China Races Ahead of the U.S. in the Battle for 5G Supremacy + 5G to stimulate US$500B in China tech growth over next 5 years (CAICT)

Bloomberg: China Races Ahead of the U.S. in the Battle for 5G Supremacy

by Sheryl Tian Tong Lee –with assistance from Ed Ludlow (emphasis added by Alan J Weissberger)

In the race for tech supremacy, China is betting it can seize the lead by building the world’s biggest 5G wireless networks.

To get there, the country is banking on the might of the one-party state, making sure its state-run carriers have access to cheap airwaves and fast, inexpensive approvals for putting up the hundreds of thousands of base stations the fastest wireless technology requires.

As top phone companies elsewhere flinch at the cost of building 5G wireless networks, China’s operators are barreling ahead on the government’s mandate, virtually free airwaves and equipment at less than half the price U.S. carriers are paying. Being the first to reach massive scale with the speediest networks could also help the nation in its ambition to dominate industries like factory automation, robotics and autonomous driving.

“5G is a foundation and catalyst for reinventing industries,” said Paul Lee, U.K.-based head of research for technology, media and telecommunications at Deloitte Consulting. “The fundamental benefit of being the first mover is that you can build business models on the back of that and export them to other countries.”

As top mobile carriers elsewhere flinch at the cost of building 5G wireless networks, China’s telecoms operators are barrelling ahead on the government’s mandate, virtually free airwaves and equipment at less than half the price US carriers are paying. Photo: Reuters

As top mobile carriers elsewhere flinch at the cost of building 5G wireless networks, China’s telecoms operators are barrelling ahead on the government’s mandate, virtually free airwaves and equipment at less than half the price U.S. carriers are paying. Photo: Reuters

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South Korea’s wireless carriers were the first to offer commercial 5G services, with SK Telecom Co. launching its network in April and Samsung Electronics Co. already offering a 5G-enabled smartphone. But while U.S. carriers in cities like Minneapolis and Chicago have the beginnings of 5G offerings, it’s in sheer scale where China is on course to edge ahead over the next five years.

That size advantage is also reflected in China’s push to invent 5G technology.

The country’s biggest companies have already established a lead in patents related to the fastest network technology. Huawei Technologies Co., the contentious Chinese firm that’s at the heart of current U.S.-China tensions, leads the pack as the world’s biggest telecom equipment supplier. Meanwhile, ZTE Corp., which has also drawn America’s ire in the past, comes in at No. 3, according to Berlin-based patent information platform IPlytics.

But that won’t necessarily translate into network domination. China’s three carriers — China Mobile Ltd., China Unicom Hong Kong Ltd. and China Telecom Corp. — are all state owned.

Harvard Business School economist Shane Greenstein says having a bigger government role in 5G may not provide an advantage.  “The private firms in China in the digital sector have an admirable record with experimentation,” he said. “The state-owned enterprises? That is a more open question.”

Where the government is helping is by holding carriers’ costs down. Beijing is providing the bandwidth for 5G networks almost for free, said Edison Lee, head of telecommunications research at Jefferies Hong Kong Ltd.

U.S. carriers, by contrast, bid $2.7 billion at two auctions of 5G airwaves, according to the Federal Communications Commission. In India, the industry group representing carriers says its members can’t afford spectrum the government expects to auction for about $84 billion this year.

China’s operators will also pay less for base stations. The units will probably cost about $30,000 each in China, less than half the $65,000 average in other developed-economy markets, Jefferies’ Lee estimates. Two of China’s carriers have said they will lease the equipment, cutting the upfront cash outlay to roughly $6,500 each per year, Lee said.

In the U.S., where the government is leaving 5G to companies, carriers will also pay at least five times more than Chinese operators for civil engineering and permits to build 5G, Deloitte Consulting estimates.

The world’s most populous country has about 350,000 5G-operable base stations deployed, nearly 10 times as many as in the U.S., according to a U.S. Department of Defense study.  The report says China claiming the position of standard-setter for 5G, with Huawei leading rival telecom equipment makers, is a risk for the U.S. This “will create serious security risks for DoD going forward if the rest of the world accepts Chinese products as the cheaper and superior option for 5G,” said the report.

Concern about China’s edge prompted President Donald Trump to float a proposal last year for the government to build a secure 5G network, people familiar with the matter said at the time. The idea was dropped immediately after regulators, industry leaders and elected officials immediately pushed back, saying companies were in a better position to move the technology forward.

The idea of China securing that advantage is also stoking concern among competitors beyond the telecommunications equipment and wireless services industries.

