Samsung Mulling Refurbished Galaxy Phone Sales

In a move that may make Samsung’s flagship Galaxy handsets more affordable to some buyers – and help the company cope with a plateauing smartphone market — the South Korean device maker is reportedly readying a refurbished premium phone program.

According to a report in Reuters, the company plans to resell phones that are returned by users at the end of their one-year replacement programs. After being inspected and refurbished, the devices will be resold at significant discounts.

In the U.S., Apple sells certified refurbished iPhones in the secondary market via resellers (the company also sells other refurbished items like Macs and iPads directly). As noted in the report, iPhones fetch roughly 69 percent of their original value after a year on the market, compared to 51 percent for Samsung Galaxy smartphones.

By offering refurbished premium phones, Samsung appears to be adjusting to a period of flat growth, or potential decline, in the smartphone market.

Last month, IDC said that during the second quarter (Q2) of 2016, vendors had experienced two sequential quarters of negligible market growth on a year-on-year basis. In Q2, the world’s smartphone vendors shipped 343.3 million handsets, a 0.3 percent increase.

Gartner last week published more upbeat figures. The technology research firm said smartphone sales totaled 344 million in Q2, a 4.3 percent year-over-year gain. First-place Samsung sold 76.7 million units, followed by Apple whose sales slipped 7.7 percent, dropping to 44.4 million from 48 million a year ago.

By offering refurbished versions of still-desirable phones, particularly in emerging markets, Samsung and other vendors have another tool in their arsenal to combat tightening market conditions. In total, used smartphones account for an estimated 8 percent of the market, totaling $17 billion this year, stated the report citing figures from Deloitte.

Earlier this month, Samsung unveiled its large-screen (5.7-inch) Galaxy Note7. Skipping over the Note6 and aligning the phablet’s branding with its S7 and S7 Edge stablemates, the new Note7 features an improved stylus, iris-scanning biometric security and a curved screen reminiscent of the S7 Edge. Samsung’s Galaxy Note7 officially went on sale Friday, Aug. 19.

Meanwhile, the industry is patiently awaiting the arrival of Apple’s iPhone 7. According to numerous leaks, the iPhone 6s successor is rumored to have a pressure-sensitive home buttons with haptic feedback and a new dual main camera setup on the larger iPhone 7 model. Stirring a little controversy, Apple is also reportedly removing the 3.5mm headphone jack, favoring pumping audio through the device’s Lightning port and wireless Bluetooth connectivity.

Pedro Hernandez is a contributing editor at Datamation. Follow him on Twitter @ecoINSITE.

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