(Update: recall to be announced soon) Reports: Samsung considering Note 7 recall, battery pack to blame

Update: An unnamed Samsung official confirmed to Yonhap that a recall will take place. The announcement could happen as soon as this weekend or early next week, but Samsung is reportedly still working on a solution to the crisis. The report also gives us an idea of the size of the problem:

“The most important thing is the safety of our customers and we don’t want to disappoint our loyal customers.”

“Products installed with the problematic battery account for less than 0.1 percent of the entire volume sold. The problem can be simply resolved by changing the battery, but we’ll come up with convincing measures for our consumers,” said the official.

It looks like the problem is global. Samsung is said to be in talks to Verizon and other global business about the measures that need to be taken.

Original post: Reports out of South Korea paint a dire image for Samsung, as the Korean giant is grappling with hardware issues that forced it to halt shipments of the Note 7 in the Korean market.

Yesterday, Samsung announced that it had stopped Note 7 shipments to Korean carriers in order to conduct “quality tests.” The company did not confirm or deny reports that tied the halt with incidents where Note 7 units caught fire or even exploded.

In spite of Samsung’s silence, it looks like the explosion reports are indeed the reason Note 7 shipments are on hold. An unnamed company official cited by Korea Times acknowledged that Samsung has stopped shipments because of the incidents:

“We have acquired the handsets, which our customers say burst into flames while charging to identify the reason. We will come up with a fix as soon as the investigation is finished. We suspended the supply of the phones earlier this week so as to double-check their safety.”

Battery pack issues?

In a different report, Korea Herald states, without mentioning any source at all, that Samsung is considering a recall of all the units it shipped so far, though it’s not clear if that means an international recall or one that is limited to certain markets. If the recall goes through, Samsung will replace the battery free of charge.

According to the same report, the problem may be related to the battery pack, and not the battery cells that make the pack up. The cells are manufactured by Samsung SDI, but the company outsources battery pack manufacturing to various suppliers. Explosions have been reported on the phones equipped with battery packs made by Korean supplier ITM Semiconductor, says Korea Herald.

Samsung SDI said in a statement to Reuters that “it had received no information to suggest the [Note 7] batteries were faulty.” Even so, its share value plummeted by almost seven percent today.

Note that all of this info is coming from anonymous sources, not an official Samsung position, so take everything with a grain of salt.

The worst possible time

If the rumors turn out to be accurate, the Note 7 recall would come at the worst possible time for Samsung. Archrival Apple will announce a new generation of the iPhone next week, and concerns about the Note 7’s safety could sway potential Samsung customers towards the iPhone 7 Plus. A recall would also pour cold water over the Note 7’s excellent sales performance since its launch on August 19.

Samsung is typically quick to react to PR crises, so its silence over the issue could be a sign that it’s struggling to find a solution to a serious issue.

If you already have a Note 7, you don’t have reasons to worry too much. At this point, Samsung has already shipped millions of Note 7 units, and only five fire incidents have been reported so far. In other words, the chances of anything bad happening to you are very small.

We have reached out to Samsung for comment yesterday, but didn’t hear back.

Let us know your thoughts!