Samsung to replace or refund million US Galaxy Note 7 phones

Samsung has recalled one million Galaxy Note 7 smartphones sold in the United States, replacing or refunding the flagship phones, whose susceptibility to catching fire has damaged the image of the Korean company.

Samsung received 92 reports of batteries overheating in the US, including 26 reports of burns and 55 cases of property damage, the company said as it announced the recall in co-operation with the US Consumer Product Safety Commission (CPSC).

Costly setback

The recall is a costly setback for Samsung, which was counting on Galaxy Note 7 to bolster sales as rivals such as Apple launch new devices. The scale of the recall is unprecedented for Samsung, the world's largest smartphone maker.

Samsung said on Thursday that new Note 7 replacement devices would be available at most retail locations in the US no later than September 21st.

Earlier this month, Samsung said it would recall all Note 7 smartphones equipped with batteries it found to be fire-prone and halted their sales in 10 markets, denting a revival of the firm’s mobile business.

CPSC chairman Elliot Kaye said companies should not try to do a recall alone.

“Anybody who thinks that a company going out on its own is going to provide the best recall for that company, and more importantly for the consumer, needs to have more than their phone checked,” he said.

Blow to reputation

While recalls in the smartphone industry do happen, including for rival Apple, the nature of the problem for the Note 7 is a serious blow to Samsung’s reputation, analysts have said.

The CPSC said on Thursday that consumers should immediately power down and stop using the recalled Galaxy Note 7 devices.

Some 2.5 million of the premium devices worldwide need to be recalled, Samsung said. Some analysts say the recall could cost Samsung nearly $5 billion in lost revenue this year.

The US Federal Aviation Administration said on Thursday that air travellers must keep the recalled phones off and unplugged during flights, formalising a recommendation it had made last week to passengers. – (Bloomberg)