Subscribers in the United States will not be left without 5G networks. Samsung will supply equipment instead of Huawei
Finding a replacement for Huawei Technologies’ equipment turned out to be not so easy for many telecom operators since the Chinese company controls 28% of the market. European Nokia and Ericsson, which together control about 29% of the market, cannot cover all former Huawei customers, so for Samsung Electronics, the contract with Verizon was a natural consequence of American sanctions.
As Samsung Electronics announced at the beginning of the new week, the American telecom operator Verizon Communications signed a $ 6.6 billion contract with the Korean company, implying the obligation to be the first to supply and maintain equipment for 5G networks for a period from June 30, 2020, to December 30, 2025, inclusive.
Although Samsung has some advanced developments in the field of information transfer in 5G networks, it could not achieve a significant share in the market of specialized equipment. The company is not one of the five largest suppliers, the share of Samsung’s core revenue does not exceed 1.8%. It must be assumed that such a deal could not have taken place without sanctions against Huawei, so the contract with Verizon can be considered one of the examples of Samsung benefiting from the tense relationship between the United States and China.
Under pressure from the first country, European allies began to refuse to use Huawei equipment in their networks. All competitors of the Chinese giant, even the smallest, can benefit from Huawei’s problems in a situation of active expansion of 5G networks. The UK authorities, for example, are considering the possibility of involving Japanese telecom equipment manufacturers in the development of national 5G networks. Local telecom operators are obliged to stop using Huawei products by the end of 2027.
