Samsung 'could lose users' after Note7 is scrapped
Samsung has scrapped its flagship Galaxy Note7 smartphone, a day after halting sales because of concerns over consumer safety. The technology giant had delayed the launch of the Note7 in the UK in September as it investigated and replaced faulty units that were overheating and subsequently exploding because of a battery defect.
However, fresh reports in the US raised further concerns that replacement devices were still catching fire, and despite halting production to investigate the issue, the manufacturer has now chosen to completely withdraw the device.
In a statement, the Korean company said: "We can confirm the report that Samsung permanently discontinues the production of Galaxy Note7."
Samsung had halted a replacement programme in the UK after it was suggested that further defects could exist within the Note, beyond the battery issue.
The firm said it had sold around 45,000 Note7s through pre-orders in Europe.
The tech giant had earlier advised retailers to stop selling and exchanging the device while it investigated the cause of the fires, of which at least five had been reported in replacement devices in the US which the company had approved as safe. This followed an initial recall of the device after more than 30 handsets from the original production batch were reported to have caught fire or exploded in the hands of consumers.
There have been no confirmed reports of faults in the UK, where the handset was never fully released, but analysts are already suggesting the recall and now scrapping of the Note7 could cost Samsung in the long run, particularly coming just as rivals including Google and Apple have announced new high-end smartphones.
Richard Windsor, from Edison Investment Research, warned: "As a result of making a complete mess of the Galaxy Note7 recall, Samsung is more likely to lose a large number of high-end users to other Android handsets rather than to Apple.
"The real issue is brand and reputation. As long as Samsung carried out the recall smoothly and kept its users very happy, the issue would eventually blow over.
"Unfortunately, this is very far from the case, and the fact that Samsung appeared to still be shipping defective devices could trigger a large loss of faith in Samsung products."