Samsung Halts Galaxy Note 7 Production as Battery Problems Linger

By DAISUKE WAKABAYASHI, CHOE SANG-HUN and VINDU GOELOCT. 10, 2016 Trying out the Galaxy Note 7 in Seoul, South Korea. Samsung’s decision came after major mobile carriers in the United States said they would stop issuing Note 7 devices because of safety concerns. Credit Kim Hong-Ji/Reuters In 1995, furious over quality problems with one of his company’s mobile phones, Lee Kun-hee, the chairman of Samsung and arguably the most famous businessman in South Korea, set a pile of 150,000 defective phones on fire outside a factory. The phone bonfire became a turning point for Samsung’s two-decade rise from an electronics maker associated with inexpensive knockoffs to one considered a leader in product quality, design and sales. But to the company’s critics, that employee motivational moment has also served as a wry historical foreshadowing of safety problems with one of Samsung’s top-selling smartphones. The company has temporarily halted production of its Galaxy Note 7, a high-end answer to the latest iPhones from Apple, a person familiar with the decision said on Monday. In a statement, the company also asked retailers and telecommunication carriers to stop selling the phones until the problem is fixed, and said “consumers with either an original Galaxy Note 7 or replacement Galaxy Note 7 device should power down and stop using the device.” The phone has been blamed for at least one house fire, a burning Jeep and several alarming moments on planes when the devices started smoking mid-flight. The Federal Aviation Administration is so concerned that airline passengers are routinely warned that they should not turn on or charge the Galaxy Note 7 during a flight or stow the phone in checked baggage. Southwest Airlines, which had to evacuate a plane on Wednesday after a Samsung phone caught fire, said the details of the incident are still being investigated. AT&T Will Stop Exchanging Fire-Prone Samsung Galaxy Note 7s OCT. 9, 2016 TECH TIP What to Do if You Have a Samsung Galaxy Note 7 SEPT. 16, 2016 Samsung Stumbles in Race to Recall Troubled Phones SEPT. 15, 2016 Samsung to Recall 2.5 Million Galaxy Note 7s Over Battery Fires SEPT. 2, 2016 The decision to stop selling the Galaxy Note 7 comes just five weeks after Samsung said it would recall 2.5 million of them — the largest ever in the smartphone industry — after early reports of battery fires. Samsung had said it believed it had identified the issue, and allowed consumers to trade in their phones for new ones. But production was halted after the four major United States carriers said they would stop selling or replacing Galaxy Note 7 smartphones because of additional reports of fires, including with the replacement models. Three of Australia’s biggest telecom companies — Telstra, Optus and Vodafone Australia — said they had stopped shipping Galaxy Note 7 phones to customers after reports that the replacement model had caught fire in the United States. The company said it hoped to provide an update within a month. The federal Consumer Product Safety Commission praised Samsung’s move and urged consumers to stop using the phone. The missteps by Samsung, the world’s top seller of smartphones, have given a rare opportunity to competitors like Apple to close the gap with the South Korean giant as the holiday shopping season approaches. “We believe this incident has destroyed billions of dollars of Samsung brand value,” said Laura Martin, a technology analyst with Needham & Company. “The consumer says, ‘Which one blows up? I’m just going to stay away from Samsung.’” The Galaxy Note 7 featured a higher-capacity battery to help its increasingly sophisticated features, like an iris scanner for added security. It also supported fast wireless charging technologies. It was the most expensive phone offered by Samsung, putting it in direct competition with Apple’s iPhone. “Definitely, Apple is the biggest beneficiary” of Samsung’s problems, said Linda Sui, a director at research firm Strategy Analytics. AT&T on the Samsung Recall Ralph de la Vega, the vice chairman