Test or Replace

When
hover boards hit the market kids and adults were amazed by the latest
technology. Then we experience what technology error looks like when they
started catching on fire? What a disaster that was, right? Now we have a similar
problem with cell phones bursting into flames. Which leads me to Samsung’s Galaxy
Note 7 smartphones catching fire straight in the hands of customers. A woman in
Washington D.C. reported talking on her phone, hearing a sizzling sound in her
ear, followed by her phone catching fire. She reported that the phone burned a
hole in her sheets and almost burned her house down. What a catastrophe that
would have been if she lost her house because her cell phone over heated. That
phone almost destroyed everything she worked so hard for. A father’s car burst
into flames after leaving his Galaxy Note 7 on the charger. Surely, no one plan
on investing in merchandise with features that will randomly explode next to
your ear, in your pocket, in cars or even on-air planes.  This is exactly what Samsung customers got in
exchange for their money. The President of Samsung’s mobile communications
business, Koh Dong-jin, approved the launch of the Galaxy Note 7. Koh Dong-jin
had no idea the phone had major technical problems with its battery, which
almost caused critical injuries to innocent people.

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Due
to the Samsung Galaxy Note 7 technical issues the product ultimately had to be
cancelled and recalled. Although, accidents happen this is one mishap that could
have been avoided. Koh Dong-jin could have prevented this deadly mistake if he
would have subjected the batteries to independent testing prior to launching
the product. To keep up with innovation demands and compete with Apple, Koh
Dong-jin along with Samsung’s innovation team decide to create the Galaxy Note
7. The Galaxy Note 7 was designed to be waterproof and the slimmest device on
the market. To make the phone slim the old “nickel-metal hydride and lead-acid
batteries” were replaced with lithium ion batteries (Wolverton 1). These
lithium-ion batteries are inexpensive and had as much power as a desk top
computer. The lithium-ion batteries were portrayed to be safe because they were
used in so many diverse products on the market. However, these lithium-ion
batteries had adverse effects if they were to get too hot. A major adverse
effect was the batteries overheating and catching “on fire, which increases
heat, which helps the fire to spread and burn even hotter” (Wolverton 1). Troy Wolerton,
editor of The Mercury News, reported that, “preliminary reports indicate the
Note 7’s problems stem from a manufacturing flaw that pushed together the
positive and negative cells of the battery, causing it to overheat.” Instead of
making an executive decision to design a product that would allow 2.5 million
phones slim with removable batteries would have avoided this unfortunate
mishap. Because of Koh Dong-jin made the unethical decision not to test the
lithium-ion batteries prior to releasing the phones to consumers, Samsung was
forced to recall 2.5 million phones and incurred over 5.3 million in repairs.

What
happen to the Samsung Note 7 Phones?

            It’s difficult for companies when
the government is pressing a brand and the consumers are insisting on new inventions.
This forces major corporations to rush modernization and creativity. Also,
there is always a tendency to do things too quickly when companies are striving
to keep up with technology and battle with their competitors to remain on top.
That is exactly what happen with Samsung’s Galaxy Note 7 phones. Exploding
batteries, phones, cars, private property catching on fire and people getting
injured is something no company ever wants to be a part of. The first set of Galaxy
Note 7 phones were reported catching on fire while the phone was connected to
the charger. Despite, the battery being invented to be safeguarded by multiple
fail safes. Fail safes are technology designed to minimize harm to equipment,
the environment and people.  You have the
charger that plugs into the wall and the cable that connects into your phone,
both are fail safe technology. If the charger is defective or if it’s not
designed for that phone it can affect the safety of your phone’s battery and
destroy the circuit. The charger port and the cable work together to protect
the phone and battery from faulty chargers and incorrect electrical flows. The
battery has its own fail-safe system as a last result if the cable and the
charger port fails. On top of the battery is another protection board that
controls the flow of lithium-ions. The fail-safe on top of the battery was
designed to make sure the battery does not overheat. These fail safe protect
the lithium-ions from rapid unforeseen astroscopic disassembly. But if the
temperature so happens to get too hot there are thermal fuses that will blow
inside the battery stopping the battery from catching on fire. The body of the
battery is protected by two greasy layers that allow the phone to charge and
function properly if the battery protectionary circuitry is operating correctly
and the electricity and lithium-ion is regulated. If the protectionary
circuitry isn’t working properly then the lithium-ions will respond violently.

