Samsung Shortchanged Singaporeans On Note 7 Refund

Samsung had announced the refund details with the following options (Details available here):

1) Exchange for S7 Edge 4G+ (32GB Internal), plus additional $250

2) Full refund of $1168

On the surface, the $250 seems better than most countries, but in fact, it is the worst offer because many people had neglected the fact that they had already paid an upfront price for the Note 7! This amount varies among plans and is $398 for a Combo 3 Plan with Singtel.

In order to provide an apple-to-apple comparison, we should analyse Samsung's offer based on the "End State" - that is, the state that you are in, due to this Note 7 fiasco, compared to if you were to get to the same state yourself today. 

By doing so, you can clearly see the value of this refund offer. Let's analysis this offer, paying attention to how much apologies are packaged into it.

The 2 options above will result in the following 2 End States:

1) Exchange --> End State (A): A 2-year contract with the telco + a S7 Edge phone

2) Refund --> End State (B): A 2-year contract with the telco + a new phone (for purpose of illustration, I am using iPhone 7 Plus (128GB))

The following are the assumptions used in this illustration:
1) You are with Singtel
2) You are on Combo 3 Plan
(Note: You can do your own analysis with other options as desired. You can find the details of the earlier Note 7 plan from various telcos at HardwareZone here.)

So let's go through the 2 end-states and compare the 2 paths. 

End State A (Exchange): 2-Year Contract with Singtel + S7 Edge 4G+ (32 GB)

Path 1: Go Through Note 7 Fiasco and Change To S7 Edge

Total Actual Investment:
     $398 (Note 7 Upfront Cost) - $250 ('Courtesy' from Samsung)
     = $148 (Nett amount you paid)
(Remember you had already paid $398 for the Note 7 phone!!!)

Path 2: Directly Purchase the S7 Edge Through Singtel On Combo 3 Plan


The following is the offer from Singtel:

With upfront cost of $368, you get:
- S7 Edge
- 2-Year Contract
- Free gift: 128GB MicroSD + GearVR

The retail value of the free gifts are $98 and $148 respectively as shown below:

 

Thus, total investment to reach this end state (2-Year Contract + S7 Edge)

     = $368 (S7 Upfront Cost) - $98 (Value of MicroSD) - $148 (Value of Gear VR) = $122

Therefore, based on the above, Samsung had shortchanged you: $26.

End State B (Refund): 2-Year Contract + iPhone 7 Plus (128GB)

Path 1: Go Through Note 7 Fiasco and Get Your iPhone

The price of iPhone is as follows:

Total investment:

     $398 (Note 7 Upfront Cost) + $1418 (iPhone Price) - $1168 (Samsung Refund) = $648
(Always remember that you had already paid $398 for the Note 7 phone!!!)

Path 2: Directly Purchase iPhone 7 Plus (128GB) through Singtel on Combo 3 Plan

The following is the offer from Singtel:

Total investment  =  $538

Therefore, Samsung had again shortchanged you: $110!

Other Combinations are as follows:

Using Combo 2 to get S7 Edge

End-State A, Path 1 (Exchange Note 7 for a S7 Edge):
     $718 (Note 7 Upfront Cost) - $250 ('Courtesy' from Samsung) = $468

End-State A, Path 2 (Buy S7 Edge from Singtel):
     $698 (S7 Upfront Cost) - $246 (Gifts)
     = $452

Samsung shortchanged you: $16

Using Combo 6 to get S7 Edge

End-State A, Path 1 (Exchange Note 7 for a S7 Edge):
     $148 (Note 7 Upfront Cost) - $250 ('Courtesy' from Samsung)
      = -$102 (You literally take back $102 nett)

End-State A, Path 2 (Buy S7 Direct):
     $128 (S7 Upfront Cost) - 246 (Gifts)
     = -$118 (You can take back $16 more than path 1)

Samsung shortchanged you: $16

Summary

In general, if you choose the exchange, your lost is about $20; on the other hand, if you choose a full refund, your lost will be about $100.

