Samsung is scrambling to restore its reputation after reports surfaced recently that its freshly released Galaxy Note 7 smart phones pose a fire hazard because of defective batteries. The faulty phones have been quickly recalled but restoring worldwide consumer trust will easier said than done for Samsung.
Numerous Beijingers say they've already turned their back on the South Korean tech giant. CCTV's reporter Martina Fuchs looks at how the recall will affect Samsung's China business and its reputation in the country.
A news wildfire is difficult to extinguish, especially when it involves a global tech goliath.
Samsung Electronics announced the global recall of 2.5 million of its flagship Galaxy Note 7s just two weeks after the smart phones were launched, due to batteries that can catch fire or explode while charging or in normal use.
But, only 18-hundred and 58 Note 7s were recalled in China.
Analysts say that's not due to market bias but because the Note 7s sold in China use batteries different from those in the recalled phones.
Associate VP of IDC China, Antonio Wang, said, "Looking at the short-term, Samsung's problems will offer other phone makers and high-end market players a great opportunity to become more competitive. But for the long run, more attention should be paid to the security of mobile phone batteries. This issue should be taken more seriously."
Chinese online financial magazine Caixin late Sunday cited an internet user's report that his Note 7 phone bought through JD.com had caught fire.The report included photos of the damaged phone. However, Samsung said on its China website without elaborating that its investigation showed that the damage to the phone was caused by external heating.
The Note 7 recall has been Samsung's biggest crisis in recent years. Many airlines have banned the use of the Note 7, saying it's a flight hazard.
Many Beijingers have been paying close attention to the story and say they're leaving Samsung in their rear-view mirrors.
"I use an Apple phone, previously I used Samsung phones but they were very slow and often froze, so I got an iPhone, " said a Beijing resident Wang Ping.
"I have used Samsung and iPhones before. But Samsung phones stop working after like 2 years, the quality is not so good. A friend told me Huawei phones are good so I bought a Huawei one," said a Beijing resident Ivy Ye.
The battery problems could also hijack Samsung's efforts to stage a comeback in China, where it has slipped to No. 6 in a crowded and fiercely competitive market.
Industry data shows that Samsung has lost market share to top performer Huawei, currently in first place with almost 17 percent, and also trails Oppo, Vivo, Apple and Xiaomi.
"Samsung’s share in China - the world’s largest consumer market - has been shrinking as local competitors offer cheaper Android phones but smart phones remain a key business for the company. Samsung last year shipped almost 325 million handsets to China," Martina Fuchs said.