In
the Galaxy Note 7 case, the circuit board at the top of the battery itself was
faulty and failed to do its job properly. This prompted Samsung to hire 700
researchers to test 200,000 phones and 300,000 batteries. What they found were
all the fail-safe connects were good the battery alone caused the phones to
catch on fire. This can be proven because the scorching on the phones occurred only
where the battery was located. The batteries were deformed causing a shortage
in the circuit while the phones were charging. When the phone starts charging
the tiny voltage, regulator could not control the change reaction causing the
fire and overheating of the phone. This were reported to be the issue with more
than 92 smartphones. After the first couple cases were reported the phones were
recalled. Koh Dong-jin made another executive decision to replace the battery
and exchange the phones. This recall took place two weeks after the phone
launched, “on September. Samsung announced a global recall of 2.5 million Galaxy
Note 7 due to faulty batteries which caused some of the phones to catch fire” (Curtis
1). The second battery came from a Chinese manufacture company but they too had
disastrous protection flaws with their fail-safe systems. On October 5th,
the phones with the replacement batteries caught on fire “inside a Southwest
Airline flight in the United States” (Curtis 1). The replacement batteries
failed because the metal impurity in the engineering of the battery were defective.
Releasing pressure within the battery which caused the battery to catch on fire.
The more pressure within the battery the greater the explosion. This only
happen in a very insignificant number of events.

            Nearly 2.5 million phones were
affected in the United States. After 92 cases of the phone overheating, “the
company ceased sales” (Wolverton 1). Then there were 35 cases of people being
burned and 55 cases of property damage to individual cars and garages from the
replacement phones. The federal government started worrying about the dangers of
the lithium-ion batteries that could cause harm to passengers on air planes,
and how the phones were putting innocent people lives in danger if the phone
were to catch on fire. To reduce the risk of this happening the government put
into action a limited ban requiring the phone to be turned off completely and
disconnected from the charger before boarding the plane or train. The
Transportation Secretary Anthony Foxx, released this statement to the public:
“We recognize that banning these phones from airlines will inconvenience some
passengers, but the safety of all those aboard an aircraft must take
priority…even one fire incident inflight poses a high risk of severe personal
injury and puts many lives at risk” (Szczepanski 1). Following this statement,
the airline and subway systems banned the phone completely after the phone with
the replacement battery had smoke coming from it forcing “the evacuation of a
passenger plane in the United States” (Curtis, 1). This prompted Samsung to
give a full refund regardless to when the phone was purchased after only
offering the same phone in exchange for the old phone. Product recall is a
costly process that cost Samsung 5.3 billion dollars. According to Sophie
Curtis, “after reports of fires in replacement devices added to the tech
giant’s worst ever recall crisis.”  The
faulty batteries became so dangerous to the public, phone providers had to take
immediate action and discontinue selling the Galaxy Note 7 in their stores. Top
retailers like AT&T and T-Mobile were two of the main retailers alone with “Australia’s
largest carrier, Telstra Crop” and “South Korea’s two largest mobile carriers,
SK Telecom and KT Corp” also stopped selling the product (Curtis 1).

What
happen to the recalled phones?

Since
the Galaxy Note 7 phones cannot be reused the phones had to be disposed of.
Unfortunately, for the environment more than 500 pounds of raw hazardous material
had to be disposed of as waste. Material like cobalt and neodymium were hard to
get rid of and extremely expensive due to the large amount that had to be
destroyed. Other materials like gold, cadmium and cobalt could safely be disposed
of properly. The Galaxy Note 7 were so sophisticated in technology the device
used more unearthly material than an average smart phone would have. Luckily,
for Mother Nature this could be good for her by bring awareness to “both an
e-waste recycling issue and opportunity” to resolve the issue of not testing
products before lunching them, according to an article written by Waste360
Staff. “The recall of the Note 7 represents an industry-wide wake-up call
that will undoubtedly lead to a more vigorous testing and certification process
moving forward” according to an article by Rizal Reyes. The enormous
amount of lithium-ion battery devices had to be disposed of forcing major
technical manufactures to implement an efficient disassembling plan and policy.
In the meantime, Samsung will use “parts from unopened Galaxy Note 7 phones” in
their new Galaxy Note FE phones (Waste360 Staff 1). This could be a good thing
but the most detrimental part of the phone to the environment, the battery, “is
the primary concern, even for recyclers,” says Mallory Szczepanski. This should
be an eye opener for Samsung and other competing vendors to invest both money
and time to accurately test all devices to dodge this occurrence in the future.