Remember: The above is just the baseline, if you take into account the following:

- Nonrefundable associated items (Lens kit, screen protector, wireless charger, etc)

- Amount of time spent by Note 7 users (your salary of $3000 would equate to $130+ per day worth of effort)

- Trouble and inconvenience 

You can clearly see that the current package is a total ripoff to Singapore Note 7 users!

The argument here is not about whether Samsung should compensate your time and inconvenience, but it is important for you to realise that there is absolutely no element of apology or any attempt to gain back the trust of their supporters in the package, it is simply a plain business deal - Designed for you to lose $20 if you selected an exchange and $100 if you selected refund. This is a striking contrast to Mr Koh Dong-Jin's verbal commitment to gain back customers' trust, as well as Samsung Singapore's numerous apologies on Facebook. 

If Samsung does not review the offer, including proposing the 64GB S7 Edge instead of the 32GB. There is really no point for the exchange, as the S7 Edge is already 8-months old and it will just depreciate further.

In response to numerous complains and suggestions, Samsung Singapore's reply is always: "... take into consideration...".

However, from a business profit perspective and the way the package was structured so far, it is highly unlikely that there will be any changes because their main objective is to close this issue as soon as possible, not to address your concerns.

Today, when I look back at how the above package was crafted by Samsung, coupled with the earlier posts informing us that they were working closely with telcos, thus the delay - I can't help but postulate that their time spent with telcos was not for the interest of Note 7 users, but rather to retrieve the contract data in order to 'candy-coat' the above ripping package. I could be wrong, but given the known parameters, I am more inclined towards this conclusion.

Nevertheless, given the existing choices, it would be much better to get the full refund first, followed by either one of the followings:
* Get your desired phone,
* Use back the old phone and wait for the next 'WOW' phone, or
* Get a simple phone that you can sell off next year to get a better one

By doing the above, you opened up more options for you to get the next best phone when it comes. If you exchanged for an 8-months old S7 Edge now, you will not be able to get S8 a few months later. Even if you have the Samsung Concierge, you would not be able to change to Note 8 immediately when it is out as you would not have fulfilled the 1-year term yet.

If you are thinking of exchanging for the S7 Edge now, and hoping to sell it off and get S8 when it is out, DON'T!!! New phones depreciate the most, and if you are thinking of this approach, you should get the full refund first and get a 2nd-hand S7 Edge instead, which cost around $600++ (according to HardwareZone, link below). You will not lose as much if you sell off your 2nd-hand S7 Edge instead.

There are other arguments that I would like to address here:

1) "Portable lens kit is free, thus it should not be refundable."

- This sounds reasonable on the surface, however, imagine this scenario:

A) Note 7 sold at $1168, with a free gift of portable lens kit (highlighted to be retailing at $198)

B) Note 7 sold at $1168 nett

Which would you buy? Well, "A" of course. Since the free gift affects your decision, it indeed has an associated value that is only fair to be refunded accordingly. Most importantly, retail purchase should be refunded at retail price, while free gift could be valued and refunded accordingly.

2) "We should not blame Samsung Singapore since they did not want this to happen."

- Without a single doubt, this is absolutely correct. Using the same argument, Note 7 users also did not want this to happen, so why is Samsung Singapore punishing them?

3) "Samsung Singapore had done their best to help Note 7 users in Singapore."
- This is totally untrue. In fact, they had sabotaged all Singaporeans with the following:

 It is Samsung Singapore who told all airlines to ban Note 7 with immediate effect, leaving many Note 7 users scrambling with their phones! Many had to even dump their phones overseas without the chance to perform a proper backup!

Samsung Singapore should have notify airlines about the US Department of Transportation's order, and suggest the airlines to remind their passengers with US-bound flight about this. At the same time, advising airlines to continue supporting Note 7 users, especially allowing them to bring the phone back, such as by switching it off during flights. If there are any further concerns, Samsung could provide fireproof boxes, which was done overseas.

This is something that I cannot forgive Samsung Singapore. Note 7 issue is bad enough, yet they created a bigger mess and a hell lot of issues for Singaporeans. They justified these acts in the name of 'safety of consumers', but I am more prone to conclude that they are just trying to cover their own backsides to avoid this.

