Samsung Finally Pulls the Plug on Note7 but After a Great Cost to Many
NEWS ANALYSIS: After a series of poorly managed recalls and supply chain problems, Samsung starts to permanently get rid of the dangerous devices, but the cost to all involved is significant.It wasn't supposed to be this way. When Samsung introduced the Galaxy Note7 back in August, this new smartphone was intended to give the Korean giant a head start on the much anticipated iPhone 7 that was due out the following month. Instead, the Note7 became the definition of a product that should never have been brought to market in the form that it took. For the first time in history, airlines specifically warned their passengers against using the phone on board and television news crews flocked to reports of exploding devices. And now Samsung is permanently stopping production of the Note7 thanks to too many reports of exploding batteries. Exactly how this happened is still conjecture. Was Samsung in too much of a rush to beat Apple that it failed to test its devices properly? Did the urge to contain costs mean that Samsung's supply chain introduced defective materials? Was it some of both? Regardless of how it came to be, the Samsung Galaxy Note7 has become a story so seared in the memory of everyone involved with mobile technology that it's sure to tarnish the company's reputation, much as Apple's problems with the iPhone 4 antenna followed it for years. For Samsung, the question has now become how to recover without losing too much business.
What's already happened is that the Note7's portion of Samsung's mobile phone business is gone. Fortunately for Samsung, the Note7 was not the core of the company's business. The phones that are the core of Samsung's phone business, which include the Galaxy S7 and the Galaxy S7 Edge along with several smartphones that are less expensive but still significant, are still being sold. While Samsung's reputation may be hurt, it's not in danger of going out of business.