The IMT-2020 Promotion Group officially announced the results of the third phase of China's 5G technology R&D test, except for the five system-level equipment vendors that have been involved in the test, such as Huawei, ZTE, Ericsson, Nokia and China Trust Group. It is a new communication equipment supplier, that is Samsung, obviously this is a big threat to Huawei, which has a dominant market position in the local market.
The entanglement between Huawei and Samsung
More than a decade ago, there was not much overlap between Huawei and Samsung. The business of the two companies was different. However, since the former officially entered the mobile phone market, the two sides began to form a competitive relationship. The former has repeatedly claimed to be in the smartphone. The market surpassed Samsung. Recently, the former consumer business CEO Yu Chengdong also announced that he would overtake Samsung to become the world's largest mobile phone company in the fourth quarter of next year.
Samsung has been fighting in the mobile phone market for many years. From 2000 to around 2010, well-known mobile phone companies such as Motorola and Ericsson have declined or even disappeared. Samsung’s share in the mobile phone market has steadily increased. By 2012, it officially replaced Nokia as the world’s largest mobile phone company. Nokia’s position as the world’s mobile phone leader has been around for 14 years, and now Samsung’s position as the world’s mobile phone leader is almost seven years away.
Since 2011, Huawei's smartphone shipments have steadily increased. By 2014, it has become the third largest player in the global smartphone market. By the second quarter of this year, it has surpassed Apple to become the world's second largest smartphone brand. This shows that Its strong competitiveness in the smart phone industry. In contrast, Samsung's share in the smartphone market began to decline. In the second quarter of this year, its shipments fell 10.4% year-on-year to 71.5 million units, setting a quarter in recent years. The new volume of goods, which led to its decline in market share is the Chinese mobile phone brand headed by Huawei.
Huawei's rapid development in the smart phone market share will undoubtedly make Samsung stunned. If Samsung loses its position as the world's largest mobile phone brand, it will be a major blow. Huawei started its communications equipment business and is now the world's largest communications equipment supplier. Nearly half of its overall revenue comes from the communications equipment business, and the communications equipment business contributes most of its profits. It relies on the profits provided by the communications equipment business to support its expansion in the smart phone industry. Samsung enters the communications equipment market. It is precisely the effect of burning the war in Huawei's backyard, reducing the enormous pressure it faces in the smartphone market.
Samsung's development in the communications equipment market
Samsung actually entered the communication equipment market as early as 4G commercial, but the final result is that it will once again decide to expand its communication equipment business when 5G is about to be commercialized. First, it has obtained 5G communication equipment orders from a small operator in the UK. In the hands of Verizon, the largest operator in the United States, it won a big single 5G communication device, which represents a good start in the 5G communication equipment market. It has already shouted the goal of capturing more than 20% of the global communications equipment market. This is obviously a huge challenge for Huawei.
At present, due to well-known reasons, China's two major communication equipment vendors Huawei and ZTE are difficult to enter the US, Australia and other markets, which provides an opportunity for Samsung to develop in the communications equipment market. For operators in these two markets, it is clear that they are not It is hoped that only two communication equipment vendors, Ericsson and Nokia, will cause the price of 5G communication equipment to be too high. Samsung has shown that it is willing to adopt a more aggressive pricing strategy in 5G communication equipment in the US market, also because it is The price advantage, the largest operator in the United States Verizon will give most of the 5G communication equipment orders to it.
In the face of Samsung's expansion in the communications equipment market, Huawei certainly did not sit idly. It has announced that it has entered Samsung's domestic market, the Korean market, and hopes to obtain some orders for 5G communication equipment in this market at very favorable prices, but recently the largest operation in South Korea. SK Telecom announced that its 5G equipment supplier wins the list including Samsung, Ericsson, but Nokia does not have Huawei, which is obviously a blow for Huawei. At present, two other Korean operators KT and LG Uplus have not announced their 5G communication. Equipment supplier, Huawei still has the opportunity.
Now Samsung has entered China's 5G technology R&D test list, which means that it has officially entered Huawei's dominant domestic market. Huawei has always relied on its own technology, price, service and localization advantages to have an advantage in China's communications equipment market. Market share, even in 2010, China contributed half of its revenue to its communications equipment business, showing the importance of the Chinese market, if Samsung will gain some market share in China's 5G communications equipment market in the future. It is an amazing progress, and it will be a big blow to Huawei.
Samsung entered the 5G communication equipment market in China, which represents the stage of its fierce competition with Huawei. The two sides began to compete on multiple fronts. The author believes that the current situation should be more favorable for Samsung, and its business is more complicated. And it has advantages in storage chips, CMOS, TV and other services. These advantageous services can provide a continuous stream of ammunition for its communication equipment business; in contrast, Huawei's two main businesses are communication equipment and intelligence. Mobile phone business, if both businesses are suppressed, the prospects are worrisome.