Samsung on Tuesday, October 11, pulled the plug on its Galaxy Note 7 smartphone amid continued complaints of explosion in the phablet.
This means it will not only stop manufacturing the phone but also pull all Galaxy Note 7 pieces off the shelves. However, there seems to be some ambiguity on what will happen to the phones that have already been sold and are currently in use.
Experts believe the move to scrap the phone was propelled by the understanding that there had been enough blow back from the smartphone and the incidents surrounding it, and things could get much worse if there was any loss of life due to the phone.
The decision could cost the company both in cash and kind, because the phone had been released barely two months ago. Also, Samsung's hitherto image of a company that builds "safe" phones will also take a hit, given how even replacements to faulty original Galaxy Note 7 phones exploded.
"(We) have decided to halt production and sales of the Galaxy Note 7 in order to consider our consumers' safety first and foremost," Reuters quoted the South Korea-based firm as saying in a filing to the Seoul stock exchange.
Samsung's decision to pull Note 7 off the shelves not only raises fresh doubts about the firm's quality control but could result in huge financial and reputational costs. Analysts say a permanent end to Note 7 sales could cost Samsung up to $17 billion and tarnish its other phone products in the minds of consumers and carriers.
Meanwhile, Samsung shares have been falling heavily in the wake of the the company's earlier decisions surrounding the phone. The company is now believed to be gearing up to launch the flagship Galaxy S8 smartphone in February next year, possibly in a bid to douse the flames of the Note 7 controversy.
(With inputs from Reuters)