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Samsung mentioned on Monday it had received a $6.64 billion (roughly Rs. 48,570 crores) order to supply wi-fi communication options to Verizon within the United States, a significant win for the South Korean agency within the next-generation 5G community market.
Samsung’s international prospects for its community enterprise have improved following US sanctions on its greater rival Huawei, analysts mentioned.
Verizon CEO Hans Vestberg advised CNBC in July final yr that Verizon doesn’t use any Huawei tools. Verizon had already been a Samsung buyer earlier than the order.
Verizon is believed to be Nokia’s greatest buyer, JP Morgan analysis mentioned in a July word.
“Samsung winning the order from Verizon would help the company expand its telecom equipment business abroad, potentially giving leverage to negotiate with other countries,” said Park Sung-soon, an analyst at Cape Investment and Securities.
The order is for network equipment, a Samsung spokesman said. The company declined to comment on detailed terms the contract such as the portion of 5G-capable equipment included.
“With this newest long-term strategic contract, we’ll proceed to push the boundaries of 5G innovation to boost cellular experiences for Verizon’s clients,” Samsung said in a statement.
Samsung said in a regulatory filing the period of the contract, which Samsung’s US unit signed with Verizon, is from June 30, 2020, to December 31, 2025.
Samsung had a three percent market share of the global total telecom equipment market in 2019, behind No. 1 Huawei with 28 percent, Nokia’s 16 percent, Ericsson’s 14 percent, ZTE’s 10 percent and Cisco’s seven percent, according to market research firm Dell’Oro Group.
The Trump administration last month unveiled plans to auction off spectrum previously dedicated to military purposes for commercial use starting in mid-2022, to ramp up fifth-generation network coverage in the US.
The next-generation 5G wireless network is expected eventually to connect and enable high-speed video transmissions and self-driving cars, among other uses.
Britain in July ordered Huawei equipment to be purged completely from its 5G network by the end of 2027, adding it needs to bring in new suppliers like Samsung and Japan’s NEC.
Samsung Electronics shares rose two percent compared to the wider KOSPI’s 0.5 percent climb.
© Thomson Reuters 2020
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