Samsung decides to completely stop the sales of their Note 7 flagship device. This will have great implications for the company, and we are sure that many competitors will use their misfortune to get a larger portion of the market and sway more buyers to their brand.
Just recently we have received info from Samsung that they will cease the production of their flagship. We are very surprised, and more than that, we are also quite disappointed. Galaxy Note 7, device that should be one of the most powerful ever and the one that could rival and beat currently, pretty much, undisputed iPhone is out of the game. On top of that, there are no details about the return and when it could come back to the market.
Production and deliveries are stopped, and that might not be even the biggest problem for the company. They are losing money, their stocks are down 8% even before the production cease announcement, and we expect it to fall further. About $18 billion has been lost with this drop and it is a good question where it will stop. We all remember Nokia and how quickly they lost market and sale numbers that dwindled. What might be the even bigger problem for South Korean tech giant is the fact that people might lose confidence in their products as they become concerned about the safety.
Everything started when few devices exploded in August by itself. As soon as this issue occurred tech giant began the search for the cause of smartphone misbehave. A huge number of engineers and staff were looking for a solution, and initial reports suggested that amount of mAh in tiny battery pack was the reason.
During September Samsung recalled its smartphones and new units were shipped but this time with battery packs that were delivered by the different company. Not long after that problem resurfaced and reports about new devices turning into a smokey pile of rubbish were again all over the Internet and accompanied with a decent number of photos and videos of these things happening.
This is not the first time for Samsung that they are in trouble, but it seems that this is the biggest one so far. Other manufacturers also had defective devices, we can remember iPhone that was losing signal if not held properly, but all those were on the much lower scale. This caused the complete stop of deliveries and it is very hard to guess the total number of units that are problematic. What we do know is that on Sept. 2, Samsung issued a recall for 2.5 million Note 7s that were offered with SDI batteries and replaced them with ATL powered units. This did not have an effect, and the problem returned.
The company decided to test their devices after first reports of problems but even that didn’t bring the solution. They were simply unable to cause the device to fail during tests, and the only solution was to stop everything and find the answer. We will keep at least one eye on this and wait to see the next move of Samsung.
