Wootrader.com is moving to https://financeboards.com - sign up for a free account.

Samsung Exploding Phone


Conventional wisdom would indicate that if Samsung recalled 2.5 million Galaxy Note 7 phones (it did) because they might catch fire or explode (they might) that would be good companies like Apple Inc. (NASDAQ:AAPLA) which make phones that do not normally catch fire or explode.

This time, however, conventional wisdom may not be right, according to a number of observers and experts.

Related: APPLE’S NEWEST IPHONE NOT EXPECTED TO BE FEATURE-RICH

Changing An OS Is Hard

For one thing, as everyone knows, Apple phones use one operating system. Android (Samsung) phones use another. Changing from one OS to another is not easy. Data, contacts, files, apps, all number of things have to be changed and most people don’t like that much change.

As Anthony Scarsella, research manager for IDC said, “Note 7 users are typically avid Samsung fans and even bypass the more popular GS7 and GS7e in favor of the Note series. For an advanced user like a Note 7 owner to completely leave the platform over waiting a few weeks for a replacement is highly unlikely considering previous investments in the Play Store.”

Android Models Abound

An easier alternative for a Note 7 user would be to switch – temporarily – to another Samsung model or even another Android model. Scarsella noted, “Competing Android-based flagship Phablet vendors stand the best chance of winning over N7 customers in the short term.”

Time will be a factor – as in how long Note 7 owners have to wait for their new (non-exploding) device to arrive. Officially Samsung says on its website that new approved Note 7s will be available no later than Sept. 21.

Why Apple’s New Phone Is Popular

If all that is true, you may ask, why did Apple gain $14 billion in market value early last week, despite a broad selloff? It could be, as some speculate, due to investors thinking Samsung’s problems actually would have a positive impact on Apple.

It could also be, as others have said that – as is often the case – any new iPhone iteration from Apple gets fans excited and sells phones. That certainly seemed to be the case with carriers such as Sprint Corp. (NYSE:SC) and T-Mobile US Inc. (NYSE:TMUSB) reporting pre-orders for the new iPhone up 4 times orders from last year. Not bad for a phone most analysts said had almost no new features.

Related: CHANCES IRELAND WILL LEAVE THE EU (AFTER THE APPLE RULING)

Hold The Horses Says JPM

Meanwhile, CNBC reported that JPMorgan analyst Rod Hall told investors it was “premature” to over play the optimism with regard to recent iPhone sales.

According to Hall, "In the case of both AT&T and VZ, our Telco team believes volumes are up a little due to the more aggressive-than-expected promos but not substantially over prior expectations," Hall wrote in a note to clients Monday.

"At present we believe the increased promos could pull demand into the September Qtr."

The promotions encourage customers to trade in their current iPhone 6 or 6s for a free iPhone 7 and will likely end in October.



Get Started For Free