Daily Tech Snippet: Tuesday, January 25

• Samsung Galaxy Note 7 Crisis Signals Problems at Korea Inc.  With the Note 7, Samsung pushed its business model, as well as its technology, to the limit, according to Samsung officials, who spoke on the condition of anonymity while the Note 7 investigation was being completed. Driven by the desire to prove it was more than a fast follower of Apple, Samsung rushed the Note 7 to market ahead of Apple’s iPhone 7. To fend off Chinese competitors like Huawei and Xiaomi, it packed the phone with new features, like waterproof technology and iris-scanning for added security. But battery scientists, including those who spoke at the announcement, said aggressive decisions in designing the batteries made problems more likely. Pushing to make the battery thinner and more powerful, Samsung opted for an exceptionally thin separator in its battery. As the critical component that separates the positive and negative electrodes in a battery, separators can cause fires if they break down or contain flaws. UL, a safety science company contracted by Samsung to investigate the battery, said the thin separator offered poor protection against defects. It also said that the high energy density of the battery could increase the severity of failures when they occurred. Samsung’s insistence on speed and internal pressures to outdo rivals in part signal a breakdown in the ability to truly innovate and push out new ideas, critics say. In place of big new ideas, Samsung focused on maxing out the capability of components like the battery. That philosophy, which worked to keep Samsung on the heels of the likes of Apple, simply is not as effective as Samsung tries to push ahead, they argue. But for many of the company’s critics, the most interesting part of the presentation was what Samsung did not say: How could such a technologically advanced titan — a symbol of South Korea’s considerable industrial might — allow the problems to happen to begin with? The answer to that question gets to deep shortfalls that former employees, suppliers and others who watch the company say may have contributed to the incident. Samsung, like South Korea as a whole, fosters a top-down, hidebound culture that stifles innovation and buries festering problems, they say. For those critics, these problems have come to light through another front: politics. Samsung has been caught up in a scandal surrounding the country’s president, which they say illustrates a hierarchical culture that tends to micromanage away creativity and insulate family-run business empires from accountability and competition.

• Jay Z is selling a third of Tidal, which makes sense. Sprint is buying a third of Tidal, which makes less sense. Jay Z hasn’t found a new owner for Tidal, his streaming music service. But he’s getting closer. Sprint says it has bought a third of Tidal; Billboard says the carrier is paying $200 million for its stake, which pegs Tidal’s value at $600 million. Sprint and the music service aren’t offering any other details, except that Sprint customers will get “exclusive artist content not available anywhere else” and that Sprint CEO Marcelo Claure will join Tidal’s board. Jay Z has been shopping Tidal for at least a year — Samsung, which seemed like a logical buyer, kicked its tires for a while, then walked away; everyone else gave it at least a look — so it’s logical to assume that this deal gives Sprint a “path to control”: The ability to buy a majority stake in the company over time. It’s also logical to see why he’d want to get out of the streaming business, which he entered by buying Aspiro, a Swedish streaming company, for $56 million in 2015: Everyone in the streaming music business loses money. That doesn’t matter to tech giants like Apple and Amazon, who use music to promote other products. It also doesn’t seem to matter to bigger streaming music companies like Pandora and Spotify, that have investors willing to bet that they’ll figure out how to turn a profit, one day. But if you’re Jay Z and you’re running a small scale streaming business — Tidal claims it has three million subscribers, though those numbers have been disputed — then you’re either funding those losses out of your pocket or getting someone else to do it for you. So an early exit would have always been part of the plan. Here’s a good hunch: In a year or so, Jay Z will have sold the whole thing to Sprint, which will be left trying to figure that problem out for itself.