Customers Are Likely To Stick with Samsung

Samsung Electronics Co. asked retailers Monday to halt the sale of replacement models of a popular smartphone, extending the unwanted spotlight on the world's most popular phone maker.

But neither exploding Galaxy Note 7 devices nor just as dangerous replacements are likely to steer customers away, analysts said.

More than a month of headlines and warnings at airports have spotlighted how the phone's battery can malfunction, causing a fiery blast and unusable charred remains.

The news only got worse last week, with reports of devices that were hastily rolled out as a fix blowing up too. On Monday, the South Korean company announced plans to ask retailers to pull both the original and replacement Note 7 off store shelves and adjust production for now.

Yet despite the ongoing issues, the millions of people who bought or planned to buy a Note 7 are sticking with Samsung, giving the electronics giant the chance to come out of the troubles with just as many users as it did before, smartphone industry experts said.

With the help of discounts and promotions that will cut into Samsung's revenue, shoppers largely are opting for unaffected Galaxy S7 or older Note models, said Ryan Reith, program vice president for research firm IDC, citing conversations with mobile service providers and retailers. Samsung sells about 80 models across the world at any given time, giving consumers a huge range of alternatives, he said. The Note model makes up just 10% of Samsung's shipments, he estimated.

Other reasons people aren't switching include rival brands' declining prominence and the difficulty associated with switching to Apple's iPhone. HTC and LG offer comparable devices, but Samsung has blown past them by virtue of heavy marketing, superior interfaces and customer service.

Apple has been picking off users in emerging markets, but in countries with long-established cellphone services, such as the...

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