A top Samsung official issued an unusual video apology over Galaxy Note7 battery-related defects linked to fires and assured owners that replacement Note7 units are safe.
"With battery cell defects in some of our Note7 phones, we did not meet the standard of excellence that you expect and deserve. For that, we apologize, especially for those of you who were personally affected by this," said Tim Baxter, president and chief operating officer for Samsung Electronics America, in the video (see below) released early Friday. The video runs for 2 minutes and 24 seconds.
Baxter said Samsung has already exchanged 130,000 Note7 smartphones. The U.S. Consumer Product Safety Commission late Thursday said Samsung had received 92 reports of batteries overheating in the U.S., including 26 reports of burns and 55 reports of property damage, including fires in cars and a garage.
The CPSC issued an official recall of 1 million Note7 devices late Thursday and urged Note7 users to stop using them. In addition to an exchange for a new Note7 with a new battery, the CPSC said users have the right to seek a refund or an exchange. Samsung has also offered to exchange Note7s for the Galaxy S7 or Galaxy S7 Edge.
After the CPSC recall announcement, the U.S. Department of Transportation ordered that Note7 smartphones can only be carried by crew and passengers on planes if the phones are turned off and not connected to charging equipment.
Replacement units are safe, Baxter said. "To be clear, the Note7 with the new battery is safe. The battery cell issue is resolved. And this finding has been affirmed by a recognized independent lithium ion battery expert."
Baxter never admits in the video, however, that the battery problems caused fires or explosions.
Of note, Baxter said Samsung had notified the CPSC prior to issuing a global directive on Sept. 2 to stop selling all Note7 smartphones. Samsung's action at that time was widely interpreted as a recall, but not an official recall. CPSC Chairman Elliott Kaye said Thursday that Samsung's decision to issue its own recall before reaching out to the CPSC was "not a recipe for success."
In addition to his apology, Baxter repeated Samsung's earlier pledge to have new Note7 smartphones available at retailers "no later than next Wednesday, Sept. 21."
He also went a step further: "To those of you who love the Note, we will work every day to earn back your trust through a number of unprecedented actions." He didn't say what those actions will be, however.
The video apology won a positive review from one analyst.
"I like that Samsung did this video," said Patrick Moorhead, an analyst at Moor Insights & Strategy. "It personalizes the recall for consumers and puts a face on the company. This is intended to create empathy but also provide yet another message for consumers to return their Note7 phones."
Moorhead said the video recalled the time when Steve Jobs addressed the press on "antennagate" in 2010. Antennagate was the name Jobs gave to the controversy over the iPhone 4 when some users complained of dropped calls when touching the edge of the phone, a gesture which bridged a gap separating two antennas.
Analyst Jack Gold of J.Gold Associates, said the video was "exactly what Samsung needed to do to maintain consumer confidence in their products."
Gold said not all vendors would have produced such a video, which called attention to its exchange process and other steps the vendor has taken. "Samsung has taken the initiative to make things right and I suspect most consumers will be pleased … Samsung will likely suffer no ill will long term."
The exchange and refund process might be potentially costly to Samsung, he added, but "it puts a halt to the negative perception and helps them remain a reputable supplier of products in the consumer's eyes."
Jeff Kagan, an independent analyst, was less charitable. On a scale of 1 to 10 for effectiveness, he gave the Samsung video a 5.
“It’s an effort, but not strong enough to make a difference,” Kagan said. "The damage is done. Their brand is now damaged. The only question is how deep will that damage go and how long will that damage last?
"If anyone get’s injured, this will escalate very quickly.”