For the well documented semiconductor shortage that is leading to a situation of limited stocks for technology products and cars around the world, we may have just confirmed the first big casualty of this chip shortage. The Samsung Galaxy Note smartphone series may not see a new refresh this year, as the Korean tech giant confirms they are grappling with chip shortage. The Galaxy Note phones, which are extremely popular particularly for the S-Pen stylus that they add to the experience, may very well be put on the back-burner for the time being. The current line-up of Galaxy Note phones includes the Galaxy Note 20 and the Galaxy Note 20 Ultra. This is even though Samsung is one of the leading chip manufacturers in the world.
Samsung executives warned of their fears at an annual shareholders meeting in Seoul. Koh Dong-jin, co-CEO at Samsung, said that the company is considering skipping a new Galaxy Note refresh for this year, a result of what he calls a “serious imbalance” in semiconductor supply globally. This year could very well see Samsung further streamline their Galaxy smartphone line-up, that includes the flagship Galaxy S series, the futuristic foldable phones in the Galaxy Z series as well as the more affordable Galaxy A and Galaxy M series. Samsung may be facing a dual pronged problem—their own Exynos chips may be in short supply, while there is already a shortage of processors made by Qualcomm. Samsung is the world’s second largest chip manufacturer, while Taiwan’s TSMC is the largest—the latter also makes Qualcomm’s chips. “There’s a serious imbalance in supply and demand of chips in the IT sector globally. Despite the difficult environment, our business leaders are meeting partners overseas to solve these problems. It’s hard to say the shortage issue has been solved 100%,” said Koh.
That being said, Samsung may already have a ready alternative in stores for consumers looking to buy a new Galaxy Note phone, with the new Samsung Galaxy S21 Ultra smartphone launched earlier this year. This is the first Galaxy S series phone to support the S Pen functionality, which was unique to and remained the most attractive proposition in the Galaxy Note phones. The new Galaxy S21 flagship series, which includes the Samsung Galaxy S21, the Samsung Galaxy S21+ and the Samsung Galaxy S21 Ultra phones, was released earlier this year. It also gave Samsung the first mover advantage, as they became the first phone maker to release their flagship phones for the year.
The shortages of semiconductors are impacting everyone. In India, there are incredibly long waiting times being quoted by dealerships if you walk in now to book a new car—even longer if the car is very popular and in high-demand. Smartphone makers including Apple have said that sales of new phones have been impacted by the shortage of components. Qualcomm, the world’s largest chipmaker for smartphones and mobile devices, has also said that the industry’s reliance on a handful of semiconductor manufacturers is hurting business.
Samsung’s S2 Fab in Austin, Texas has had to slow down production for large parts of this year so far, due to the extremely cold weather which blew through the state, impacting electricity supply. In February, Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung struggled with manufacturing at their facilities in Taiwan due to a drought in the region. Reports emerging from Taiwan indicate that weather forecasts suggest the dry season may last until May, with March being drier than usual as well.