[THE INVESTOR] Samsung Electronics and Chinese tech firm Huawei have clashed head-on in a bid to provide 5G network equipment to mobile carriers in Korea.
The two companies are competing to win contracts to supply next-generation mobile network equipment to Korean telcos KT and LG Uplus.
Samsung was picked last month as a preferred bidder, along with Ericsson and Nokia, for 5G equipment by Korea’s largest wireless operator SK Telecom.
SK Telecom picks Samsung, Ericsson, Nokia for 5G service
“Huawei will likely go all-out to win the bids this time as there are high stakes involved,” said an industry official who wished to remain anonymous.
Huawei has been embroiled in security issues here as in some other countries, including the US and Europe. Concerned over a public backlash, Korean telcos have been hesitant to partner with Huawei although the mobile network equipment supplier is considered to have an upper hand in 5G technology.
In order to win the deals with KT and LG Uplus, the Chinese company has offered its network devices up to 40 percent cheaper than those made by other rivals while Samsung is also considering to cut its prices, according to sources.
Aiming to commercialize the 5G network next year, major Korean mobile carriers have been speeding up the pace to deploy their mobile network technology.
Although 5G technology is faster than 4G by up to 10 to 20 times, it is more costly to deploy as it has shorter wavelengths and needs more base stations to enable fast and stable data transfer and voice call services
The three Korean telcos are forecast to spend up to 30 trillion won (US$27 billion) to install the 5G facilities nationwide.
KT and LG Uplus are expected to announce the results of their tender this month.
LG Uplus uses Huawei’s equipment for its 4G network in Seoul and surrounding cities while KT has been teaming up with Samsung and Nokia for the 4G coverage.
Telecom companies tend to maintain a partnership with equipment suppliers for a long time to ensure the stability of their network.