Korean mobile carriers leaning towards Samsung with partnership on 5G

South Korean mobile carriers are ramping up partnerships with Samsung Electronics as part of moves towards completing the country’s first fifth-generation commercial network system amid ongoing biddings joined by global vendors such as China’s Huawei, according to the industry on Tuesday.

SK Telecom, the nation’s No.1 telecom business by the subscriber number, said the company has developed the 5G NextGen Core equipment based on international standards such as the hyper text transfer protocol, a core piece of 5G equipment that enables transmission of data between 5G base stations and internet servers in partnership with Samsung.

“The newest equipment enables ultra-high speed, ultra-low latency in data transmission, which was technically difficult to achieve in the current LTE equipment,” the companies said. 

Financial and biometric data will be transferred via quantum cryptographic channels to ensure security, while high resolution visual and telemedicine data that requires minimal latency will be transferred via an accelerator in the co-developed 5G system by SKT and Samsung.

SKT and Samsung have so far submitted more than 30 cases of 5G systems to 3GPP, contributing to setting global standards, the mobile carrier said.

“The latest 5G equipment can help mobile carriers provide optimal mobile services for contents of customers’ interest.” said Jun Kyung-hoon, executive vice president at Samsung.

Such partnership announcement has been made in the middle of biddings for 5G equipment supply joined by global equipment manufacturers Nokia, Ericsson, Huawei and Samsung.

Korea’s three mobile operators -- SKT, KT and LG Uplus -- are examining 5G technologies and specifications of network equipment proposed by the vendors in order to deploy their 5G base stations. Final bidders are likely to be decided within the third quarter. 

“SKT has been testing 5G equipment not only with Samsung, but also Nokia and Ericsson based on standalone and non-standalone standards,” an SKT official said. 

No particular project or testing has been announced with Huawei yet.

Samsung has been the biggest market player in the Korean network equipment market since the second-generation network, accounting for around 40 percent of the market.

SKT and KT have been using equipment supplied by Samsung, Nokia and Ericsson, while LG Uplus has brought Huawei’s LTE equipment to some parts of its stations in addition to the three other vendor’s systems.

Huawei, the first in announcing development of 5G commercial systems, is now making all-out efforts to provide its systems for SKT and KT in the Korean market.

“It seems like SKT and KT are leaning more towards Samsung than Huawei in the end,” said an industry insider. “The telecom companies have strong pride in the development history of the Korean telecom industry. They are very likely to declare the first completion of 5G network system with Samsung considering the national sentiment, pride, etc.”

Some in the equipment industry say that the telecom companies are seemingly using Huawei as a card to press Samsung to curtail prices.

“It will be hard for the Korean mobile operators to ditch Samsung because of compatibility of the current network systems with new ones,” a source said. “They may be using Huawei to win in price negotiations with Samsung.”

According to the industry, Huawei used to offer about 20 percent lower bid prices than the other bidders for its LTE equipment.

By Song Su-hyun (song@heraldcorp.com)