Samsung seeks to capitalize from Huawei's sordid reputation

Samsung seeks to capitalize from Huawei's sordid reputation
Huawei is the largest networking equipment supplier in the world. But with its reputation sullied by a bank scandal, technology theft and its founder's pledge to support the communist Chinese government, it is no wonder that many countries are thinking about banning the use of Huawei's networking gear for the build out of new 5G networks. In the U.S., where Huawei is considered a national security threat by lawmakers, President Trump plans on banning the use of any Chinese networking equipment by U.S. carriers.

The fear is that technology from Chinese companies contain back doors that spy on companies and consumers, and send this purloined information to the Chinese government. In China, companies like Huawei and ZTE are required to assist the communist regime with its intelligence gathering operations. While Huawei has denied the allegations numerous times, it recently was charged criminally by the U.S. Justice Department for stealing robotic technology belonging to T-Mobile. The wireless operator previously won $4.8 million from Huawei in a civil suit related to the same offense.

But one company's problems is another company's opportunity. According to Reuters (graph from Bloomberg) Samsung is budgeting more money for its networking equipment business, seeking to take advantage of the security fears that surround Huawei, ZTE and other Chinese firms. This information reportedly comes from Samsung officials and industry executives. For example, the report says that Samsung will invest $22 billion over three years into 5G equipment and other new technologies such as artificial intelligence, biopharma and automotive electronics. Huawei says that it welcomes the competition. Besides Huawei, other top tier suppliers of networking gear include Nokia and Ericsson.

There are some big name wireless firms interested in Samsung's 5G networking equipment. French carrier Orange, which is usually supplied by Huawei for its networks, will run its first 5G tests using Samsung equipment early this year. Usually, most carriers looking to build out their next-gen 5G networks would stick to the outfits they used for their 4G LTE pipelines and upgrade existing equipment; this saves the wireless firms some money. But the U.S. is pressuring other countries to stay away from Huawei and the company's technology is banned in Australia and New Zealand. Other European countries could follow suit.

And Samsung is ready to step in. As one source from inside the company said, "We’re bolstering our network business to seize market opportunities arising at a time when Huawei is the subject of warnings about security."

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19 Comments

1. antroid

Posts: 370; Member since: Jan 24, 2018

Well, it was just a matter of time till other companies will capitalize from Huawei's decent. IT will be hard for them to gain the trust that they once had

2. meanestgenius

Posts: 21453; Member since: May 28, 2014

It’s going to be an uphill battle for Samsung on this front. Sure, they have the money and resources, but it will be hard for them to surpass some other network equipment companies like ZTE, Nokia and Ericsson, which have the benefit of more experience and connections in this field. I could see one of those three capitalizing before Samsung does. But competition is good, and this will undoubtedly spur the market leaders to bolster their efforts.

4. hemedans

Posts: 746; Member since: Jun 01, 2013

Dont forget patents too, No one can match Nokia and Ericson in that area.

5. meanestgenius

Posts: 21453; Member since: May 28, 2014

I agree. In all likelihood, the others companies in this field are probably paying those two in order to license their IP related to this field.

11. mootu

Posts: 1408; Member since: Mar 16, 2017

Ericsson may have experience but they are not perfect. Recently they left 35 million people in the UK without internet for 2 days because they "forgot" to update a security certificate. It actually took them 2 days tigure out why the O2 network was down. They can't afford mistakes like that with 5G due the types of devices that will be connected to it such as self driving cars.

18. meanestgenius

Posts: 21453; Member since: May 28, 2014

For real? LMAO! Not that it's funny, but dam, what a blunder! But no entity is perfect, but they do have the high ground over Samsung in this.

3. drunkenjay

Posts: 1645; Member since: Feb 11, 2013

fix title please. reputration = reputation.

6. smacsteve

Posts: 86; Member since: May 16, 2012

"Reputration"? Are you serious PA?!!

7. dimas

Posts: 3286; Member since: Jul 22, 2014

Go samsung, make more jobs and competition. I just saw this article and the bold statements made me laugh. Huawei is so full of themselves right now: https://www.bbc.com/news/business-47224460

9. Tsepz_GP

Posts: 1134; Member since: Apr 12, 2012

They do make the best equipment, so they are not wrong with that ad.

10. dimas

Posts: 3286; Member since: Jul 22, 2014

Best equipments? So that's why our huawei wifi routers have to be replaced 3 times back in 2016. Our provider went tp-link and we still use the same router until now.

12. mootu

Posts: 1408; Member since: Mar 16, 2017

He's right Huawei's 5G equipment is superior, you may not like that but all the network providers and governments know this. Thats why most are resisting the pressure from Trump, they don't want to be investing billions in lower grade tech.

13. dimas

Posts: 3286; Member since: Jul 22, 2014

Jeez, you're still spewing that crap mootu? The only reason huawei is favored in networking system is because of their cheap bidding estimates, politicians from developing countries love their costing because they can "slide" mark-ups for their personal use. The wolf of chinese equipments even admit commiting bribery just to win biddings. Even their midrange phones have crap quality. Ultra cheap materials for cheap price.

14. mootu

Posts: 1408; Member since: Mar 16, 2017

Is that why Deutsche Telekom have said not using Huawei for Europes networks would set back Europe by 2 years. Is that why Germany are refusing to ban Huawei? https://www.bloomberg.com/news/articles/2019-02-07/german-government-said-to-rule-out-huawei-ban-in-5g-expansion A bit more reading for you, it's just network operators claiming Huawei networking equipment is superior. https://www.thenews.com.pk/latest/418545-better-than-ericsson-nokia-and-samsungs-5g-europe-ignoring-calls-for-huawei-boycott

17. Tsepz_GP

Posts: 1134; Member since: Apr 12, 2012

Hit him with the hard facts, nice one. Yep, they invested $billions in R&D, and even this major smear campaign the US government is trying build is not going to stop them as they do have the most advanced equipment for 4G and 5G. Banning their equipment would set some networks many years behind, stopping Huawei would actually stifle innovation as they have so much R&D in networking and infrastructure.

8. Neoberry99

Posts: 66; Member since: Jun 30, 2015

I don't blame Samsung trying to capitalize on Huawei bad reputration.

16. lyndon420

Posts: 6491; Member since: Jul 11, 2012

"reputration" ??? That's a word that I will find in the scrabble dictionary...yes? So busy pumping out articles...but life gets in the way of proofreading...

19. D34ever

Posts: 218; Member since: Jul 14, 2018

Samsung won't succeed in beating any of the Chinese OEM. They have the same problem as Apple. Their ego is too big.

20. VasiliS7

Posts: 192; Member since: Jan 10, 2017

Huawei stole Samsung's mobile market share, time for Samsung to stole Huawei's network market share. But who cares about mobile. Nobody have profit ftom mobile. Huawei have a childish behaviour to beat Samsung but the same time loses reputation in most profitable market. Huawei is not a serious brand hands down

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