Samsung's Note 7 has created a deep scar for what appeared to be a picture perfect scenario

But even with the best design from Samsung in decades, Samsung was in a rush to deliver its flagship product for the year before Apple and LG and this has resulted in a massacre of the brand with a loss of epic proportions.


It was the smartphone Galaxy Note fans had been waiting for. One that was supposed to pack in the best that Samsung had on offer along with some features that no other manufacturer could come up with. It even featured a not-so-popular iris scanner that Samsung advertised about apart from its water resistant capabilities. But even with the best design from Samsung in a decade, Samsung was in a rush to deliver its flagship product for the year before Apple and LG. Rushing your product in stores comes with some drawbacks as devices usually do not get enough time in the testing phase. And all of this (along with some bad PR) has resulted in the massacre of the Samsung brand.

We had a chat with Sanchit Vir Gogia, CEO of Greyhound Research. While the CEO commented on how Samsung seems to have done nothing to bring back the faith of its customers into their products, he also pointed out the losses. “The real impact of Samsung’s Note 7 mess up will be visible in the next 3-4 quarters. This will not die in just the next quarter. The brand has been impacted in a very huge way. Samsung should only expect a modest outcome from their upcoming smartphone announcements. Samsung has already lost 16 billion dollars in this mess and you could probably add an equal amount in terms of sales.”

That's not a small amount by any means as that is just the beginning. Forbes estimated a cost of around $900 billion but that was just for the first wave. As mentioned in a previous article, even one single product fail can lead to a domino effect. Business Standard points out how shares of Samsung Electronics have touched a one month low after the electronics giant announced that it had permanently halted sales of the problematic smartphone. Shares dropped by 2.9 per cent and the same will have an impact on the company's quarterly earnings as well.

Image: Hui Renjie

Image: Hui Renjie

Reuters quoted Edward Snyder, the managing director of Charter Equity Research who hinted that the Note brand could be ditched entirely. "By the time they fix the problem they have to go through recertification and requalification and by the time that happens, they're going up against the (Galaxy) S8 launch."

So far Samsung has yet to cancel out on its next product launch, which would be the Galaxy S8 flagship. The launch that is expected to happen at next year's MWC will be vital for Samsung to keep up its quarterly targets.

Taking down its Note brand would be a tough decision of Samsung, since it built this segment from scratch in a time when Apple was building iPhones with 3.5-inch displays. In the post Steve Jobs era, current Apple CEO Tim Cook allowed for a bigger smartphone with the 6 Plus models and Samsung's loss this year, may indeed turn out to be Apple's gain. Apple iPhone 7 models launched soon after the Samsung Note 7 models, is good news for Apple, since its Plus model this year packs in a dual camera sensor that offers something more in terms of imaging. Apart from this, Apple's iPhone 7 models are also IP67 dust and water-resistant and come with dual speakers as well. Looks like Samsung's loss is paving the way for others to step into its segment and this is a really tight spot to be in.


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