Samsung: Rumors of network sale are 'entirely groundless'

Samsung Electronics flatly denied a recent report that the company is considering the sale of its wireless networks business.

"Some news media have contended that Samsung Electronics is considering to sell its network business, which manufactures mobile telecommunication systems," Samsung said in a statement on its website. "However, Samsung Electronics has no intention to pull out from its network business. Samsung has strong business ties with major operators in the US, Japan, Korea, countries that have a leading LTE (4G) market, and we also have business relations with major operators in South Asia and Europe. Samsung is recognized as an innovative player for developing and commercializing many of the world's first technologies through 2G, 3G and 4G."

Added Samsung: "Samsung will continuously commit to bring advanced telecommunication technologies to the world."

Earlier this week, Light Reading reported that Samsung was considering selling its wireless networks unit, citing unnamed industry sources. At the time, a Samsung spokesman declined to comment. 

Samsung has always been a smaller player in the network gear market, especially when compared to giants like Ericsson (NASDAQ: ERIC), Huawei, Nokia (NYSE:NOK), Alcatel-Lucent (NYSE: ALU) and ZTE. Still, Samsung does count several large carriers as its customers for wireless network equipment, including SK Telecom, Sprint (NYSE: S), Verizon (NYSE: VZ) and Vodafone.

Moreover, the network equipment market has been the scene of massive consolidation. Alcatel acquired Lucent, Nortel Networks shut down and sold off its technologies, and Nokia in the process of merging with Alcatel-Lucent.

Samsung does not break out the financials of its networks division as a standalone unit. However, it does give a hint as to its size. Samsung's IT & Mobile (IM) Communications division is comprised of its handset and tablet business as well as its networking unit. In the third quarter, the overall IM unit had sales of around $23.16 billion (26.61 trillion South Korean Won), and the "mobile" component of that -- i.e. mobile device sales -- made up around $22.57 billion of those sales.

According to IHS, the worldwide macrocell mobile infrastructure market totaled $11.4 billion in the second quarter of this year. The firm said LTE revenue during the period was essentially flat when compared with the previous quarter, but it grew 10 percent from the year-ago second quarter.

For more:
- see this Samsung post

Related articles:
Report: Samsung considering offloading wireless network gear biz
Nokia's Suri: Ericsson-Cisco deal is a 'validation' of decision to buy Alcatel-Lucent
Verizon, Samsung to test enterprise LTE-U femtocells
Verizon to test 5G in 2016