Sunday Snapshot 09/04/16

Appetite for risk: Two companies have that aspect of their business top-of-mind this holiday weekend, for very different incidents that led to very similar end results for some of their products. One of Tesla's Falcon 9 rockets exploded during a preparatory exercise ahead of a launch which was originally planned for yesterday; Samsung, meanwhile, responded to scattered reports of Galaxy Note 7 devices exploding due to apparent battery issues with a full-scale, voluntary recall.

The unrelated incidents raise a number of questions about risk in technology, namely around who's willing to accept how much, and under what circumstances. Samsung's recall is both significant in scale and a case of serious bad timing: It spans all 2.5 million Note 7 devices shipped so far, and it comes just before Apple looks set to launch its own next-generation iPhone at an event September 7.

According to the company, the incidents have been limited in number – only 35 faulty batteries were uncovered by an internal Samsung investigation so far. Yet Samsung wasn't willing to risk the possibility that these were isolated production line errors that would affect less than one percent of customers. It moved swiftly to institute the recall, because the stakes were higher still if any further incidents occurred. Images of destroyed Samsung smartphones with damage that clearly looks like it affect customer safety have an outsized impact on the company's brand and reputation, regardless of the actual scope of the problem in a pie chart or spreadsheet.

For SpaceX, the percentages work out far less favorably on paper, but appearing over-cautious and taking action that errs on the side of a conservative course would actually probably be more damaging to its business long-term. SpaceX has yet to conclude its investigation into the cause (and probably won't release full results for at least a month or two) but it's already actively reassuring the public and customers that it still has two-thirds of its active launchpads available, and it intends to stick to its existing launch schedule as closely as possible. But SpaceX has won clients because it can effect rocket launches with a frequency and a cost that were previously unheard of.

Samsung, too, wants to get its product back to customers as fast as it can – the smartphone maker's recall program will allow users to either wait for a replacement Note 7, which it says should start shipping out "as early as next week," and affected buyers also have the option to get an S7 or S7 Edge instead, and be refunded the difference in cost. And SpaceX also emphasizes safety as the number one concern in their response, too – but specifically "to safely and reliably return to flight," rather than as an end-goal divorced from its customer deliverables.

The action and response by both SpaceX and Samsung to these incidents, both of which have the potential to dramatically undermine customer confidence in their brands, are both surprisingly similar and yet notably distinct. SpaceX's forward-thinking focus on its launch manifest reflects a customer base relatively comfortable with risk; Samsung's immediate action was to reduce its customers' risk exposure as quickly as possible, which is the smart move when you're dealing with everyday people, rather than military generals and rocket scientists.