Tuesday 23 January 2018

'Exploding phones won't return to Irish shelves' - Samsung boss personally collected Note 7 phones in airport on day of global recall


Conor Pierce says Samsung has overtaken Apple for premium sales which account for two-thirds of the market. Photo: Adrian Weckler
Conor Pierce says Samsung has overtaken Apple for premium sales which account for two-thirds of the market. Photo: Adrian Weckler
Adrian Weckler

Adrian Weckler

'It's highly unlikely to happen." Conor Pierce is ready for the question: will Samsung sell refurbished Note 7 phones in Ireland?

Privately, the company's UK and Ireland boss must be a little dismayed at reports that the company intends to press ahead with sales of returned, refurbished Note 7 devices in some markets. The exploding phone, which is still on airlines' banned lists, has already done significant damage to Samsung's brand worldwide.

But when asked about it, Pierce seems pretty adamant. "No, we have no plans to do that in Ireland," he says.

Pierce has earned the right to say this. He was there during the crisis recall, giving out Samsung S7 Edge phones to Note 7 owners in public spaces. "I was in the airport on the day that we had to do our recall, collecting phones from people," he says.

"We set up kiosks there so people could swap them. Because otherwise the phone was going to be confiscated [by the airline]. What were people supposed to do, miss their flight? Or lose their phones? So we said 'we'll take your phone off you, here's an S7 Edge, we'll transfer all your stuff onto it', so they would have something to get on the plane with. We had a task force set up from first thing in the morning until last thing at night."

As customer service goes, it was a fairly commendable bit of improvisation. But Pierce has had a career disciplined by such attention to detail. Formerly a senior European executive at Nokia, the Dubliner joined Samsung in 2015 as a vice-president for the UK and Ireland with responsibility for Samsung phones, wearables, accessories, tablets and Samsung's IOT Smart Things business.

Right now, he's glowing in the aftermath of a successful (and controversy-free) Galaxy S8 launch and a fairly stellar set of quarterly results showing record profits.

But for many punters, Samsung is also still seeing off one of the biggest missteps in recent mobile history, the launch of a phone with a battery that sometimes caught fire.

Read more: Samsung factory that made 'exploding' Note 7 batteries catches fire

"It was devastating and very humbling for Samsung," says Pierce. "But we've learned a lot from it." But isn't it frustrating that just as Samsung tastes renewed success with the S8, it resurrects the corpse of the Note 7 through this plan to sell refurbished models? Why do that at all?

"I suppose there were a significant volume of Note 7s which had been returned and refurbished," says Pierce. "We have to be respectful to the Note user base which is very loyal to Samsung. Each region can make their own decisions on this, but it's not something that we're taking on in Europe."

Pierce says that there remain a few holdouts that simply refuse to give their Note 7 devices back. This reporter can empathise. As reviewed in these pages last October, the Note 7 was one of the best handsets ever to cross our desks (and in our view, a step up from Samsung's sister 'S' devices).

But even if we won't be seeing the Note 7 back on Irish shop shelves, the company has an interesting alternative in its new S8 and S8 Plus.

It's not just that the two phones squeeze in much larger screens, (5.8 inches and 6.2 inches) without any increase in the overall size of the device - it's the way that the S8 is preparing the ground to replace laptops and PCs.

One of the accessories for the S8 is Dex, a dock that turns any monitor into a fully functional PC. It means that anyone who buys this new phone barely needs a separate PC anymore, unless they have specialist requirements.

"The boundaries are definitely being blurred," says Pierce. "Some may want a high-powered computer. But ultimately this snaps into place and suddenly you're making your phone into a desktop. And with all the cloud tech that's there, you can pull down whatever you want whenever you want. So the idea of lugging around a laptop or a tablet may be different now."

Even without the dock, which will cost around €150, the larger screen on the S8 devices could be a game-changer in itself. Phones are far and away the fastest-growing screen category in video consumption - and not just for Facebook and YouTube.

Netflix now says that the majority of its movie and TV streams in markets such as India are now on smartphones. Given that a 6.2-inch screen is about a third larger than a standard 5-inch phone screen, it's hard to see how Samsung won't accelerate the trend of TV and computing switching over to handsets.

Right now, the device is still at a pre-order stage in Ireland, but will sell for €799 (S8) and €899 (S8 Plus) when available at the end of the month.

"The Irish market is in a very different place to what it was last year," says Pierce. "Samsung is in a much stronger position in terms of our premium market share. About 68pc of the value of the market is premium, meaning anything priced over €600. It's a two-horse race between ourselves and Apple."

Read more: Samsung set to remove headphone jack on Galaxy S8

Pierce says that Samsung has overtaken Apple in premium handset sales in Ireland, a claim that is difficult to verify.

He also says that there's a growing trend towards sim-only phone contracts with handsets purchased separately.

"That's not a particularly healthy trend from our point of view and from the networks' point of view," he says. "But people are looking for more control, so the second-hand device market is growing too."

What Pierce may mean is that decoupling the network plan with the handset subsidy challenges the top two brands a bit more. To offer further incentives for people to stick to the 24-month contract model, Pierce says the Samsung now has an upgrade program.

"If you have a 24-month contract with the S8, in 12 months' time we'll take the S8 off you and give you whatever the next flagship device is, no questions asked. That's really attractive to people."

It also keeps people in the Samsung ecosystem.

But this year hasn't all been about smartphones. The surprise hit of Mobile World Congress, the world's biggest phone show, was Nokia's humble 3310 button-phone. For Pierce, who a senior executive in Nokia for 12 years, it's a blast from the past.

"Amazing isn't it? What a nostalgic moment that was. I'm just not sure if nostalgia sells much. Because when you look at it, 84pc of 16-to 24-year-olds in Ireland use Snapchat. It may have a brilliant battery that goes on for weeks, but it might just be a festival phone."

Pierce is no more willing to give Microsoft Windows phones a chance than the old Nokia systems. Samsung no longer makes any Windows devices.

"Sorry, no," he says. "I've been down that road once before."

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