SEOUL, Sept. 7 (Korea Bizwire) — Samsung Electronics Co., South Korea’ leading tech firm, on Monday said it will supply network equipment to U.S. telecommunications giant Verizon for 7.89 trillion won (US$6.6 billion).
Samsung said it will supply network solutions, including 5G, for the next five years until Dec. 2025.
Samsung’s latest contract with Verizon is the largest network equipment supply deal secured by a South Korean company. The total is equal to 3.43 percent of Samsung’s sales in 2019.
Samsung has been especially trying to expand its 5G equipment customer pool in recent years. In addition to leading U.S. telecom service providers such as AT&T and Sprint, the company has inked 5G equipment contracts in Canada, New Zealand and Japan.
Industry insiders said the deal with the top U.S. telecom operator will serve as a reference for Samsung to secure more network solutions orders in other major markets.
Samsung, along with other local companies, helped Seoul launch the world’s first commercial 5G network in April of last year.
The tech giant said that it has been able to get 40-60 percent of its 5G-related parts from local vendors, which could help smaller companies make inroads abroad down the line.
“The latest long term partnership deal with Verizon will provide users with enhanced mobile experience with Samsung committed to furthering innovation in 5G,” a company representative said.
He said the contract with Verizon comes at the right time as it can help the domestic information technology industry and bolster the job market that has been hard hit by the coronavirus pandemic.
The U.S. is the world’s largest mobile telecommunications market, with its infrastructure spending accounting for about a quarter of the global network investment.
With the U.S. pressuring China’s Huawei Technologies Co., the world’s top 5G equipment supplier, over security reasons, industry observers predicted that Samsung can further expand its presence in the 5G equipment market.
According to market tracker IHS Markit, Huawei was the leading player in the global 5G equipment market last year with a 26.2 percent share, followed by Sweden’s Ericsson with 23.4 percent and Samsung with 23.3 percent.