of AT&T, discusses the company’s announcement that it would stop selling or replacing Galaxy Note 7 smartphones because of reports of fires. By CNBC on Publish Date October 10, 2016. What’s more, Google, the company whose Android software runs on nearly all of Samsung’s smartphones, is now pushing harder to sell its own phones. Last week, Google unveiled the Pixel — the first smartphone that it designed and manufactured. At the same time, aggressive smartphone manufacturers like Huawei and Xiaomi are looking for ways to expand beyond their footholds in China to compete with Samsung all over the world. It is difficult to say what the impact of the phone problems will be on the company’s overall sales. Before the recall, the research firm Strategy Analytics had estimated that Samsung would sell 15 million Note 7 units in 2016. But now, the firm is estimating that Samsung, with about $180 billion in annual revenue, could lose more than $10 billion from the ongoing troubles. Samsung’s reputation is already taking a big hit online, according to an analysis by Spredfast, a social media marketing firm that helps businesses analyze chatter on Twitter and other social networks. Since the Note 7’s problems began to receive widespread attention, negative Twitter messages about the device rose 450 percent compared to the previous five and a half weeks, the company said. “While this is itself a huge problem for Samsung, we also found a steep 186 percent rise in negative sentiment about Samsung itself,” Chris Kerns, Spredfast’s vice president of research and insights said in a statement. “Digging deeper, it’s clear that this is not just an isolated issue with one product, but is, in fact, a full-blown brand crisis.” Like many Asian companies, Samsung struggled for years to establish a strong reputation in the West. Shortly after Apple introduced the iPhone, Samsung went headlong into the smartphone market. Samsung had been gaining some ground in high-end smartphones with its latest Galaxy S phones, which have curved edges and offer a premium feel over the company’s budget phones. When it released the Galaxy Note 7 in August — with its 5.7-inch screen and a price tag exceeding $800 — it was supposed to add to that momentum. The recurring problem has led industry experts to wonder whether the problem went beyond sloppy production and resulted from a faulty battery or software design. Technology companies are hardly immune to manufacturing issues. In 1994, Intel was forced to recall its flagship Pentium chip because of a mathematical mistake built into it. Dell recalled more than 4 million laptop computers in 2006 because of exploding lithium ion batteries produced by Sony. And companies like Fitibit and Microsoft have had manufacturing problems over the years. Companies with strong brands can withstand product quality problems. Over a two-year span starting in 2009, Toyota recalled about 9 million cars because of issues related to sudden, unintended acceleration. Its chief executive appeared before Congress, and Toyota paid a $1.2 billion fine to the Justice Department for concealing information about defects from consumers and government officials. In 2015, Toyota was the world’s largest automaker. Samsung is counting on customers like Justin Brooke of Cooper City, Fla., whose family owns three Note 7 phones as well as Samsung televisions and tablets, to stay loyal to the brand. Mr. Brooke said he thinks the fire risk has been overblown. He loves the Note 7’s big screen and pen feature, which he uses to critique websites for his advertising training business, DMBI Online. “For me as a business owner, it’s the most productive phone on the market,” he said. Still, he admitted to some apprehension. He said his family never charges the batteries on their phones to 100 percent to reduce the risk of overheating. “Maybe we’re in denial,” he said. He said his father asked him for a phone recommendation on Sunday night, and he recommended another Samsung model, the S7, which has not been implicated in the fires, or a Google Pixel phone. Michelle Innis contributed reporting.

