Monday 24 October 2016

Samsung pulls plug on €10bn disaster

Thousands to get refunds in Ireland as phone maker scraps troubled Note7

Published 12/10/2016 | 02:30

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Thousands of Irish mobile phone users are in line for a refund after Samsung finally pulled the plug on its disastrous Note7 smartphone.

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The handset, which has been scrapped after two recalls and a series of explosions, will now be written off as a €10bn disaster by the world's biggest smartphone maker.

Samsung is warning anyone with the Note7 phone to immediately turn it off in case it catches fire or causes injury.

A spokeswoman for Ireland's biggest operator, Vodafone, said that customers who purchased a Note7 can get a refund whether in or out of a contract.

She said that if a customer took out a new contract with the purchase of a Note7, that contract may now be cancelled if the customer wishes.

For those who got a Note7 on an upgrade with a contract extension, Vodafone will cancel the contract extension period at the customer's request.

Apple is expected to be the big winner from the Samsung Note7 meltdown. Photo by Adisorn Chabsungnuen/Pacific Press/LightRocket via Getty Images
Apple is expected to be the big winner from the Samsung Note7 meltdown. Photo by Adisorn Chabsungnuen/Pacific Press/LightRocket via Getty Images

A spokeswoman for 3 Ireland said that it will operate on a similar basis.

There are estimated to be no more than 2,000 people in Ireland who purchased Note7 devices. Mobile operators sold the device chiefly on a pre-registration basis, as the first recall occurred before the phone went on general sale in shops here.

However, there are an unknown number of people who bought the phone overseas or online. Those people will likely face longer waits for refunds.

There have been no reports of similar safety hazards affecting Samsung's S7 or S7 Edge models, which are the company's biggest-selling products.

Samsung took the decision to halt production of the Note7 smartphone after further incidents of overheating and fires associated with the device were unearthed around the world.

Read more: Flight evacuated after 'replacement' Samsung Galaxy Note 7 catches fire

The company told regulators that it won't resume production of the phone and has advised operators to cease selling it. The move is likely to cost the company more than €10bn, with 19 million sales of the device previously forecast. Roughly half of Samsung's revenue and profits comes from mobile devices.

"[We] have decided to halt production and sales of the Galaxy Note7 in order to consider our consumers' safety first and foremost," the South Korean firm said in a filing to the Seoul stock exchange.

Samsung said earlier it asked all global carriers to stop sales of the Note7 and the exchange of original devices for replacements, while it worked with regulators to investigate the problem. The company is offering to exchange Note7s for other products or a refund.

Investors wiped nearly €20bn off the market value of Samsung Electronics yesterday as its shares closed down 8pc, their biggest daily percentage decline since 2008.

Apple is expected to be the big winner in Samsung's Note7 meltdown, with sales of the iPhone 7 set to gain from the Note7's demise.

Irish Independent

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