Samsung's Note 7 fiasco to have wider impact - analyst

TrendForce anticipates growing demand for components as competitors look to steal Samsung's market share

Samsung's decision to scrap its Note 7 device will have repercussions for the whole large-sized smartphone market, according to global market research firm TrendForce.

Following a turbulent couple of weeks which has seen numerous reports of the device catching fire, Samsung today announced it will permanently stop manufacturing the Note 7.

A Samsung spokesperson told CRN: "For the benefit of consumers' safety, we stopped sales and exchanges of the Galaxy Note 7 and have consequently decided to stop production."

TrendForce has now claimed that what is already bad news for Samsung will have an effect on the industry as a whole.

It claims that as Samsung's competitors look to take advantage of its misfortune by manufacturing more devices, the price of key components will be driven higher.

"TrendForce believes that Samsung's announcement will not stifle the price increases for key smartphone components such as DRAM, NAND Flash and AMOLED panels," it said.

"Rival brands are anticipated to take advantage of Samsung's crisis and expand their smartphone production.

"This in turn would aggravate the supply shortage situation in the component markets. Thus, memory prices will not only continue to rise but actually also surge higher than expected."

The analyst went on to say that a "substantial" portion of the Note 7's market share will go to three major Chinese brands - Huawei, Vivo and OPPO, as well as Apple's recently launched iPhone 7 Plus.

It predicted that Samsung manufactured around four million Note 7 units, most of which it anticipates being scrapped.