5G in 2020 – will Pakistan leapfrog or stay behind?

By Shahram Haq Published: August 7, 2016 4 SHARES Share Tweet Email With the advent of 3G and 4G services, Pakistan has already been witnessing an information technology revolution that has enabled hundreds of startups to develop and build businesses. PHOTO: FILE With the advent of 3G and 4G services, Pakistan has already been witnessing an information technology revolution that has enabled hundreds of startups to develop and build businesses. PHOTO: FILE LAHORE: The telecom users in Pakistan will enjoy seamless connectivity with over 30 times more speed than the current 4G technology as the world’s fastest and most technologically advanced fifth generation (5G) internet technology is poised to enter the market in the next few years. Slated for launch in 2020, the 5G technology will offer data speeds of up to 1 gigabyte (GB) per second and during trial as high as 10GB per second. Pakistan’s 3G/4G users doubled to 29.53 million in FY16 While mobile data consumption across the world may be rising, the advent of 5G will transform the possibilities of what smartphones and other mobile devices are capable of achieving. The next generation technology will use the ‘millimetre wave’ radio spectrum. Higher frequencies, like this, are capable of carrying a significant amount of data, although more research is needed before this technology hits the market in 2020. It is still not certain which countries will take the lead in launching the 5G technology, however, experts say South Korea and China are expected to be on the front followed by Japan and the United States. While 5G will be an extension of 3G and 4G, it is expected to be dramatically different. 5G will be incredibly fast, in fact a lot faster than the existing technologies, but this is only one side of the story. 5G also has the potential to open up new avenues for integrated smart cities, self-driving cars, star wars-inspired hologram phones and even autonomous drones. According to a report of the World Bank, a 10% increase in high-speed internet connections leads to a rise of 1.3% in economic growth. This means that by connecting 327 million people around the world with high-speed internet, the global gross domestic product (total size of the world economy) can be boosted by $1 trillion. Pakistan’s LTE speeds one of the slowest in the world For developing countries like Pakistan, such endeavours can positively contribute to ensuring sustainable and inclusive growth and might be Pakistan’s best bet towards poverty reduction and increased productivity. The million-dollar question remains, “Will developing countries, like Pakistan, leapfrog ahead or be left behind, as the world is attempting to enter the fourth industrial revolution?” Companies at the forefront The technological giants at the forefront of introducing the 5G technology are China Mobile, Nokia, DoCoMo, Huawei, Samsung and Ericsson. The world’s most superior internet technology will provide virtually unending broadcast data in gigabits. 5G technology is fully compatible with the previous generations including 4G, 3G and 2G. It will be empowered to provide uniform, uninterrupted and smooth services across the globe. 5G in Pakistan Minister of State for Information Technology and Telecom Anusha Rehman has recently indicated that 5G technology will be introduced in Pakistan by 2020. This has been a welcome announcement and China Mobile, according to media reports, has expressed its interest and asked the PTA to allow it to use 5G spectrum on a trial basis. Reports suggest that China Mobile has completed first phase of the 5G programme in China, where it tested new wave forms and key technologies. 3G/4G users up 3.74%, but growth slowing China Mobile and Huawei have also showcased 5G 3.5GHz prototype, 5G above 6GHz high-band prototype, 5G network slicing solutions, 5G smart car use case solution along with other 5G innovations in the Mobile World Congress in Shanghai. It is expected that Zong, a China Mobile company, will be looking to initiate tests of the prototypes already developed and being conducted in China. With the advent of 3G and 4G services, Pakistan has already been witnessing an information technology revolution that has enabled hundreds of startups to develop and build businesses around these technologies. 5G, which will focus on the ‘Internet of Things’, will enable a technological revolution of a different kind, where an entire digital ecosystem will be woven around people’s lives through the internet. Let’s hope that Pakistan is part of the 5G revolution and is included in the first group of global operators to test the new technology for commercial use in the near future. The writer is a staff correspondent Published in The Express Tribune, August 8th, 2016.

BRICS to create development bank, 'mini-IMF'

