Samsung Electronics Vice Chairman Lee Jay-yong. (Photo: Samsung Electronics)

As the global 5G telecom equipment market is opening in earnest, Samsung Electronics’ Network Business is shining.

Samsung Electronics is predicted to log its best-ever sales this year, in a year when its global market share is expected to double.

Samsung Electronics supplied 5G telecom equipment to SK Telecom, KT and LG Uplus last year for the first time in the world. In April, Samsung Electronics became the first company to release the world’s first 5G telecom smartphone on the market.

Samsung Electronics is benefiting from setbacks of its rivals Huawei of China and Ericson of Sweden. Those companies have suffered from U.S. economic sanctions and a bribery scandal, respectively.

A report released by IHS Market on Dec. 10 showed that Samsung Electronics took a 5 percent share to rank fifth in the global telecom equipment market, trailing ZTE of China, ranked fourth, with 12 percent as of the end of last year.

But things have changed so far this year. As of the end of the third quarter of the year, Samsung Electronics rose to 2nd place with a 23 percent, following the top-ranked Huawei with a 30 percent share. The Korean electronics maker outpaced Ericson’s 20 percent share and Nokia’s 14 percent share.

Samsung Electronics’ Network Business raked in 4.02 trillion won in the first nine months of the year, similar to the whole of last year’s 4.17 trillion won. The business is forecast to log 5.5 trillion won in record sales this year.

Samsung Electronics’ charming performance in the global telecom equipment market is owed to the company’s nimbler steps to brace for the opening of the 5G telecom equipment market.

Samsung Electronics’ Network Business belatedly jumped into the 4G telecom equipment market, so it yielded insignificant results. Samsung Electronics has been waiting with thorough preparation not to repeat the past’s failures.

Samsung Electronics Vice Chairman Lee Jay-yong attended a ceremony to put into operation 5G telecom equipment production lines as he made New Year’s fist inspection tour on Jan. 3. At that time, Vice Chairman Lee said, “(We have to) nurture competitiveness with a challenging spirit to brace for the opening of the 5G telecom market.”

He has been spearheading efforts to win overseas orders. Last year, Samsung Electronics struck a deal to supply 5G telecom equipment to U.S. telecom service providers Sprint and AT&T. Samsung Electronics was also selected to supply Verizon with commercial 5G Fixed Wireless Access (FWA) network solutions.

Samsung Electronics is benefiting from its rivals’ unfavorable factors.

Huawei, the global No. 1 telecom equipment maker, is embroiled in U.S.-Chinese trade conflicts.

The United States is calling for Europe and other countries not to use equipment produced by Huawei, citing security issues. State Secretary Mike Pompeo recently demanded that the U.S. use 5G telecom equipment made by the likes of Samsung, Ericson and Nokia instead of products produced by Huawei.

 
Ericson, the global No. 3 telecom equipment maker, was slapped with 1.3 trillion won in penalties for bribing government officials in countries such as China and Vietnam to win orders between 2000 and 2016.

The business outlook for Samsung Electronics next year is rosy, as countries have been scrambling to push ahead with projects to install value-added high-frequency, 28GHz 5G networks.

This year, telecom service providers around the world began to install low-frequency, 3.5 GHz 5G network, but next year, more companies are expected to make massive investments to install 28GHz 5G network, which is considered essential for the introduction of self-driving car and smart factory.