Every single telecom operator in the world is now attempting to transform from telco to techco, to break free from their antiquated, legacy, and stale connectivity business and evolve to sell technology platforms, a considerably more lucrative and promising business. Their success is not guaranteed, and many find it difficult – if not impossible – to unshackle themselves from their history and comfort zone.

ABI Research now says it’s measuring the progress of telco transformation by quantifying the number of patents that telcos hold and also measuring their involvement in standards-setting initiatives like 3GPP (whose specs are standardized by ETSI and ITU-R).

Telecom operators from China and Japan are currently at the forefront of technology transformation, which shows in their involvement in 3GPP and patent holdings,” says Dimitris Mavrakis, Senior Research Director at ABI Research. “China Mobile, NTT Docomo, and China Telecom have invested time, effort, and capital in both domains, which now translates to significant expertise, knowledge, and recognition in the industry. Although this is not the only metric for innovation, these leading network operators are well suited to transforming their business, technology, and strategic platforms to look to the future.”

The findings of the latest ABI Research report on telecom operator innovation indicate that they consistently contribute to 3GPP work, approximately 8% of the total contribution. Of these telecom operator contributions to 3GPP, 43% originate from China, 29% from Japan, 14% from Europe, and 12% from the United States. Leading operators are China Mobile, NTT Docomo, China Telecom, Orange, Vodafone, and Deutsche Telekom. Their Standards Essential Patent (SEP) holdings are similar, with China Mobile and NTT Docomo leading the market.

Standards contributions and patent holdings are good measures of willingness to innovate and get involved in leading the market. “Telecom operators must get involved and not let other companies lead the direction of the market – especially when geopolitics and semiconductor supply constraints are affecting the market. With 5G Advanced and upcoming 6G, they have the technology to innovate, but they must now take more risks and lead the market,” Mavrakis concludes.

Fierce Wireless asked why T-Mobile didn’t rank, given the good progress that it’s made with its 5G SA network and network slicing trials. Mavrakis said, “T-Mobile US is part of Deutsche Telekom, which is represented in the chart above. They are indeed making progress toward network slicing, but our report measures 3GPP standards activities and patents, which is a different area of innovation.”

These findings are from ABI Research’s Telco versus Techco: Operators’ Role in Shaping Cellular Innovation and 3GPP Standards application analysis report. This report is part of the company’s Cellular Standards & IPR research service, which includes research, data, and ABI Insights. Based on extensive primary interviews, Application Analysis reports present in-depth analysis on key market trends and factors for a specific application, which could focus on an individual market or geography.

…………………………………………………………………………………………………………………………………

Separately, ABI Research says 5G end-user services deployment continue to accelerate in China, which is very much leaving other markets in its wake. Not only does it have 3.2 million 5G base stations up and running, but also a wide range of 5G-to-Business (5GtoB) applications.

According to China’s Ministry of Industry and Information Technology (MIIT), the country has built or upgraded more than 3.2 million 5G base stations—accounting for 30% of the overall mobile base stations nationwide—which has already exceeded the initial target of deploying 2.9 million 5G base stations by the end of 2023. A fourth mobile operator, China Broadnet, has also been issued a 5G mobile cellular license to help stimulate consumer and enterprise competition.

5G subscriber adoption has been robust. At the end of 1Q 2023, the number of 5G subscriptions in the country had increased to around 1.3 billion, which is an increase of more than 53% from approximately 850 million 5G subscribers as of March 2022. The China Telecom Research Institute reported that the average download speed for 5G is a very robust 340 Megabits per Second (Mbps).

China’s mobile operators have seen an overall increase in service revenue. China Mobile reported an 8.1% Year-over-Year (YoY) increase in telecommunication service revenue, with mobile Average Revenue per User (ARPU) up 0.4% to CNY49 (US$6.9). China Telecom also reported a 3.7% YoY increase in mobile communications service revenue with mobile ARPU up 0.4% to CNY45.2 (US$6.3), whereas China Unicom saw a 3-year consecutive growth in mobile ARPU to CNY44.3 (US$6.2).

Growth in revenue has been primed by an expansion in revenue models the telcos can offer. Revenue for China Mobile’s 5G private networks also saw an increase of 107.4% YoY growth, reaching RMB2.55 billion (US$365.5 million) by December 2022. Meanwhile, China Unicom experienced a spike in 5G industry virtual private network customers from 491 to 5,816 between June 2022 and June 2023. Across the board, the three operators have collectively reached a cumulative total of more than 49,000 5G commercial enterprise projects, with China’s MIIT reporting that the operators have built more than 6,000 5G private networks, to date.

