones". The 58-year-old actor says he would be happy to reunite with the cast of HBO's f
In the wake of the Uttarkashi bus accident, Railway Minister Suresh Prabhu has instructed authorities to arrange a special train bogey to bring bodies to Madhya Pradesh on Chief Minister Shivraj Singh
At least six Tamil Nadu fishermen were apprehended along with a boat by the Sri Lankan navy near Neduntheevu island, last night.The fishermen were apprehended by the Lankan Navy near Delft island.The
No causalities or injuries were reported after Naxals triggered a blast in Chhattisgarh's Bijapur district on Wednesday.The District Reserve Group (DRG) arrested a Naxal, who was attempting to flee fr
Last year, taxis and cab aggregators accounted for 9% of total car sales
ADB said it in an investment programme that will improve connectivity and transport efficiency of state highways.f
The electric equipment maker had reported a net profit of Rs 9.6 crore during the previous quarter, HPL Electric and Power said in a statement.
The State Department has proposed $344 million in financial assistance and grant to Pakistan
A special Central Bureau of Investigation (CBI) court will today resume hearing in the 1992 Babri Masjid demolition case.The court postponed Monday's hearing as Satish Pradhan, one of the six accused,
Former “Late Show” host David Letterman on Monday told GQ he’s “disappointed” that Donald Trump is representing the United States, adding, “it makes me sick.” “I’m disappointed that this man is
Foreign-exchange markets reacted to the news, with the Australian dollar dropping from levels around $0.7480 to as low as $0.7452 in the wake of the announcement.
TOKYO (Reuters) - China's main stock index fell one percent and the Australian dollar slipped on Wednesday after Moody's cut its sovereign credit rating on China.
Samsung Electronics is investigating claims by a German hacking group that it fooled the iris recognition system of the new flagship Galaxy S8 device, the firm said today. The launch of the Galaxy S8
Newark Liberty International Airport in New Jersey temporarily shut down after an engine fire prompted the evacuation of an airplane, officials said. There were no immediate reports of injuries. The
The fate of 100,000 current Bell MTS wireless customers — at least insofar as whether or not they have been selected as part of the migration to Telus — will ......
The ratings firm’s action underlines the difficulty Beijing faces in pushing economic growth while tackling problems in its financial system.
The agency cites erosion of financial strength over the coming years for its re-assessment.

Recent News

India considering punitive actions against Pak: US official

India is moving towards isolating Pakistan diplomatically and is considering punitive actions against Islamabad for its alleged support to cross border terrorism, a top American defence intelligence c
Read Full Article

Newark airport closed after engine fire prompts plane

Newark Liberty International Airport in New Jersey temporarily shut down after an engine fire prompted the evacuation of an airplane, officials said. There were no immediate reports of injuries. The
Read Full Article

Samsung investigating Galaxy S8 'iris hack'

Samsung Electronics is investigating claims by a German hacking group that it fooled the iris recognition system of the new flagship Galaxy S8 device, the firm said today. The launch of the Galaxy S8
Read Full Article

I'd like to see Ned Stark resurrected: Sean Bean

Actor Sean Bean says he would like the character of Ned Stark to be "resurrected" on hit TV series, "Game of Thrones". The 58-year-old actor says he would be happy to reunite with the cast of HBO's f
Read Full Article

'Wonder Woman' not to have a post-credit scene

"Wonder Woman" will do away with the ever-growing trend of having a post-credit scene. Producer Charles Roven has revealed the Patty Jenkins- directed film will not feature a tagged on scene, reporte
Read Full Article

Eva Longoria never thought she would remarry

Actress Eva Longoria says she had never thought of getting married again. The 42-year-old actress, who got married to businessman Jose Baston last year, says she could not see herself walking down th
Read Full Article

Blake Shelton loves having Gwen Stefani by his side

Singer Blake Shelton says he loves having his girlfriend Gwen Stefani by his side as it builds his ego up. The 40-year-old musician, who has been dating the "Hollaback Girl" singer since 2015, says t
Read Full Article

Being a part of classic like 'Titanic' a big honour: Celine

Singer Celine Dion says it is a matter of pride and honour for her to have sung hit love ballad "My Heart Will Go On" for the film "Titanic". The 49-year-old songstress recently sang the number from
Read Full Article

Adam Lambert would love to judge 'American Idol'

Singer Adam Lambert says he would agree to be a judge on the "American Idol" revival in a heartbeat. The 35-year-old musician, who was the runner-up on the reality TV singing show's eighth season, sa
Read Full Article

Popular Finance

Judge 'underwhelmed' by sheriff's search for evidence in O.C. snitch scandal

The Orange County Sheriff’s Department insists it has been working hard to comply with a judge’s long-standing orders to divulge records concerning its handling of jailhouse informants. On Tuesday
Read Full Article

Sean Hannity on Seth Rich conspiracy theory: 'I am not going to stop trying to find the truth'

Fox News and conservative talk show host Sean Hannity are under fire Tuesday for pushing a right-wing conspiracy theory that Democratic National Committee staffer Seth Rich may have been killed be
Read Full Article

7 things you need to know about how Trump's budget would affect schools in California and nationwide

President Trump's proposed budget would cut federal education spending, increase charter school money, eliminate some programs and create a new grant program for funding school choice.
Read Full Article

Baseball: Southern Section playoff scores and updated pairings

Read Full Article

Wednesday's TV Highlights: The CW's 'Arrow' on KTLA

SERIES Survivor The season finale of the unscripted competition will reveal which one of the remaining contestants will “outwit, outplay and outlast” the others. Immediately afterward, Jeff Prob
Read Full Article

Engine catches fire on United Airlines flight headed to San Francisco

New Jersey's Newark Liberty International Airport has temporarily closed after a plane engine caught fire. United Airlines Flight 1579 from Newark to San Francisco was scheduled to take off Tuesda
Read Full Article
 

How To Develop Your Residential Investment Strategy In The Southeast

Real estate markets in the southeast are largely independent from one another. Finding a market with the right mix of renters and home prices requires some work.
Read Full Article

Sean Hannity: 'I am not going to stop trying to find the truth'

Fox News and conservative talk show host Sean Hannity are under fire Tuesday for pushing a right-wing conspiracy theory that Democratic National Committee staffer Seth Rich may have been killed be
Read Full Article

Trump budget underscores new national priorities: slashing the safety net and taxes

Even President Trump distanced himself from his inaugural budget, literally, as it was released on Tuesday while he was overseas. Republicans in Congress said they will write their own, and Democr
Read Full Article