Samsung Galaxy Note 7 Closes Production Effective Today, Project Termed As ‘A Horrible Failure’

With the cancellation of the Galaxy Note 7, not only will Samsung have to address the cost of recalling and disposing million of handsets, but it will have to rebuild the company’s brand name in the smartphone space. That onerous task will fall on next year’s Galaxy S8.

As many industry watchers expected, and as South Korean executives perhaps feared, the Samsung Galaxy Note 7 was cancelled on Tuesday. The fix that Samsung put in place for the exploding batteries in its critically acclaimed phablet did not solved the issue and replacement units continued to catch fire. The South Korean company looked into the issue, and the decision has been made to stop production completely. The Note 7 is no more. It is an ex-Note.

A single sentence from a Samsung spokesperson has confirmed its fate, “We can confirm the report that Samsung has permanently discontinued the production of the Galaxy Note 7.”

Samsung’s mobile division will have to be brutally honest with itself. Not only were there failings in the design process, but failings in quality control both of the initial handset and the fix that was put in place. Management needs to look at the response to the initial reports, how the replacement program was rolled out and why the fix was not a genuine fix.

But there’s another group inside Samsung that is going to feel a different kind of pressure. The team behind next year’s Samsung Galaxy S8 project was already expected to deliver a smartphone that would rival the iPhone 7 and be sufficiently advanced enough to challenge the iPhone 8. Now that same handset has the future health of Samsung’s entire mobile division on its digital shoulders.

As we all know by now, Samsung is going to have an ugly quarter. Its share price is already down eight percent on the Note 7 news, it is going to incur significant charges to recall the millions of devices and the cost of their disposal, it has lost one of the biggest selling smartphones as the festive season approaches.

The launch of any flagship is critical to a company’s success. In the case of the Galaxy S8 it is more than critical to the company’s success, it is critical to the existence of the company.