Samsung Lands 5G Deal
Samsung won a $6.6 billion dollar deal with Verizon to provide 5G wireless solutions. The agreement is one of Samsung’s biggest contracts since it ventured into the telecom equipment space. Nokia, another large player in the industry, was the main competitor beaten out for the deal and saw its stock slide 2.5% Monday as a result of the announcement.
The deal will elevate Samsung’s market share and threaten the power of current industry leader Huawei. The Chinese tech giant has been caught in the middle of trade disputes between the Chinese and American governments, so this is an important step for Samsung and a missed opportunity for other industry players.
Samsung is currently fourth in market share worldwide, but the success of the deal could draw companies in other countries to do business with the Korean conglomerate. Many telecom businesses are looking for alternatives to Huawei for their 5G network.
While the deal was a setback for Nokia, the company remains optimistic about its future in the 5G space. The company commented that Verizon is still a top three global customer despite not getting this specific contract. The future of 5G will be interesting to watch as geopolitical factors impact the battle for market control.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.