[21/10/2016 Updates: Hardwarezone SG has a post comparing the package around the World. It is a good post, but did not take into account the Upfront cost. The article's conclusion is also to opt for the full refund. You may also wish to look at it here.]

Open Letter to Samsung On Note 7

Dear Samsung,

First of all, thanks for your continual effort towards innovation and the cool features in Note 7.

Unfortunately, there were some imperfections, which you had rectified it swiftly, however, the same problem persisted.

Phone that caught fire is not something new. iPhones have their fair shares of such incidents — well ahead of Note 7.

The number of reported cases of Note 7 is puzzling and does not make any sense, both demographically and statistically. Most appalling are the recent claims about newly exchanged Note 7 that caught fire.

This ended with yet another recall and the advisory note for all Note 7 users, including original and exchanged sets, to power down their phones and not to use it.

Blindly calling for Note 7 users with replacement phones to shutdown and not to use it, is in fact, another form of irresponsible act. Today, how many people can shutdown their phone for 2 hours? Not to mention indefinitely.

Given the demographic of the issue, the initial claims about faulty batteries from a specific manufacturer does not stand well. If the claim is true, there should have been an even distribution of reported issues across the World. In this perspective, Samsung had not been transparent on this.

Samsung produced numerous versions of Note 7 phones as follows:

Source: https://www.techwalls.com/samsung-galaxy-note-7-sm-n930-model-number-differences/

Could the issue be due to a specific variance of the phone? Was the initial global recall a play-safe act that also recalled phones that are not directly affected, thus skewing the distribution? Was the ‘faulty exchanged phone’ exaggerated due to specific cultural inclination for prank?

If Samsung had, on the very first instance, provided the details of each individual case, including:

1. Version that exploded
2. Country of incident
3. Distribution channel (e.g. Telco involved)
4. Damaged phone surrendered for forensic (Yes/No)

The issue would have been much more manageable.

Lithium technology in general are subjected to such risk. iPhone also had a long history of such incidents.

I hope Samsung can understand that this is no longer about the reputation of the company or the phone itself, it is about the general well-being of the public as a whole. If Samsung continues to perform a blind recall or advisory note to shutdown and not to use the phone — without providing actual distribution of the issues, the company’s ability to manage crisis would be doubted. How could anybody continue to trust Samsung, as a company, to care for the well-being of their users?

It is now not just the Note 7 phone itself, it involved the associated accessories, the inconvenience; worst, the fact that the Note 7 users are viewed as ‘monsters’, carrying a phone that could explode anytime— All thanks to Samsung’s inability to manage the situation well.

If an iPhone can explode during delivery, there is no reason why the Note 7 issue could not be due to some telcos’ improper storage and distribution of the Note 7 itself.

In short, Samsung is not matured enough to handle such situation; on the other hand, Apple had managed this really well, attributing individual cases to consumers.

Refunds of Note 7 is underway, there is no details on how Samsung is going to compensate the Note 7 users and their associated Note 7 specific accessories (such as screen protector, telephoto lens, S View standing cover, chargers, etc.), as well as the great inconvenience; most importantly, the branding of Note 7 users as being silly consumer s— one who bought a sub-quality product at a premium price. Remember: People bought premium phones to showoff and be cool, not to be shamed or subjecting themselves to ‘special’ treatments on board the plane!

This blind recall had greatly angered many Note 7 users. Some of them would actually prefer to continue using it if Samsung had categorized the issue accordingly and recall affected versions based on statistical evidence rather than the current blind recall. If Samsung had taken this approach while continuing supporting the other variants, this issue will not be as big as today.

Let’s see how Samsung is going to pacify their Note 7 users.

[Side note: Since Samsung had used the same battery supplier as iPhone, and with the numerous iPhone 7 explosions happening around the World, let’s see how different the actions that these 2 major phone makers take. Samsung, this is yet another skill that you need to “copy” from Apple — watch closely and learn the ropes!]

[This article also appears on: Medium]