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Samsung is near an agreement to fabricate Huawei 5G chips

Tuesday, June 16, 2020

As to media reports that Samsung and Huawei are considering a deal in which Samsung will help make 5G equipment semiconductor chips for Huawei, Chinese analysts said there is a 50-50 chance a deal could be reached.

Huawei and Samsung were considering a deal in which the latter would make advanced chips for Huawei's top 5G gear, while Huawei would cede a significant share of its smartphone market share to Samsung, the Asia Times reported.

Ma Jihua, a veteran industry analyst and a close Huawei follower, told the Global Times Sunday that Samsung could "help" Huawei manufacture 5G-related chips, as Samsung may take the chance to grow rapidly amid the US government' crackdown on Huawei, and there is a real possibility that Samsung could do Huawei a "favor".

The precondition of the reported Samsung-Huawei deal is that mobile phones are Samsung's flagship business, but contribute relatively little to Huawei's profits, whilst Huawei's core business remains telecommunications equipment, according to the Asia Times.

A 5G industry insider, who declined to be named, told the Global Times that there is a 50-50 chance that the deal could be reached, but not by ceding Huawei's mobile phone market share. "The reported condition of the deal is more likely an eye-catching hypothesis instead of a credible report," the insider said.

Richard Yu, CEO of the Huawei Consumer Business Group, expressed Huawei's business prospects on Thursday at a media interview, saying Huawei is expected to have the world's largest market share in two years due to its technology and innovation capabilities.

"Killing Huawei is probably not the real purpose of the US government, but it wants to contain China's semiconductor industry growth by preventing Huawei from developing semiconductors," Ma said, adding that the US will be happy to see that China will rely on Samsung semiconductors, which means that China's semiconductors will keep lagging behind.

Huawei and Samsung didn't reply to the Global Times.

By: DocMemory
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