Samsung tries not to repeat Sony debacle
Tech giant vies to shake off battery crisis
Samsung Electronics is stepping up its efforts to prevent a recurrence of Sony’s nightmarish battery fiasco back in the mid-2000s.
The Tokyo-based electronics giant was the world’s leading premium appliance maker until 2006, when 4 million Dell laptops were recalled for “exploding batteries” supplied by Sony.
At the time, Sony was unmatched in areas such as imaging technologies used for TVs and cameras.
No one believed Samsung could take Sony’s limelight, as the Korean company was not widely recognized at major tradeshows such as the Consumer Electronics Show in Las Vegas or CeBIT tech expo in Germany.
But Sony began to lose its luster after the unprecedented laptop recall, and Samsung has been the world’s No. 1 premium TV manufacturer for more than a decade.
The world’s largest smartphone vendor by sales, however, suffered an unexpected setback last year, with its flagship Galaxy Note 7 embroiled in similar controversy over faulty batteries.
But the Seoul-based company proved to be more agile in dealing with the aftermath of the fiasco by instantly stopping production and sales of the problematic device and offering refunds for an estimated 1 million Note 7 users.
A notable difference in crisis management at Samsung and Sony is the former’s efforts to regain customer trust by promptly unveiling the root cause for the Note 7 disaster, observers said. The firm also pledged to prevent future incidents in new models.
“Samsung will not claim any legal responsibility against our battery suppliers, as we ultimately failed to cross-check the safety of the devices,” Samsung Electronics’ mobile chief Koh Dong-jin said in a press conference in January.
At that time, the company unveiled its multilayer safety inspection measures from the initial development stage.
The swift countermeasure has helped win back customer trust, as shown by sales of its Galaxy S8 smartphone, which set a firm record for prior orders of more than 1 million. In contrast to Sony, it took less than a year for Samsung’s mobile unit to return to profitability after the debacle in the third quarter of last year.
Earlier this month, the company reported in a preliminary earning guidance report that its second-quarter operating profit is estimated to top 14 trillion won ($12 billion), driven by its semiconductor division. This is the largest since it was founded in 1969.
The company plans to unveil its divisional profit later this week, but observers point out that its mobile unit has also added to the unprecedented profitability with robust S8 sales.
The earnings estimate made global headlines, as this is expected to mark the first time the Seoul-based company will beat Apple as the world’s most profitable firm.
Samsung Electronics plans to unveil its large-screen flagship Note device next month in New York, raising expectations that it will continue its winning streak in the latter half of the year. The Note series is securing fans as the world’s most premium Android handset available.