Consider the impact. What if Apple produced a brand new iPhone that caught fire or blew up in normal use due to a defective battery system? This would be a product defect way beyond Antennagate and Bendgate in impact. It would endanger the safety of tens of millions of customers. Despite all the apologies in the world, Apple would never hear the end of it, and don’t forget all the lame late night jokes about “hot iPhones” that disappeared “in a flash.” It would be relentless.
What’s more, you’d hear about it in the halls of the U.S. Congress, as Tim Cook and other executives were called in to explain the reasons for this abject stupidity or extreme recklessness, this nasty deed that put people in danger. Worse than Volkswagen’s problems with fake diesel emissions ratings, Apple would receive verbal and written tongue-lashings from politicians and pundits alike, maybe even the President.
The stock price? You’d see it fall rapidly, as Wall Street expressed its distrust the company’s future prospects for success.
But that’s the Apple of 2016. Back in the 1990s, Apple planned to use a lithium-ion battery on the PowerBook 5300 series. Amid reports that early production units burst into flame, Apple switched gears and downgraded to nickel metal hydride batteries. My 5300ce had no battery issues, but it was returned to Apple multiple times for repairs of one sort or another, including a problem with the lower screen bezel where an adhesive constantly leaked from it.
That was then. You expect better now with 21st century manufacturing techniques, so the slow rollout of media coverage of Samsung’s very serious battery issues wth the Galaxy Note 7 phablet is especially troubling. Back on September 2, Samsung initiated a voluntary recall of an entire manufacturing run of several million units due to reports of dangerous battery defects. It’s not that the story was ignored, but it was mostly fodder for the business sections of newspapers and online publications.
Then came a published report in a tabloid paper, the New York Post, that a 6-year-old boy in Brooklyn was watching videos on a Galaxy Note 7 when the unit suddenly exploded in his hands. His family had to call 911 to get the medics to rush the child to the hospital, where he’s being treated for burns on his body. I can imagine the lawyers lining up to handle the liability lawsuit against Samsung.
But if the media did the right thing and made a better effort to get the word out about that recall, would that child have even had access to the Galaxy Note 7, or would the announcement have been missed? It’s hard to know.
Without doubt, this is perhaps the worst possible side effect of a defective consumer electronics gadget. The recall decision was reportedly made due to 35 episodes of batteries overheating and catching fire. One of those fires damaged a motor vehicle that was charging the phablet at the time. In the U.S., the Federal Aviation Administration warned passengers not to operate or charge a Galaxy Note 7 on airplanes, and the Consumer Product Safety Commission is said to be working with Samsung on the problem.
It’s not that Samsung is ignoring the public implications of this recall either. According to published reports, the company stated, in response to that child’s injuries:
“We take every report very seriously and have contacted the Lewis family to learn more about their situation. As we are currently looking into this case, we are unable to comment further right now.” I also expect lawyers are lining up to plan class-action lawsuits.
While the story has received coverage, it hasn’t quite taken over the news cycle. Not even close. But things went from bad to worse when the company’s stock price plunged on Monday, 10 days after the recall, costing Samsung $14.3 billion in its market cap. It’s a lot, but Apple has fared far worse for far less.
But this is not a serves ’em right article. I doubt anyone believes that Samsung deliberately paid less attention to quality control when the Galaxy Note 7 was developed. I’ll assume the usual amount of Q&A was performed, and the company clearly had high hopes for sales, with several million reportedly sold before the rug was pulled from under it. It’s just that battery technology isn’t perfect, and even minor unexpected glitches somewhere in the production process may have nasty side effects.
Now you may think Samsung is selling lots of kit, but the early numbers don’t come close to the expected sales of any iPhone. But Samsung’s troubles could boost sales for Apple even further. Still you won’t hear the results of launch weekend sales, at least according to that recent press statement using the excuse that Apple can’t produce enough product to fill demand, implying the sales figures would be unrealistically low.
Or perhaps they knew last year’s totals couldn’t be matched, and there will therefore be no official word about what really happened. On the other hand, there may be some clues when Apple releases its numbers for the September quarter late in October. From there, you can expect unofficial estimates of both iPhone 7 launch weekend sales, along with Apple Watch Series 2 sales.
As to Samsung, I wonder how many people are going to put Galaxy smartphones in their shopping list after this tragic episode. There is likely to be a long-term impact, assuming the press does its duty and continues to pay attention.
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