The review units of Samsung's foldable phone are breaking, and it is a possible fiasco that threatens the fragile reputation of the company, Business Insider



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The Samsung Galaxy Fold.

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The Samsung Galaxy Fold.
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Hollis Johnson / Business Insider
  • Multiple journalists say their first review units of the new Samsung Galaxy Fold were broken a few days after receiving them.
  • The buzzy device is expected to be the first folding smartphone from a major manufacturer when it's officially released next week – though experts we're talking to say that it would not be crazy for Samsung to postpone the launch.
  • But if the hardware issue is widespread, it can be a nightmare for the company and highlights the risks of rushing to be the first.
  • And it comes just a few years after the Galaxy Note 7 fiasco, in which some of Samsung's top smartphones overheated and caught fire, and had to be discontinued.

Several journalists are reporting that their review copies of Samsung's new foldable phone have had catastrophic failures just a week before the official launch – a possible fiasco that threatens the company's fragile reputation.

On Wednesday, several tech reporters have gone to Twitter to raise concerns about the Galaxy Fold screen, a highly anticipated device that should be the first great foldable screen smartphone when it goes on sale to consumers on April 26.

A video posted by CNBC technology editor Steve Kovach showed the left side of the screen in the evaluation unit of the faulty socket "after a day of use." Mark Gurman of Bloomberg also posted photos of the screen progressively deteriorating to a state of utter worthlessness, writing: "The screen of my Galaxy Fold review unit is completely broken and unusable just two days later."

Dieter Bohn of The Verge reported that a mysterious bulge had appeared on the screen of his review unit, and Marques Brownlee, a popular review of YouTube gadgets, also reported having screen problems.

While it is not yet clear how widespread the problem is, the fact that four of them have already been broken after only two days of normal use is not a good sign for the device's outlook. Some Background Mathematics: Assuming that about 1,000 review units were sent to reporters, this suggests a failure rate of approximately 0.4% in just two days. This is clearly unacceptable for any consumer product – let alone a next-generation smartphone sold for $ 1,980.

And the potential crisis is especially acute for Samsung, as the company has only recently recovered from another smartphone crisis. The Samsung Galaxy Note 7 was a nightmare for the company in 2016, with device batteries overheating, catching fire and exploding, causing a global recall and ultimately a complete cancellation of the entire product.

The company has worked hard to rebuild its reputation in subsequent years, and another major flaw of a flagship device could seriously undermine its status as a manufacturer of premium high-end handsets.

"If Samsung's flagship phone, at an unprecedented price, is breaking at a high rate, Samsung will have to postpone the launch," Avi Greengart, Techsponential analyst, told Business Insider. "After the disastrous battery problems of note 7 – and Samsung's poor initial response – I hope the company has better procedures to deal with production problems."

So, what is happening?

There seem to be some different problems occurring.

There is a thin layer of plastic on the screen that looks like a discard screen protector. Both Gurman and Brownlee says they removed it, possibly contributing to their problems.

Yet, Kovach wrote on Twitter that CNBC did not remove the film, but that the screen on your device broke anyway. And the Bohn question, the bulge, seems to be completely different, with a cause still unknown. He too did not remove the movie for registration.

All of this suggests several points of failure for the device, rather than a single problem, potentially making it difficult to fix.

It is worth noting here that some review units from other reporters are fine. Business Insider's Lisa Eadicicco tested the Galaxy Fold and found no problems, while Geoffrey Fowler, of the Washington Post, did an impromptu stress test, opening and closing 100 times at a time, and found no problem. This is not to say that these devices could not work later, of course. Only two days ago, after all.

It looks really bad. But we must exercise some caution.

Samsung has not yet commented publicly on the issues, and it is prudent not to jump to conclusions.

"The most important thing to do now is get the facts. There is a chance that the first batch of drives will have some problems and the rest will be fine, "said Moor Insights & Strategy technology analyst Patrick Moorhead.

"Once the root cause has been established, you go from there … If it's a small batch problem, the inventory is likely to be tested. If it's a general design issue, it would take some time to remedy."

He added: "How Samsung handles the situation will determine the impact of the brand."

In other words, the review devices provided to journalists may not be truly representative of the finished product, meaning that the devices that are offered for sale to consumers can be trouble-free. But if that's not the case, it's up to Samsung to fix things to avoid another reputation disaster. Samsung was strongly criticized for its initial response to the issues in Note 7; if you make similar mistakes again, this will suggest that the company has not learned from its mistakes and is likely to exacerbate the crisis.

At a minimum, Samsung will probably need to provide additional guidance to ensure consumers also do not remove the layer of film – warnings printed on the box and instructions to sellers, "Greengart suggests. If professional technology analysts are making that mistake, then consumers certainly will.

Even if the device is finally in an acceptable state for sale, the launch target planned next week seems uncertain. "I do not see Samsung launching (sending to consumers) until the root cause is determined," Moorhead wrote.

Greengart added: "I am sure that Samsung is destroying the damaged review units and seeing if there is a common point of failure. However, if Samsung's flagship cell phone at an unprecedented price is breaking at a high rate, Samsung will have to postpone the launch. "

That said, if Samsung successfully repairs the device before launch – even if it means postponing that deployment – long-term damage to the business can be minimal.

"The bad press is bad press, and that's unfortunate, and nobody wants it," said Stephen Beck, founder of cg42 consultancy. "But at the end of the day, consumers are usually very tolerant if the company … does the right thing for them."

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