The company would’ve never expected this day, but they are witnessing one of the worst times, especially because we are talking about one of the most popular series from Samsung here. The Samsung Galaxy Note 7 retires, as Samsung, the South Korean electronics giant announces that it is permanently discontinuing the device.
One doesn’t need to know marketing, business standards or finances to guess how badly this fiasco of Galaxy Note 7 battery explosion has damaged Samsung’s reputation already, and after the recent news of the replacement units also getting exploded, they had no other resort and first, it was a statement sent out requesting users to power down their devices, followed by a statement saying that the Note 7 will now be out of the market.
There was an immense pressure from the regulators and carriers regarding this issue and Samsung had to halt its sales through them. The U.S. Consumer Product Safety Commission, Korea Agency for Technology and Standards and then every Airline made it clear that the device is not safe to charge in a flight and it should be kept powered off if a passenger is carrying it along.
Samsung had also started the process of recalling the huge number of Note 7 devices that were already sold, accounting to about 2.5 million units, and according to analysts in the Industry, the latest step could cost Samsung close to $2 billion in total because the replacement units were also made.
“What happens to the next version of the phone when it comes out and how much this is going to impact the sales?” said Dan Baker, an analyst at Morningstar Inc. in Hong Kong. “It’s not just the phone; their whole ecosystem is behind this — displays, memory chips. If their phone sales drop, then their sales of other parts of the business will be impacted. It’s a spiral.”
Samsung has not yet made it clear on what it would do with the devices and how would it urge the users to send back the devices, but the discontinuation of the Note 7 is confirmed.
It is a matter of crisis for the South Korean company as the PR disaster happened just in time when Apple has released its new iPhones this year. Samsung’s Note 7 was supposed to compete against the iPhone 7 Plus, and it is the Samsung devices that stand in contention every year, but this time, the flagship Galaxy S7 and its Edge variant would be the best ones at offer from Samsung, until the company launches its successor in 2017.
Source: Bloomberg
RIP Note7