Leaders of the BRICS group of emerging powers meet Tuesday to launch a new development bank and a reserve fund seen as counterweights to Western-led financial institutions. PHOTOS Brazil will host the VI Summit of Heads of State and Government of the BRICS in Fortaleza and Brasilia from July 14 to 16. (Photo: MRE Brasil's Facebook page) Enlarge Caption FORTALEZA: Leaders of the BRICS group of emerging powers meet Tuesday to launch a new development bank and a reserve fund seen as counterweights to Western-led financial institutions. Brazilian President Dilma Rousseff hosts the leaders of Russia, India, China and South Africa in Fortaleza on Tuesday before talks with South American leaders the next day in Brasilia. The summit will mark the first face-to-face meeting between India's new Hindu nationalist Prime Minister Narendra Modi and Chinese President Xi Jinping. For Russian President Vladimir Putin, who visited Argentina and Cuba before coming to Brazil, the trip gives him a chance to hammer home his calls for a "multipolar" world amid tensions with the West over the Ukraine crisis. "Together we should think about a system of measures that would help prevent the harassment of countries that do not agree with some foreign policy decisions made by the United States and their allies," Putin told Russia's ITAR-TASS news agency. Russia has been excluded from the G8 group of industrialized powers as punishment for its annexation of Crimea and perceived meddling in Ukraine. The United States is threatening to impose new economic sanctions on Russia over accusations that it is backing pro-Moscow separatist rebels in eastern Ukraine. The summit comes as the economies of some BRICS countries, which together represent 40 per cent of the world population and a fifth of the global economy, are cooling down. Russia and Brazil are expected to see growth of just one per cent this year. The five emerging nations unveiled in 2013 their plans to create the bank, which aims to rival the Washington-based World Bank while the reserve is seen as a "mini-IMF." The creation of the bank will give a backbone to the BRICS, which is not a formal international organization, said Marcos Troyjo, Brazilian director of BRICLab research center at New York's Columbia University. "They are only taking their first steps towards a platform for building consensus on international agenda items such as rules for international trade, joint action at the UN or the WTO," he told AFP, referring to the World Trade Organization. The bank will have initial capital of $50 billion with each country contributing an equal share, while the reserve will have $100 billion at its disposal. The bank is "key to foster growth for the BRICS countries," Brazilian Industry and Commerce Minister Mauro Borges said. For the fund, China will make the biggest contribution, $41 billion, followed by $18 billion from Brazil, India and Russia and $5 billion from South Africa. Despite their agreement on the need for a bank, the five countries are split on where it should be headquartered. Shanghai is seen as the frontrunner to host the bank but South Africa insists on having it in Johannesburg. New Delhi and Moscow are the other candidates. The five nations are also negotiating who should hold the bank's rotating presidency first and the make-up of the board. The talks in Fortaleza will open a series of marathon summits and bilateral meetings in Brazil. After the BRICS meet with South American presidents in Brasilia on Wednesday, Xi will launch the China-Latin America forum, highlighting Beijing's growing interests in a region historically tied economically to the United States. Xi will then travel to Argentina, Venezuela and Cuba. - AFP/rw ============== "Beijing has been nudging state enterprises to wean themselves off U.S. software and service firms, chiefly IBM, Oracle and EMC. The drive, which accelerated after Washington indicted Chinese army officials, has dimmed the brightest star in Big Tech’s otherwise dull constellation."

China’s “De-IOE” campaign is taking a bite out of some Silicon Valley stalwarts. For those unfamiliar with the term, it’s being used by tech executives to describe Beijing’s nudging of state enterprises to wean themselves off U.S. software and service firms, chiefly IBM, Oracle and EMC. The drive, which has been going on for at least a year, but accelerated after Washington indicted Chinese army officials, has dimmed the brightest star in Big Tech’s otherwise dull constellation.

China is the third-largest IT market worldwide - and growing fast. Total spending on information technology should grow by about 11 percent this year to $125 billion, estimates Forrester. That’s about twice as fast as the world as a whole. The Chinese government, however, wants to switch the massive companies under its wing to domestic suppliers like Huawei and Lenovo in the name of economic development and security. American firms are increasingly left out.

China only accounts for about 4 percent of sales at IBM and Cisco. At Oracle and EMC it’s probably even smaller. Apple gets 20 percent of its revenue from the Middle Kingdom. But big banks, telecoms operators and state enterprises are natural targets for U.S. snooping, and purchasing decisions are more vulnerable to pressure from authorities. Such matters don’t really affect Chinese consumers, which may explain why Apple’s sales in China expanded last quarter and Cisco’s fell by double digits.