What
Should Have Happen

Once
Samsung became aware of the first instance of the Galaxy Note 7 catching on
fire or overheating they should have immediately recalled the phones. They
should have after first knowledge of the error either exchanged the phone with
a totally different phone that had been tested and the batteries were proven to
be safe. The other option would have been to offer a complete refund to get all
the phones out the hands of consumers and off the market completely. Samsung
reputation could have been tainted due to the default batteries and the danger
it put millions of people lives in. Samsung also could have regained their
customers trust immediately if they would have dealt with the issue promptly
without merit. Samsung tried to brush the situation under the rug by continuing
to promote the device even after the first incident was reported. The best way they
could have approached this issue to recuperate from their brand value
decreasing was to respond quickly and be transparent when resolving the dangerous
defects of the battery to re-claim their consumers trust. Samsung did the total
opposite. Samsung continued to promote the Galaxy Note 7 on social media and
their website after the initial recall. It wasn’t until an actual phone caught
on fire and consumers recorded and posted these alarming events on social media
before Samsung took the product off its website. The fact that they did not
communicate the risks of the handset were bad leadership on Koh Dong-jin part.
Samsung customers will have doubts about the safety of their products because
of the way they communicated this issue to the public. Losing the trust of
their customers is the last outcome Samsung needs. This recall could have damage
Samsung’s reputation. In the end, giving their competitor’s a comparative
advantage over them. As far as, recycling the battery I agree with Szczepanski
that the unused phones should be stored safely “until such time a tested
replacement battery is available and the phone can be put back in service” (1).
The goal would be to reutilize the greatest amount of unsafe material as
possible, preventing a dangerous condition from getting worse. I’m
not sure how much the public will trust Samsung products after this fiery
exposure. But Samsung has put into effect a policy that will make the recycling
part environmentally-friendly. They plan to use the “refurbished phones…
salvageable components will be detached for reuse” and “metal extraction will
be performed using environmentally friendly methods” (Waste360 1). Also,
Samsung should make their phones so that the batteries can be easily replaced
and refurbished. This entire situation could have been avoided if the battery
was detachable, which would have cost the manufacture 4 dollars and the
consumer 10 dollars to replace. Avoiding this simple resolution ended up
costing Samsung millions.

Samsung’s
Financial Fallout

Not
only has Samsung undergone their first financial set back since 2011, but
Samsung market share decreased and they may never get that market share back.
Samsung’s earnings forecasted to be one-third less than what they made the
previous year. Reports show Samsung lost “$2.3 billion off its operating
profit” from the initial recall and “$3.1 billion” from the second and final
recall (Jethro Mullen).
This recall affected Samsung’s brand considering smart phones are so critical
to Samsung’s business. Samsung lost “$9.5 billion in lost sales and put a $5.1
billion dent in profit between September and the end of 2017” (Mullen 1). This
recall also damaged Samsung’s representation. sadly, this is the way people
will recognize Samsung in the market place from this day forward. This will
make it less likely people will purchase smart phones from Samsung.

Can Samsung Recover

            In my opinion, Samsung is a company
with tons of billions of dollars in their cash reserve and they have tons of distinct
parts of their business. But when a leading company face issues where one brand
kills off its entire line of smartphones including one of the popular brands
you know the situation is very serious. But Samsung have the potential to
recovery if Nissan and Ford recovered from their major recall fiasco. Nissan had
a major recall, losing millions of dollars and they still managed to recover
and keep their loyal customers. Johnson and Johnson had poison in one of their
prescription or over-the-counter medications. They made an executive decision
to pull all the medicine off the shelves and the reissue the product. Johnson
and Johnson has even had major law suits filed against them for their baby
powder and vaginal wipes causing ovarian cancer and/or death. Unfortunately, for
consumers this type of incident isn’t the first to occur due to faulty lithium-ion
batteries and it want to be the last. “That’s because the same type of
batteries that powered Samsung’s now-recalled Galaxy Note 7 smartphone are used
far and wide not only in mobile devices, but also in a wide variety of other
products” (Wolverton 1). Currently there is no way to replace lithium-ion. So,
for now we are trapped in a technological triangle, forced to use lithium-ion.
“Researchers have been working on alternative battery technologies and
chemistries, including using aluminum or making batteries that could be printed
or made with the same process used to make computer chips” but this modern
technology is “likely a decade or more away from use in actual products”
(Wolverton 1). Despite Samsung phones catching fire due to these lithium-ion
batteries, Samsung dealt with this disaster appropriately as they saw fit. Fortunately
for them they have a very strong trademark and customers are loyal to trustworthy
brands especially the ones they are used to and trust. It’s extremely hard to
change the minds of loyal customers unless there is a new product or idea that
can change their minds. Samsung took major steps to recover from this incident and
gain their customers trust again by implementing a lot of measures that will
make sure this mistake never happens again. They promised to install an 8.4-billion-dollar
battery safety plan. They also revised their criteria. Finally, Samsung is
employing a team of battery safety experts from outside the firm to insure the
batteries are tested and safe.