China’s mobile cellular ecosystem is not resting on its laurels. Urged on by China’s government, the sector has been embracing 5G-Advanced, as underpinned by The 3rd Generation Partnership Project’s (3GPP) Release 18. Included in Release 18 are greater support for Artificial Intelligence (AI) integration, 10 Gigabits per Second (Gbps) for peak downlink and 1 Gbps for peak uplink experience, supporting a wider range of Internet of Things (IoT) scenarios, and integrated sensing & communication. Information gathered through sensors can enable communication to be more deterministic, which improves the accuracy of channel conditions assessment. Another example is dynamic beam alignment for vehicle communications using Millimeter Wave (mmWave). China’s mobile operators and vendors are keen to adopt 5G-Advanced due to its ability to support a 10X densification of IoT devices compared to 5G. There is also support for passive 5G IoT devices that can be queried by campus and/or indoor small cells to provide telemetry-related data. Instead of a field or warehouse worker, or even an Autonomous Guided Vehicle (AGV) with a portable Radio Frequency Identification (RFID) reader, the campus cellular network can track asset tags in real time and remotely—eliminating the need to check up and down warehouse aisles individually.

5G-Advanced (not yet standardized) deployments are materializing in China. China Mobile Hangzhou launched its Dual 10 Gigabit City project in early 2023. This project focuses on using 5G-Advanced technologies to support applications such as glasses-free Three-Dimensional (3D) experiences on different devices during the Asian Games. Such early experimental projects are not limited to only one city in China. To the northeast of Hangzhou, China Mobile Shanghai has also started its own project to build the first 5G-Advanced intelligent 10 Gigabit Everywhere City (10 GbE City). The network is built using the 2.6 Gigahertz (GHz) network initially for the main urban areas before expanding the coverage to the entirety of Shanghai.

5G deployment, integration, and usage is accelerating. The China Academy of Information and Communications Technology anticipates that US$232 billion will have been invested in 5G by 2025. An additional US$37.9 billion (RMB3.5 trillion) of investment will also take place in the upstream and downstream segments of the industrial chain. During a 2023 Science and Technology Week and Strategic Emerging Industries Co-creation and Development Conference, MIIT stated that 5G connectivity has been integrated into “60 out of 97 national economic categories, covering over 12,000 application themes.” ABI Research has not verified all the use cases reported by MIIT, but ABI Research’s ongoing research into the 5G-to-Business (5GtoB) market in Asia has validated that there are a wide range of 5GtoB trials, pilots, and commercial rollouts taking place in China.

A further ABI Insight that you may find interesting is “China Telecom Is the First Operator Worldwide to Launch a “Device-to-Device” Service on a Smartphone to Improve Coverage.”

About ABI Research:

ABI Research is a global technology intelligence firm delivering actionable research and strategic guidance to technology leaders, innovators, and decision makers around the world. Our research focuses on the transformative technologies that are dramatically reshaping industries, economies, and workforces today.

References:

https://www.prnewswire.com/news-releases/3gpp-activities-and-patent-holdings-paint-a-bleak-picture-of-telcos-failure-to-innovate-toward-techco-status-301981014.html

https://www.fiercewireless.com/5g/abi-research-praises-china-mobile-ntt-docomo-5g-innovation

https://www.abiresearch.com/market-research/insight/7782761-china-is-leaving-the-rest-of-the-world-in-/

6th Digital China Summit: China to expand its 5G network; 6G R&D via the IMT-2030 (6G) Promotion Group

ABI Research: 5G Network Slicing Market Slows; T-Mobile says “it’s time to unleash Network Slicing”

ABI Research: Expansion of 5G SA Core Networks key to 5G subscription growth

ABI Research: Major contributors to 3GPP; How 3GPP specs become standards

ABI Research: 5G-Advanced (not yet defined by ITU-R) will include AI/ML and network energy savings

China will ratchet up resources to advance the construction of its 5G network, expand the application of 5G technology in various fields, and promote the research and development of 6G, officials and experts said at the 6th Digital China Summit, which ended on Friday in Fuzhou, Fujian province.

“China has built the world’s largest 5G network with the most advanced technologies. The number of the country’s 5G base stations had exceeded 2.64 million by the end of March this year,” said Zhao Ce, deputy head of the information and telecommunications development department at the Ministry of Industry and Information Technology.

Zhao said the ministry will make more efforts to bolster the building of the 5G network in an orderly manner and accelerate its industrial applications, push forward the R&D of 6G, and strengthen international exchange and communication in 5G-related technology, standards and application.  5G wireless technology has been used in 52 of the 97 major economic categories, with large-scale application expanded to mining, ports and electricity, he said. Moreover, China has already established the IMT-2030 (6G) Promotion Group, a flagship platform in China promoting 6G and international cooperation.