Chip maker Qualcomm Inc., for example, is urging the U.S. and other Western governments to embrace 5G more rapidly or risk falling behind China in the potentially life-saving technology, which is also used in self-driving cars.

China will be “saving hundreds if not thousands of lives much sooner than we will as we fumble to determine which is the standard that is best for the long-term road map in the Western world,” Qualcomm Senior Vice President Patrick Little said in an interview.

While China’s autonomous driving infrastructure lags behind the U.S., where firms like Alphabet Inc.’s Waymo LLC are streaking ahead in real-world testing, Chinese companies are developing related 5G applications with some established car makers.

ZTE is conducting 5G tests on self-driving cars, and has cooperated with Audi AG’s China unit to develop “internet-of-vehicles” technology. In robotics, ZTE is working with internet giant Baidu Inc. and Siasun Robot & Automation Co. to develop 5G applications.

Byton Ltd., an electric-vehicle startup based in Nanjing, will release an SUV in China at the end of this year that includes a range of artificial intelligence functions and a roof antenna that offers data transfer rates up to 10 Gbit a second, which it says is hundreds of times the normal average bandwidth.

The benefits of setting 5G standards may also help China outside its borders. President Xi Jinping’s Belt and Road Initiative includes a push for Chinese-built network infrastructure across the length of a route that runs across Eurasia, the Middle East and parts of Africa.

“Developing countries that are more sensitive to cost will find the Chinese 5G price-point difficult to turn down, especially when the offer is sweetened with infrastructure and project-financing incentives like the Belt and Road Initiative,” the U.S. Department of Defense report said.

For its part, the U.S. is letting the private sector guide 5G development, Federal Communications Commission Chairman Ajit Pai said in a June speech to wireless executives in New York.

“For all this talk about our government’s focus on 5G, make no mistake that we are pursuing a market-based strategy to promote 5G development and deployment,” Pai said.

And the U.S.’ crackdown on Huawei, cutting it off from components made by American companies, will be a big test of China’s 5G lead, says Anthea Lai, Asia Pacific media, technology and telecommunications analyst for Bloomberg Intelligence.

“Before Huawei’s ban, China had strong potential to lead in standalone 5G,” Lai said. “But now we have to see how much Huawei can keep its carrier business intact,” she said.  “Huawei could slow China down.”

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To contact the reporter on this story: Sheryl Tian Tong Lee in Hong Kong at slee1905@bloomberg.net

To contact the editors responsible for this story: Dave McCombs at dmccombs@bloomberg.net, Jason Clenfield

©2019 Bloomberg L.P.

Original article at: https://www.bnnbloomberg.ca/china-races-ahead-of-the-u-s-in-the-battle-for-5g-supremacy-1.1296079

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From South China Morning Post: 5G to stimulate US$500 billion in China tech growth over next five years

At the Global Mobile Internet Conference held in the southern coastal city of Guangzhou on Saturday, a representative from the China Academy of Information and Communications Technology (CAICT) forecast that 5G will stimulate growth in the country’s information technology industry by 3.3 trillion yuan (US$479 billion) over the next five years.  That development is expected to rev up digitization across traditional industries, which would yield more than 10 trillion yuan in growth over the same period.

China Telecom technicians set up a 5G base station near the Yellow River in Lanzhou, capital of Gansu province in northwestern China, on May 16, 2019. Photo: Reuters

China Telecom technicians set up a 5G base station near the Yellow River in Lanzhou, capital of Gansu province in northwestern China, on May 16, 2019. Photo: Reuters

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“4G has changed people’s lives,” said Chen Jinqiao, deputy chief engineer at the academy, which is under the Ministry of Industry and Information Technology (MIIT), during his presentation on China’s 5G development in the conference. But he indicated that 5G has the potential “to change society,” as different industries adopt the technology to their various requirements.

Chen’s growth estimates come amid the increased pace of 5G infrastructure spending in China, which is attempting to move ahead in the global race to deploy ultra-fast, next-generation mobile networks.

With peak data rates up to 100 times faster than what current 4G networks provide, 5G has been held out as “the connective tissue” for the Internet of Things, autonomous cars, smart cities and other new mobile applications, establishing the backbone for the industrial internet.