Conclusion

Inconclusion,
owning the latest smartphones has been the trending topic for years. As
technology advances the demand to have the best smartphone on the market has
become a challenge for innovators. For Samsung, the Galaxy Note 7 was known as
one of the best smart phones on the market. Unfortunately, the phone will no
longer be known as the greatest smart phones if it is the most dangerous phones
on the market. This mishap created the perfect opportunity for competitors to
sneak in and become one of the best smart phones provider. “While Samsung and
Apple continue to challenge each other at the top, these upcoming players have
delivered value-packed devices that offer consumers top-shelf features at a
fraction of the cost compared to the market leaders” (Reyes 1). The Chinese
companies are making smart phones and they are making them cheaper and just as
fancy as Samsung and Apple but they don’t have the name brand consumers are
formulary with.

The
company’s highest priority should be the customers’ needs and safety. The
Galaxy Note 7 phones catching fire proves Samsung did not take the proper safety
precautions to protect their consumers. Although, Samsung apologized that
doesn’t replace the fact that they put so many lives in danger. This was an
embarrassing setback for Samsung. While Samsung is dealing with their recall
Apple released their latest iPhone and smartwatch. What is so amazing is that
this isn’t the first time a phone has overheated. The difference now is that
Samsung continued to push the launch date and still sold the device in stores
and on websites like Amazon.

What’s
disturbing is Samsung included in the fine print of their contract an
arbitration clause that prohibits the customer from suing them. This means
customers were not able to sue Samsung for damages the Galaxy Note 7 caused to
their property. Inside the Galaxy Note 7 box, under the phone is a smaller box
and inside that box is an additional box that includes the warranty manual.
Three pages to the end of that manual is a clause that states, “all disputes
with Samsung…will be resolved exclusively through final and binding
arbitration, and not by a court or jury” (CBS News 1). Although the consumer
had 30 days to opt-out, the issue is no one ever reads the manual and this
isn’t knowledge the average customer would know. Samsung purposely train their
sales rep to omit information about the arbitration clause and ways to opt-out
the contract. Samsung is following the law by including the contract in their
manual but Samsung intentionally is being unethical and deceitful to avoid
being sued if anything went wrong with their devices. Surprisingly, almost
everything we sign today have an arbitration clause in the contract. Like
Samsung your cable company, car dealership, and even your lease may have an
arbitration clause. Samsung lawyers testified in court that cases against
Samsung should be thrown out because the customers did not opt-out the
contract. An article on CBS News by CBS News Politics states Samsung lawyers
claim that the clause is “conspicuous and consumer friendly.” Customers argued
that they had no idea exactly how they were to opt-out of something they had no
clue that it even existed. Samsung included the clause because, “they feel
really confident that their arbitration provision tucked into that little
booklet underneath the phone is going to hold up in any court law” (CBS News
1). It’s frustrating when something bad happens to you by no fault of your own.
But what’s even more frustrating is when something happens to you by no fault
of you own and the person who caused you the harm will not be held accountable
for their actions. The arbitration clause seems like a get out of jail free
card for vendors. The customers take all the risk when signing a contract with
an arbitration clause. I believe consumers should be required to make the
customer aware of the arbitration clause. By withholding that knowledge leads
me to believe the arbitration clause is only included when the company practice
unethical behaviors. In my opinion, Samsung should be held liable for all
damages the Galaxy Note 7 because they did not think of the best interest of
their customers when they released that phone without testing the battery
first.