The big hardware companies face the most pain. Since China is still developing rapidly, companies and enterprises first need to buy physical gear – software and services can then be run on this foundation. Software piracy is also widespread. In the first instance, that means hardware sellers will be the first to face falling sales. It’s more about missed opportunity for software companies.

IBM is particularly exposed. About half of its sales in China come from hardware. IBM’s top line in China fell 20 percent in the past quarter. Further declines lie ahead. Microsoft, on the other hand, will see what had been a fast-growing market slow, or even shrink, after China painted a target on its back by banning the installation of Windows 8 on government computers.

Investors don’t seem to be expecting much growth from these tech giants. IBM, Oracle and EMC – as the acronym implies, the chief targets in China - trade at an average 20 percent price-to-earnings discount relative to the S&P 500. A substantial discount also applies to their compatriots in the crosshairs, Cisco and Microsoft. Quarterly results, which start rolling in this week, may expose a bit more Chinese pain to justify these low multiples.

Obama blocks Chinese wind farm in Oregon over national security

Fri, Sep 28 17:46 PM EDT 1 of 4 By Rachelle Younglai WASHINGTON (Reuters) - President Barack Obama on Friday blocked a privately owned Chinese company from building wind turbines close to a Navy military site in Oregon due to national security concerns. The rare presidential order to block the project comes as Obama campaigns for a second term against Republican Mitt Romney, who has accused him of being soft on China. Ralls Corp, which had been installing wind turbine generators made in China by Sany Group, will now be forced shelve its plans and divest its interest in the four wind farm projects it acquired earlier this year. The wind farm projects were all within or in the vicinity of restricted air space at a naval weapons systems training facility in Oregon, the administration said. "There is credible evidence that leads me to believe" that Ralls Corp and Sany Group "might take action that threatens to impair the national security of the United States," Obama said in the order issued by the White House. The Committee on Foreign Investment in the United States (CFIUS) had ordered Ralls to stop all construction and operations at its wind farm projects while the government completed its investigation and provided its recommendation to Obama. Although CFIUS reviews dozens of foreign investment deals for potential national security concerns, the president is rarely called upon to issue a formal order as companies usually abandon their deals or divest assets when the panel takes issue with their transaction. The last time a president formally blocked a deal on national security grounds was in 1990 when then President George H.W. Bush stopped a Chinese aero-technology company from acquiring a U.S. manufacturing firm. Obama's decision comes as two other Chinese companies are vying for CFIUS approval. DIVEST Ralls Corp had hired the George W. Bush administration's top lawyer Paul Clement to help represent the company as well as a former U.S. assistant attorney general, Viet Dinh, who helped the Republican administration develop the Patriot Act. But that appeared to do little to convince the current administration to allow the company to resume operations. Ralls Corp, which is owned by two Sany Group executives who are Chinese citizens, now has 90 days to divest all its interests in the project companies. Ralls Corp had no immediate comment. The Treasury Department said Obama's decision was not a precedent for other investments from China or any other country. Acting Commerce Secretary Rebecca Blank said the United States generally welcomed investment from China but not in every case. "Particularly when you're talking about China, but there's other countries where this is true too, one has to be worried about national security concerns," Blank said in remarks at the Council on Foreign Relations earlier on Friday. CFIUS is chaired by the treasury secretary and includes Blank and other Obama cabinet members, including his secretaries of state, defense and energy. (Additional reporting by Doug Palmer; Editing by Vicki Allen and Claudia Parsons) ==================== Chinese mogul sues Obama Get short URL email story to a friendprint version Published: 28 November, 2012, 21:58 TAGS: Conflict, China, USA, Globalization, Global economy, Security, Sanctions, Court US President Barack Obama (AFP Photo / Jewel Samad) President Obama this year ruled against allowing a Chinese man to build a wind farm in Oregon, calling him a ‘national security threat’. Convinced that the president was biased against the Chinese, the man is taking Obama to court. Wu Jialiang, CEO of Ralls Corp. and