As 5G technology serves as a critical foundation supporting the development of artificial intelligence, big data and cloud computing, heightened efforts should be made to explore application scenarios of 5G and empower the transformation of traditional industries, said Zhang Wang, deputy head of the informatization development bureau of the Cyberspace Administration of China.

China has recently unveiled a plan for the overall layout of the country’s digital development, vowing to make important progress in the construction of a digital China by 2025, with effective interconnectivity in digital infrastructure, a significantly improved digital economy, and major breakthroughs achieved in digital technology innovation.

Cao Ming, president of the wireless product line at Huawei Technologies, said China is taking the lead in 5G development across the globe, and 5G is expected to play a bigger role in bolstering digitalization in a wide range of sectors covering intelligent connected vehicles and intelligent transportation.

A model of the Beidou Navigation Satellite System is exhibited at the 6th Digital China Summit in Fuzhou, Fujian province, on Thursday. [PHOTO/CHINA NEWS SERVICE]

“As the next-generation mobile communication technology, 6G integrates with telecommunication, perception, computation, artificial intelligence, big data and security,” said Cui Chunfeng, president of the future research institute at the China Mobile Research Institute, adding the research on 6G is still at a preliminary stage worldwide.

Although there is no universally accepted definition of 6G, the technology is predicted to provide faster speeds, lower latency and more bandwidth than 5G. The 6G network will realize the deep integration of physical and virtual worlds, and build a new world featuring the intelligent connection of everything, Cui said.

Noting new cybersecurity challenges have popped up with the rapid development and application of 5G technology, Qi Xiangdong, chairman of Chinese cybersecurity company Qi-Anxin Technology Group, said the company will strengthen cooperation with the country’s major telecom carriers to help them deal with growing cybersecurity risks.  Qi said China’s cybersecurity industry has maintained annual growth rate of 15 to 20 percent, while calling for efforts to increase investment in talent training and enhancing security awareness among netizens.

………………………………………………………………………………………………………………………………………………………………………………………………………….

Another Opinion on 6G:

6G is the upcoming sixth-generation cellular network technology that is currently in early development. One of the goals of 6G cellular technology is not just to deliver basic content faster to smartphones, like streaming video, but to create a cellular network capable of supporting real-time augmented reality, virtual reality, and a future Internet of Things (IoT) model where small smart devices are a ubiquitous presence in and outside of our homes.

When reading anything about 6G, especially the breathless and hype-laden announcements from telecommunications companies that emphasize how 6G will usher in the metaverse, a fusion of our physical and virtual lives, and so on, you should keep the “early” part of early development in mind.

Currently, there are no established 6G specifications or standards, let alone deployed 6G networks or devices. Even the most basic aspects of 6G development, like which specific frequencies the next generation cellular technology will rely on, are still being ironed out along with technical challenges like energy and heat dissipation demands of advanced 6G devices.

That said, we do have some idea what 6G will look like. Current cellular technology operates in the Megahertz (MHz) and the lower Gigahertz (GHz) frequency ranges. The portion of the radio spectrum under consideration and testing for 6G includes frequencies in the 30-300 Ghz range—also known as millimeter waves (mmWave) or Extremely High Frequency (EHF) radio—and the Terahertz (THz) frequency up to 3000 Ghz. The use of these frequencies will allow for data transmission well beyond the bandwidth capacity of current cellular technology.

In December of 2022, Qualcomm released a 6G development plan with 2030 as a projected rollout date for 6G tech. Ericsson’s 6G messaging echoes the early 2030s timeframe too, as do various interviews with telecom executives.

5G was first introduced in 2019. Four years later, there are still millions of cellular subscribers using 4G, and 5G is yet to have a fully realized coast-to-coast rollout. GSMA’s authoritative 2023 Mobile Economy report, for instance, indicates North American adoption rate of 5G is only 39%, with more than half of cellular subscribers still using 4G. By their projections, the North American 5G adoption rate will be 91% by 2030, meaning by the time 6G potentially arrives, there will still be 4G subscribers out there.

Given the current development timelines, you should expect a delivery arc similar to the 5G rollout. If you live in a major metropolitan area, there is a good chance you’ll be covered by early 6G networks around 2030. If you’re not in a major metropolitan area, it’s likely you’ll be waiting well into the 2030s for the 6G rollout.

So if we step away from the hype and look at the matter practically, it’s likely only a small percentage of people will be using 6G-based networks by 2030. But the bulk of North American subscribers, and certainly the majority of global subscribers, will still be on 5G networks.

References: