We sat on the sofa and looked down at the table. L6 was placed on the table.
"This one was definitely made well."
Economist Keynes said on said:
In the long run, all humans die.
If you apply this to a cell phone, it will look like this:
"In the long run, all phones will be discontinued."
Therefore, the latest phone, the L6, will also be discontinued someday.
The important thing is······.
"For what reason and when will it be discontinued?"
I played around with L6. Unlike before, nothing came to mind. I looked around, but didn't see any problems.
"Did you encounter anything strange while using it?"
"Far from being better, it's the best phone I've ever used."
"Are any of Seosung Electronics' smartphones discontinued due to problems?"
Taekgyu shook his head.
"Not as far as I know. And even if there is a problem with the phone, They provide repairs or compensation. It makes no sense to discontinue the product."
That is correct.
Unlike feature phones that only made calls and text messages in the past, smartphones are a product that combines portable electronic devices such as laptops, MP3 players, and cameras.
A smartphone contains tremendous functions, and as functions become more complex, various problems arise constantly in software and hardware.
If a product was discontinued every time a problem arose, all manufacturers would have had to close down.
"From the manufacturer's perspective, there is no way they would do anything that would result in a loss."
Why on earth would a popular smartphone be discontinued?
* * *
That night.
While I was sleeping on the sofa, I suddenly heard screaming coming from inside the room.
"Ugh!"
"What!, what?
Startled, I got up and ran to the room.
Quang!
The door opened wide and Taekgyu ran out of the room. He looked distraught and couldn't even wear his glasses properly because of what had happened.
"what's the matter?"
"Something exploded in my room."
I was dumbfounded.
"What bullshit? "Did you have a dream?"
"Oh, no. I heard it really exploded.Do I okay? "Are my eyes or ears blown off?"
"······."
His mental state doesn't seem to be very healthy.
I went into the room and turned on the light. Surprisingly, what Taekgyu said was true. The bed pad was scorched and embers were burning little by little.
"hey! "Bring water!"
Taekgyu took out bottled water from the refrigerator, and I poured it on the bed.
Chi-ik!
It wasn't a big fire, so I sprinkled water on it and the fire went out quickly.
What is this happening right now?
I looked for the cause of the fire. I didn't have to look much. This is because there was a black, melted cell phone in the middle of the burned pad.
When I brought my hand closer, It felt hot.
Taekkyu said while looking at his cell phone that was barely holding its shape.
"what? "Did the L6 explode?"
I asked Taekgyu.
"What did you do to your phone?"
"I didn't do anything. "I just plugged in the charger."
According to Taek-gyu, he played games on his phone before going to bed, and plugged in the charger right before going to bed. And while he was sleeping well, this suddenly happened.
"But why did it explode?"
"I don't know either."
I looked at the charger. The charger was a genuine Seosung Electronics product and there seemed to be no disconnections or other problems.
Why on earth did this happen?
Taekkyu said, holding his still beating heart.
"What kind of phone explodes a week after you buy it? "What kind of bomb is in it?"
"bomb?"
We looked at each other's faces.
"no way······?"
* * *
Taek-gyu sat in front of the computer and searched internet sites.
"There were several explosions before this one."
The first post was posted three days after it was released.
It all started when a photo of an exploded L6 was posted on an internet community called 'Pompujil'. The victim claimed that the cell phone exploded for no reason while charging.
Seosung Electronics responded quickly and reached an agreement with the victim, so the case was quickly resolved. However, since then, similar posts have been posted several times on blogs and Facenote.
I just checked it on the Internet and it had been reported three times.
"If I count you, does it count four times?"
"If you include the unknowns, there will be more."
From the manufacturer's perspective, they do not want quality controversies to arise. Therefore, it is not surprising that silence was requested on the condition of cash compensation, etc.
"What does Seoseong Electronics say is the cause?"
"They say it's because of external shocks. "Actually, it's not that rare for a cell phone to explode."
Taekgyu explained.
Most electronic devices, including cell phones, use lithium-ion batteries . This is because the energy density is high compared to the volume, making it efficient.
However, lithium ions have the property of exploding when shocked. In fact, it is not uncommon for cell phones produed by NPL and other manufacturers to explode.
The problem is the ratio.
There is a clear difference between one in 1 million units exploding and one in 10,000 units exploding.
Is this really due to an external shock?
We searched articles and posts on social media about Seosung Electronics and L6 all night long.
There were several explosions and a few minor problems such as voice recognition and screen brightness, but they had no significant impact on L6 sales.
CL Electronics also released Prime 5 around the same time, but it was pushed out by L6 and was not able to see the light of day.
Until NPL releases NPhone 7, there was a high possibility that it would dominate.
We also looked at explosion cases from other companies, but the explosion rate of L6 was clearly overwhelmingly higher than that of other phones.
Was there something wrong during the manufacturing process?
Is it possible for Seosung Electronics to make a mistake that even small and medium-sized companies would not make.
Unlike me, who thought calmly, Taek-gyu was anxious.
"This is an opportunity. "We have now obtained tremendous information."
"wait."
"Why are you waiting? "We have to move a little faster."
Taek-gyu said as if he was frustrated.
"And what if Seosung Electronics announces the discontinuation of the product first? Then everything will go away."
Selling Bantcoin was not an investment but an action to avoid risk. Even if Mountain Hill's bankruptcy did not materialize, there was nothing to lose. WTI purchases amounted to only $3 million, a fraction of assets.
But this time the case is different.
If we had only invested $2 million or $3 million like last time, I wouldn't have worried this much.
Even if it is certain that a product will be discontinued, it does not immediately lead to profits. You need to understand the timing of product discontinuation and the impact it will have, and decide on an investment method.
I spoke carefully.
"Let's wait and see the situation for a few days."
* * *
next day.
Taek-gyu called the after-sales service center and reported the L6 explosion. Immediately afterwards, an employee came running to the house.
Not everyone who wears the Seosung Electronics uniform and repairs Seosung Electronics products is an employee of Seosung Electronics. Most of the after-sales service center employees were subcontractor employees.
However, the person who visited the house was an employee from the head office, not a subcontractor employee.
I asked the employee.
"What caused the explosion?"
The employee answered cautiously.
"I will tell you after the investigation."
The employee collected the exploded L6 and handed over a new product. And he brought up the topic of cash compensation.
There was one important condition to receive full compensation. The request is to refrain from posting articles or photos related to this incident on the Internet until the results of the investigation are released.
The employee asked as if making an apology.
Taek-gyu said he knew and sent the employee away.
"I guess there were quite a few similar incidents."
The staff did not panic even after seeing the burnt and melted L6 and acted according to the prescribed manual.
"The actual L6 that has exploded will be several times more than what was posted on the Internet."
If it is simply a device problem, it ends with repair or replacement and does not lead to discontinuation of the product. But an explosion is a different story.
The most important thing in electronic products is stability.
Cell phones are particularly sensitive when it comes to safety issues. This is because it contains important information such as photos and contact information, and you always carry it with you.
In Taekkyu's case, it was a disaster because it exploded while he was lying next to it. If it had exploded while he was playing a game or talking on the phone, he would have suffered serious burns.
If explosions continue as they are now, it is sufficient as a reason for discontinuation of the product.
Currently, Seosung Electronics' market capitalization is 260 trillion.(around 280 billion dollars )
Annual operating profit is approximately 30 to 35 trillion won, generated evenly across the semiconductor, display, CE, and IM sectors.
The IM division, which includes smartphones, accounts for 40 percent of this operating profit.
"If the L6 is discontinued, will 40 percent of operating profit be lost?"
I shook my head at Taekgyu's words.
"There is also a mid-priced lineup, so it won't be that bad. "There are also previous generation models."
Unlike NPL, which only releases one or two premium phones a year, Seosung Electronics releases a variety of models, from premium phones priced at over 1 million won per unit to low-priced phones priced at less than 300,000 won.
The L series is the main product in the domestic market, but in emerging markets with low incomes, low-priced phones are mainly sold.
Even considering all these factors, the discontinuation of L6 will be a huge blow to Seosung Electronics.
I asked Taekgyu.
"How many countries was the first release in?"
"Korea, the U.S., Canada, and Europe… wouldn't it be about 10 countries?"
"What are the sales volume?"
"It's probably about 6 million units."
They really sold a alot.
If a product is discontinued due to an explosion, not only will it not be able to be sold in the future, but all items sold so far will have to be refunded.
If the price is 1 million won per unit, the refund amount alone is 6 trillion won.
If you take into account the profits that could have been made by continuing to sell and the decline in brand value, the losses will increase several times.
If the information is correct, We hava a massive opportunity.
* * *
Even if the discontinuation of the L6 is certain, the problem begins now.
If you expect a specific stock to rise, just buy that stock. If you are more confident, you can use credit or attempted credit.
But what if you expect a particular stock to fall?
In this case, investment methods are bound to be limited.
Tekgyu said as if it was obvious.
"Isn't there a short sale for times like this?"
"Of course."
There are two ways to short sell.
One is to borrow stocks and then sell them, and the other is to sell stocks that do not exist. The former is leveraged short selling, and the latter is non-leveraging short selling.
Currently, unleveraged short selling is prohibited in Korea, and only leveraged short selling is possible.
In theory, even individual investors can short sell. However, access methods are limited, so in reality, only institutions and foreigners can access it.
However, OTK Company is an overseas corporation. And the OTK Company account is connected to Golden Gate. Therefore, Taekgyu's funds are classified as foreign.
He is a so-called black-haired foreigner!
A black-haired foreigner refers to an investor who, despite being Korean, establishes a corporation overseas and disguises himself as foreign capital to invest in the Korean stock market.
Although it is not illegal, individual investors do not like them very much. This is because it is thought to be a force that disrupts the stock market (and this is partly true).
Short selling itself is not that difficult.
If typical stock investing is buying and then selling. The only difference with short selling is that you sell first and then buy.
"The problem is the rate of return..."
The return on short selling can never exceed 100 percent.
Even if you short sell a stock worth 1 million won and buy it back for 10,000 won later, the return is only 99%.
Thinking calmly, there was no possibility that Seosung Electronics stock would plummet that much. Even if the discontinuation of L6 becomes a reality, the decline rate will only be 20 to 30 percent.
"If we invest 13 billion won and do our best, we will only make 3 or 4 billion won?"
This alone is a huge profit.
But is this really all there is?
Should I be satisfied with this great opportunity with this much profit?
Is there any way to earn greater profits?
I was thinking hard about it, Taekgyu said.
"What about futures options?"
It's not that I haven't thought about it.
"I don't know much about derivatives."
"Didn't you learn it in college?"
"I only went there for one year."
You must be in your 3rd or 4th year to take courses related to futures options.
"What about the investment club?"
"The investment was 1 million won, would you have tried it?"
It is impossible to even access the futures and options market with that kind of money.
But currently our funds are $12.5 million. It's not my money, but I have a large amount of investment money in hand.
At this level, it's worth giving it a try.