Apple iPhone 7 at an advantage as Samsung decides to recall Note 7

Tim Cook-led Apple just might have the last laugh this time with its launch of its next generation of iPhones -- iPhone7 -- as Korean electronics giant Samsung on Friday decided to suspend production of its 'faulty batteries that were exploding' and announced a global callback of its latest Android flagship device -- Galaxy Note 7.

"Apple is just about to launch its next generation of iPhones and hence Samsung's recall will put it at a disadvantage. More so because the company had deliberately launched ahead of Apple to get new users who were waiting for iPhones. They were successful to a point but the recall is going to have a negative impact on the phone's impression," senior analyst, Counterpoint Research, told HT adding that this was the first of its kind recall for a smartphone brand.

He also explained that people would rather buy a iPhone for the same price of a 'tainted imaged' Note 7.

Samsung's announcement on Friday comes just over two weeks since the premium device's launch, and follows reports of the 988,900 won ($885) phone igniting while charging. Koh Dong-jin, head of the South Korean company's smartphone business, who declined to comment on the number of phones needing replacement, said Samsung had sold 2.5 million of the premium devices so far. The manufacturer plans to replace not only phones with faulty batteries sold to consumers, but also retailer inventories and units in transit.

"I can't comment on exactly how much the cost will be, but it pains my heart that it will be such a big number," he said.

Faisal Kawoosa, semiconductor and electronics analyst at CyberMedia Research (CMR), also said that the phones might get delayed in India where the company had only taken pre-orders. "It will at least take them 20 days or more to come back with the products and if Apple can launch close to them, then their sales will definitely take a hit," he explained.

Pathak and Kawoosa both said that it will be really difficult for the brand to recreate the same image of the phone and assure consumers of its safety. "Right now they have to somehow ensure quality assurance of the device to customers," Pathak said.

However, Samsung seems to be confident of a speedy comeback. "We don't think it is going to affect us much as Samsung has always delivered on its promise. We should be able to sell phones in India and globally by 20 days," a company source, in the know of things, said.

A Samsung India spokesperson also said that "it is committed to producing the highest quality products and we take every incident report from our valued customers very seriously. In response to recently reported cases of the new Galaxy Note7, we conducted a thorough investigation and found a battery cell issue."

"To date (as of September 1) there have been 35 cases that have been reported globally and we are currently conducting a thorough inspection with our suppliers to identify possible affected batteries in the market. However, because our customers' safety is an absolute priority at Samsung, we have delayed sales of the Galaxy Note7 in India," he added.

Samsung had launched the Galaxy Note7 last month in India at a price tag of ₹59,900. The device was to be made available in the Indian market from Friday.