Samsung is much more associated with handsets, consumer devices, and appliances than it is with cellular base stations, but it is clearly working hard to change that. Over the last several years Samsung has been quietly gaining market traction in the wireless infrastructure space.
Based on information supplied by the vendor and other public sources, we believe the company now has eight commercial LTE contracts. Furthermore, if Clearwire gets the necessary funding for its LTE network, Samsung will be part of that build since it is one of the operator’s existing WiMAX base station vendors. In fact, as WiMAX operators in general look to LTE as a long-term network solution, Samsung’s network incumbency with many of those operators should prove to be a benefit.
Sure, other vendors have more commercial LTE wins than Samsung, but for a company that wasn’t much of an entity in the 3G universe, these wins show that 4G, and LTE in particular, has provided Samsung with a new opportunity in the base station market.
Two recent wins stand out. First, Samsung’s work with Sprint on Network Vision shows the company’s ability to participate in a challenging build where multimode (CDMA/LTE) support in a single spectrum band is required. Second, and possibly just as impressive, is Samsung’s small cell LTE win with KDDI in Japan. What makes this project stand out is not just the scale of the deployment, which is reported to be in the range of tens of thousand of small cells, but the fact Samsung isn’t a macro cell provider to KDDI. This shows that the vendor can make its small cell solution work with other third-party macro vendors, allowing Samsung to gain entry into markets where it isn’t the incumbent macro provider.
Yes, Samsung’s device success greatly overshadows its wireless infrastructure success and may actually at times hurt its infrastructure image, with operators seeing the company as a device-first vendor. However, those device assets can also give Samsung an advantage over competitors that don’t have such a tight coupling between these two important parts of the wireless ecosystem.
Take the case of Samsung’s work with MetroPCS in the US. In a recent discussion with Ed Chao, senior vice president of engineering and network operations at MetroPCS, he called out the tight linkage between Samsung’s device and infrastructure solutions as one of the benefits of working with Samsung. He said the vendor could align the development of devices and infrastructure together, leading to quicker time-to-market and fewer interoperability issues for MetroPCS.
Despite its recent success in winning deployment contracts and the advantages that come from its device division, Samsung still has significant challenges to deal with. The company lacks some of the routing and transport solutions of its competitors, hindering its ability to offer a full end-to-end network. Samsung also has not been nearly as active as companies such as Alcatel-Lucent, Ericsson, Huawei, Nokia Siemens, and ZTE in the ICT services space. Furthermore, Samsung’s tight link between devices and infrastructure isn’t totally unique – Huawei and ZTE can make similar claims.
All of these factors may limit Samsung’s overall market success. That said, while it is way too early to see Samsung becoming one of the largest competitors, its recent activity certainly points to a wireless infrastructure vendor on the rise.