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References:

https://www.scmp.com/tech/big-tech/article/3020815/5g-stimulate-us500-billion-china-tech-growth-over-next-five-years

https://www.scmp.com/tech/enterprises/article/2168665/made-china-2025-5g-offers-worlds-biggest-mobile-market-chance-seize

China IT Minister: 5G Licenses Coming this Year; Deployment timing dependent on technology maturation

China Telecom to accelerate 5G deployment; 100% Fiber network coverage; Gigabit fiber broadband deployment

https://techblog.comsoc.org/tag/chinas-imt-2020-promotion-group/

http://www.imt-2020.cn/en/category/65569

https://money.cnn.com/2018/04/16/technology/china-united-states-5g-technology-study/index.html

 

3 thoughts on “China Races Ahead of the U.S. in the Battle for 5G Supremacy + 5G to stimulate US$500B in China tech growth over next 5 years (CAICT)

  1. Is China ahead of U.S. in 5G? They have their own IMT 1020 RIT spec which was progressed by ITU-R WP5D at their July 2019 Brazil meeting. Also, China certainly sent more (state owned) operating company delegates to that ITU-R 5D meeting where candidate IMT 2020 RIT/SRITs were discussed and debated. Here are China operating company reps for that WP5D meeting:

    China Mobile Communications Corporation
    Mr HU Zhenping, Deputy Manager of Resource Management Division of Technology Department

    Dr ZHANG Yanyan, Senior Engineer

    Mr ZHENG Yi, Project manager

    China Telecommunications Corporation
    Mr QI Fei, Engineer

    China Unicom
    Mr FENG Yi, Manager

    Mr LI Yi, Senior Engineer

    Ms ZHOU Yao, Senior Engineer
    …………………………………………………..
    In sharp contrast, U.S. operators sent ONLY 4 delegates: 2 from AT&T, 1 from T-Mobile, 1 from Sprint. As usual ZERO from Verizon which is an ITU recognized operating agency.

    FCC sent 1 delegate to look after frequency aspects.

  2. China could ‘weaponise cities’ if it controlled 5G networks, retired US general says:
    -China will gain a capability for mayhem and mass surveillance, Robert Spalding says in memo
    -Others suppliers will not be able to compete with government-subsidised offerings from Huawei and fellow Chinese gear maker ZTE Corp, he says

    China’s desire to dominate new wireless technology poses a global threat that should be thwarted by a new, secure network, according to a former official in the Donald Trump administration whose call for an enlarged US government role caused an uproar last year.
    China will gain a capability for mayhem and mass surveillance if it dominates advanced 5G networks that link billions of devices, retired air force Brigadier General Robert Spalding said in a memo obtained by Bloomberg News.
    “The more connected we are, and 5G will make us the most connected by far, the more vulnerable we become,” Spalding, who left the National Security Council last year, said in the memo.
    He confirmed his authorship of the memo in an interview on Friday, saying he wrote it in recent days, and circulated it to national security professionals whom he declined to identify. A plan he backed last year aroused protests from Republican regulators and lawmakers and wireless companies who said it diminished the role of private companies.

    https://www.scmp.com/news/china/diplomacy/article/2180818/china-could-weaponise-cities-if-it-controlled-5g-networks

  3. China Mobile profit tumbles as data growth stalls

    China Mobile, the largest mobile operator in the world, warned of a limited upside for data traffic as the market becomes saturated, and stressed the need to find new growth as it reported declines in both profit and revenue in the first six months of 2019.

    Yang Jie, China Mobile chairman, said: “We witnessed ever-intensifying competition within the telecoms industry and from cross-sector players. When this is combined with the continued implementation of the national policy on speed upgrades and tariff reductions, the operating environment has become more complex and is full of uncertainty.”

    In a statement, the operator said the overall industry declined, with its revenue and profit inevitably squeezed, noting the communications market is becoming almost saturated; the upside of data traffic is rapidly diminishing; and it is increasingly difficult for operators to boost operating results by relying on traditional growth drivers alone.

    Net profit fell 14.6 per cent year-on-year to CNY56.1 billion ($7.9 billion), with telecoms service revenue slipping 1.3 per cent to CNY351 billion. Mobile turnover dropped 6.1 per cent to CNY252 billion as handset data revenue dipped 1.5 per cent to CNY195 billion.

    Its mobile subscriber base rose 3.2 per cent to end June with 935 million. LTE penetration reached 78.5 per cent after the operator increased 4G subs by 8.4 per cent.

    Looking at its aggressive 5G plans, the operator said it will develop non-standalone (NSA) and standalone (SA) networks concurrently with the latter its ultimate goal, making full use of 4G sites and transmission resources to “achieve low-cost and high-efficiency network construction”.

    IoT revenue increased 43.8 per cent to CNY5.2 billion, as it added 142 million connections to take the total to 693 million at end-June.

    https://www.mobileworldlive.com/asia/asia-news/china-mobile-profit-tumbles-as-data-growth-stalls/

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