Samsung Note 7 Fires Caused By Batteries, New Phone Launch May Be Delayed
The company has pledged to improve product safety in wake of smartphone fires
Samsung has indicated that the launch of the latest model in its Galaxy S smartphone line may be delayed as it works to improve the safety of its devices after completing an investigation into what caused many of its Note 7 phones to explode or catch fire.
Upon finishing the investigation, the company concluded that faulty batteries provided by two different suppliers were the cause of the fires that Reuters reports "wiped $5.3 billion off its operating profit."
According to Samsung Mobile Chief Koh Dong-jin, the company has put procedures into place to prevent the fires from happening again as it gets ready to launch the Galaxy S8 model.
"The lessons of this incident are deeply reflected in our culture and process," Koh told reporters at a press briefing. "Samsung Electronics will be working hard to regain consumer trust."
Devices in the Galaxy S series have been traditionally launched at Barcelona's Mobile World Congress trade show, which starts on February 27 this year. However, Koh stated that the S8 model will not be unveiled there this year, nor did he provide any specifics for when the device will be launched. However, analysts expect that the S8 will go on sale by April.
Samsung investors have said that the company needs to reassure customers that it can be trusted to fix the Note 7 problem and prevent it from happening again.
The company's reputation was hit hard after it recalled the devices initially, only to find that the replacement devices it provided also caught fire. Images of melted devices spread across social media networks and travelers were banned from even taking them on board a flight.
The recall of the Note 7 less than two months after it was launched is considered one of the biggest failures in the history of tech.
The company has not yet decided whether it will reuse parts from returned Note 7s or resell any of the recalled devices. It said that it has received 96 percent of the 3.06 million devices originally sold.
The Note 7's hardware and software were ruled out as potential causes of the fires by internal and independent experts in their investigations. They found instead that the devices' batteries—which came from two separate suppliers—had different manufacturing defects or flaws in their designs that caused them to short circuit.
"The odds that two different suppliers had issue with the same phone is an extremely low likelihood and may signal we have reached an inflection point in smartphone battery technology," said Patrick Moorhead, president of technology analyst and advisory firm Moor Insights & Strategy.
Samsung has previously identified its suppliers as affiliate Samsung SDI Co. and Amperex Technology. SDI has committed to invest $129 million in improving the safety of its products and expects to continue as a battery supplier for Samsung phones.
Samsung said that it accepted responsibility for the incidents and would not be taking legal action against its suppliers. It has taken several measures to improve product safety, one of which is an eight-point system for checking the battery. This system is meant to make sure that any similar problems will be noticed in the future.
Industry experts are still cautious about sales numbers for future Galaxy S devices.
"Consumers will accept the results (of the probe) only if there are no problems with the S8," said Park Chul-wan, former director of the Korea Electronics Technology Institute's Centre for Advanced Batteries.