Samsung’s mobile business is not in good shape right now. Thanks to a problem with the Samsung Galaxy Note 7’s battery which potentially causes Galaxy Note units to explode and catch fire; much like the cheap so-called hoverboards. And where are those boards now? Samsung’s stock is currently in a nosedive since the Galaxy Note 7 problem puts the integrity of Samsung’s other products into question. Samsung has another problem.
Due to trust issues, Samsung could open the market to Apple, Microsoft, Sony, Google and other mobile manufacturers. Despite the game-changing removal of the headphone jack and replacement of the mechanical home button, the iPhone 7 now looks promising to potential upgraders or those disillusioned with Samsung. The company has already recalled all their Galaxy Note 7s. The recall plus the expense of replacements could cost the company 1 billion dollars or more. Forget the 1 billion, 14.3 billion was just shaved off Samsung’s market value.
“…The most important thing is whether the new Note 7 which will be released from now on will have another problem or not. If it has a problem, it will have a bad impact to the Note 7 and the Galaxy S8 which will be released in the first half of next year…”
— Myung Sub Song, analyst, HI Investment & Securities
Consumers will now ask themselves, are they actually getting premium products from Samsung? Will the upcoming Galaxy S8 not blow up in my face?
But not all consumers know about the recall or still give their Note 7s the benefit of the doubt. Such hesitation recently caused injury to a six-year-old child when a Note 7 exploded. The kid is fine now but has developed a fear of phones. There’s also an earlier incident when a Note 7 exploded while being charged in a Sydney hotel and caused over a thousand dollars in damages. In Brooklyn, a Note 7 owner reported that his device suddenly burst into flames. The Federal Aviation Administration has already advised owners not to turn on or charge their devices while in flight. They are advised to keep their devices with them as they’re not allowed in checked in baggage and in overhead bins. Samsung’s advice to owners is to turn off and exchange their devices.
“…We are asking users to power down their Galaxy Note 7s and exchange them as soon as possible… We are expediting replacement devices so that they can be provided through the exchange program as conveniently as possible… We sincerely thank our customers for their understanding and patience.”
— DJ Koh, President, Samsung Mobile Communications
Samsung released the Note 7 early to steal the market from the upcoming iPhone 7. Many are hesitant or anxious about Apple’s latest flagship product due to its lack of a headphone jack, and non-mechanical Home button as well as its design which is still too similar to the iPhone 6s. The rush to production of the Note 7 could have led to lapses in design and manufacturing or simply due to a bad batch of batteries. There are now over 70 rumored cases of battery overheating in the US making the threat seem all too real. Analysts now suggest that consumers looking for new phones might go for the iPhone 7 instead, because they’re curious, because of the iPhone 7’s supposed improved battery life, because they won’t get burned and obviously because they have the money.
Then again, how time flies and how quickly people forget. Apple experienced the same thing with the iPhone 5 line. Back in 2014, a student suffered minor burns when her iPhone 5C burned in her back pocket due to a battery malfunction. Early iPhone 5 units were also notorious for battery problems like incredibly short lives, batteries that won’t charge and batteries that inflate and push up the phone’s screens. But like Charlie Sheen, Apple came back winning with their iPhone 6 and 6 Plus. If Samsung moves fast enough and have spin doctors as good as Apple’s, they could too. There are of course other options for consumers like flagship Android devices from Huawei, Asus and LG; and for businesses, there’s HP and Acer’s Windows 10 Mobile offerings.
Right now, Samsung’s Notegate just created a small market vacuum that could enable Apple to sell more iPhone 7 units than the public or pundits expect. Who knows? The ‘courageous’ public might even get to like it, the way they liked Apple products that did away with what used to be ubiquitous components. Or, they can move over to other products and appreciate the finer things in those brands that strive to get the better of Samsung and Apple.