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News Brief

As Huawei Reels Under The Impact Of US Sanctions, Samsung Wins $6.6 Billion Verizon Order For Supply Of 5G Network Equipment 

BySwarajya Staff

In a a major win for the company in the next-generation 5G network equipment market, Samsung Electronics announced today that it has bagged a $6.6bn network deal with US carrier Verizon.

South Korean conglomerate said that it has signed a contract with Verizon Sourcing LLC to supply telecom equipment to the US operator till the end of 2025. The size of the deal is roughly equivalent to 3.43 percent of Samsung Electronics' 2019 full-year sales of $206bn.

Samsung is a still a fledgling player in the global telecom equipment market with three percent market share in 2019. According to market research firm Dell'Oro Group, Huawei with 28 percent, Nokia with 16 percent, Ericsson with 14 percent, ZTE with 10 percent and Cisco with seven percent are the leading players.

Samsung’s win comes days after US President Donald Trump dealt a deadly blow to the Chinese behemoth by cut off the company’s access to vital, advanced computer chips.

The US Commerce Department announced fresh sanctions restricting any foreign semiconductor company from selling chips developed or produced using US software or technology to Huawei, without first obtaining a license to do so.

Huawei relies on foreign-made semiconductors to power its 5G telecommunications gear. Huawei has been facing serious trouble in rolling out 5G as several countries have moved to effectively block it from accessing their domestic market.

Last month, the White House and the Department of Defense announced that 100 megahertz of mid-band spectrum will be made auctioned off for commercial 5G deployment. The most active user of mid-band spectrum is the U.S. military, which puts it to work on radar systems, air-traffic technology and other purposes.

The decision of the U.S. government to make more wireless spectrum available for the comes as a huge boost to US telecos like AT&T, Verizon and T-Mobile to advance the with rollouts of 5G technology.

Analysts are of the view that Samsung's global prospects for its network business have dramatically improved following US sanctions on its bigger rival Huawei.