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In a
statement on Monday, Samsung said customers who trade in their
Note 7 phone for either a flat-screen or curved-screen version
of the Galaxy S7 can trade up for a Galaxy S8 or Note 8
smartphone launching next year through an upgrade program.
The world's top smartphone maker permanently ended Note 7 sales
due to continued reports of fire from the flagship device. In
addition to offering refunds or exchanges for a Galaxy S7
smartphone, Samsung has already offered financial incentives
amounting to 100,000 won ($88.39) to affected customers in South
Korea.
Users in the upgrade program will need to pay only half the
price of a Galaxy S7 device, rather than the full amount, before
exchanging to the S8 or the Note 8, Samsung said.
In offering the Note 8 upgrade option, Samsung indirectly
reinforced previous statements that the Note series will not be
discontinued. The company said the availability of such a
program in other markets will be dependent on the situation in
each country. It did not elaborate.
Samsung has stepped up marketing and promotion for its Galaxy S
smartphones to try to make up for some of the lost sales. The
Note 7's collapse is already costing Samsung $5.4 billion won in
operating profit between the third quarter of this year and the
first quarter of 2017.
Some analysts say Samsung will need to offer incentives to
affected customers as part of their efforts to limit long-term
damage to its brand and reputation from the Note 7's failure.
The South Korean firm is facing legal challenges from customers,
as well. Harvest Law, a domestic law firm, said on Monday one of
its lawyers, Peter Young-yeel Ko, and 526 others have filed a
lawsuit in a South Korean court against Samsung seeking
compensation of 500,000 won ($442.61) per person. Samsung did
not immediately comment on the suit.
The firm is also facing a proposed class action lawsuit from
three Galaxy Note 7 customers in the United States.
(Reporting by Se Young Lee and Yun Hwan Chae; Editing by
Muralikumar Anantharaman)
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