Electronics Co. will supply its fifth-generation (5G) network equipment to Japan’s KDDI Corp., the country’s second largest telecom company, entering one of the most lucrative network markets in the world. The company will provide US$2 billion (2.35 trillion won) worth of 5G equipment over the next five years. With the deal, Electronics is planning to boost its share of the global telecom equipment market to 20 percent by 2020.
Along with Sweden's Ericsson and Finland's Nokia Corp., Samsung Electronics has been selected by KDDI as the main 5G vendors for next-generation network deployment in Japan, according to industry sources on Sept. 30. "Samsung has won a contract to supply its 5G network equipment to KDDI. However, we cannot confirm the contract value," an official from Samsung Electronics said.
KDDI, the second largest mobile carrier in Japan after NTT Docomo, plans to increase its 5G coverage to 93.2 percent until March next year. The company is also planning to set up about 53,626 base stations across the country by 2023.
Samsung Electronics has jointly conducted 5G tests at the Haneda Airport International Terminal in Tokyo and train stations with KDDI from November last year. Samsung Electronics vice chairman Lee Jae-yong has visited Japan several times to seek business opportunities in the 5G network market. Lee visited the headquarters of KDDI and NTT Docomo in Japan in May as well.
Japan will begin 5G services next year. Its 5G equipment market is estimated at 3 trillion yen (US$27.80 billion or 33.33 trillion won). With the latest deal, Samsung Electronics is planning to make a foray into the global 5G market. Notably, Samsung Electronics is forecast to expand its market share with China’s Huawei, the world's largest telecom equipment supplier which is faltering from U.S. sanctions.