one of China’s richest men, is challenging Obama in a federal court today on his refusal to let him build a wind farm on US ground he had purchased – even though other foreigners had built businesses in the same area, the Christian Science Monitor reports. “We are suing the president because we do not accept his finding that we are a national security threat. It is not true,” Jialiang said. Ralls Corp. is affiliated with Sany Group Ltd., one of China’s largest and wealthiest private companies with its president ranking as the sixth richest man in China. The company bought four plots of land in Oregon on which it planned to build a wind farm in March. But the Committee on Foreign Investment in the United States (CFIUS), which reviews foreign purchases, blocked the deal, claiming the agency found “credible evidence” that this was a national security risk – especially with its close proximity to a military facility where unmanned drones are tested. After Ralls Corp. disputed the decision, President Obama issued an executive order enforcing the CFIUS ruling. This was the first time a US president used his power to block a business transaction on security grounds in 22 years. Angered by the decision, Sany Group Ltd. filed a complaint against Obama and the CFIUS at a District Court in Washington, claiming that the presidential order exceeded its constitutional rights, since it provided no detailed evidence as to why Ralls Corp. was a national security threat. The company has made numerous investments in Europe, and 15 percent of its total sales are made overseas. Jialiang also expressed frustration with the financial loss his company faced when the executive order was made. “This measure caused us more than $20 million in direct investment losses, excluding indirect losses,” Jialiang said in a press conference in Beijing. The district court judge is now reviewing the case to decide whether or not to accept it. Sany Group Ltd. has threatened to take the case to the US Supreme Court if its complaint is rejected, Forbes reported in mid-November. Although both Chinese and US lawyers find it unlikely that the Chinese company will win the lawsuit against Obama, the case represents China’s increasingly intrepid relationship as a challenger of the US. The case also displays US hesitation to allow Chinese competition on American soil. Chinese investors have frequently complained about US hostility towards them. “When you challenge the Titan, the US, you appear a hero,” Hao Junbo, an expert on transnational legal cases, told the Christian Science Monitor. As China becomes a greater competitor and world power, the US has felt weary about allowing big Chinese investors to bring their businesses to the US for many reasons similar to the country’s former relationship with Japan and Korea. In the 1980’s, Japan was a rising economic challenger. When the Japanese bought the Rockefeller Center, an enormous American symbol and huge investment, Americans worried that the Japanese were trying to undermine them in the business world. Many of Japan’s products were also superior to those produced by the US. But Japan was also a US ally and had no interest in dominating the world politically. The country’s main concern seemed to be selling its products and bringing in cash. Fears about Chinese dominance, on the other hand, are more than just economic. Americans are concerned that China may try to dominate with its political ideologies, which are radically different from Western beliefs. While Japan was not much of a military threat, China’s military power is rising and the country often intervenes in global affairs. Its neighbors have become fearful of the rising power. China has also supported countries that US considers threats or enemies, such as North Korea. China is not just an economic competitor, but a political and military one as well. US fears of Chinese investors are just one indicator of the perception of threat. Jialiang’s company was not the first whose investment was rejected without much of a valid reason: a congressional panel last month branded two Chinese telecommunications companies as potential threats to national security. Huawei and ZTE will now face immense difficulties conducting business in the US. “The US government and people do not think the Chinese government is 100 percent like other ones. They always have doubts; it is cultural and political discrimination,” said Hao Junbo, an expert on transnational legal cases. Jialiang’s fierce confrontation against President Obama is likely to shed light on the US perception of China. “This could well be an indication of things to come when Chinese investors will stand up if they feel they have been badly treated. One could argue that this is a straw in the wind,” Dr. Karl Sauvant, author of the book “Is the US Ready for FDI from China?” told the Christian Science Monitor. ============