China Telecom
China Telecom, ZTE jointly build spatiotemporal cognitive network for digital transformation
ZTE Corporation and the Zhejiang Branch of China Telecom have jointly built a self-adaptive spatiotemporal cognitive network based on ZTE’s Radio Composer, improving dynamic user experiences in high-capacity scenarios. Under the collaboration with intelligent user navigation, the network solution matches network resources with traffic distribution more precisely and efficiently through on-demand elastic coverage of two-layer network, adapting to user group flow in space over different time periods.
The spatiotemporal cognitive network intelligently predicts traffic distribution in the first place. According to location change of user groups in different time periods within base station coverage, the network solution, by virtue of LSTM (long short-term memory) algorithms, performs in-depth study and prediction of traffic distribution on physical grid level and analyses the traffic space distribution trend in different periods.
Based on the traffic distribution trend in both time and frequency, the spatiotemporal cognitive network implements the intelligent carrier power scaling function through power sharing, to achieve flexible coverage adjustment. Below is an example of Traffic distribution of different periods in one area over time:
When the traffic loads within coverage of the two carriers are both high, the solution balances the two carriers with the same coverage to guarantee capacity. When the traffic loads within coverage of the two carriers differentiates obviously, the solution adjusts the coverage mode. It adopts high power to cover the high-load area and decreases power in the low-load area, therefore precisely matching radio resources to ensure user experiences.
The spatiotemporal cognitive network focuses on intelligent experience collaboration and establishes AI logic grid knowledge base of base stations, in order to further balance network efficiency and user experiences.
Moving forward, the Zhejiang Branch of China Telecom and ZTE will keep innovating together to provide superb network performance and boost digital transformation.
References:
China’s telecom revenue: +8.1% YoY from Jan-Nov 2021
With the caveat that you can’t trust any economic numbers reported by China’s government………….
China’s Ministry of Industry and Information Technology says that the country’s telecommunications industry registered robust growth in revenue in the first 11 months of this year, according to “official data.”
The combined industrial revenue rose 8.1% year on year (YoY) to over 1.35 trillion yuan (about 212 billion U.S. dollars) in the January-November period.
The growth was down 0.1 percentage points from the figure for the January-October period, the data showed.
By the end of November, China’s three state owned telecom giants — China Telecom, China Mobile and China Unicom — had over 1.64 billion mobile phone users, a net increase of 47.92 million users compared with the end of last year. The number of 5G mobile subscribers reached 497 million, up 298 million from the end of last year, according to the ministry.
A poster of commercial 5G applications shown outside a branch of China Telecom in Beijing. Photo Credit: SHEN BOHAN/XINHUA
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China’s big three telecom companies also saw a steady increase in the number of fixed broadband internet users by the end of November, with subscribers rising by 51.85 million from the end of last year to stand at 535 million.
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As of 2021, China is the only country known to work towards a single-stack IPv6 network. The country announced plans in 2017 to lead globally in IPV6 adoption by 2025, and achieve full nationwide rollout by 2030. Experts believe that such a plan to widely adopt IPv6 for the country’s internet infrastructure, can help China to increase its leadership in 5G and Internet of Things (IoT) across multiple varying industries.
References:
http://www.china.org.cn/business/2021-12/26/content_77953625.htm
https://en.wikipedia.org/wiki/Telecommunications_industry_in_China
China telcos add 43.71 5G subscribers in July, while capital spending declines
5G Subscriber Adds:
China’s network operators recorded a net addition of 43.71 million 5G subscribers in July, according to the carriers’ latest available reports.
- China Mobile, the world’s largest operator in terms of subscribers, added 28.91 million 5G subscribers in July. It had 279.60 million 5G subscribers at the end of July, compared to 84.05 million 5G customers in July 2020. The telco’s overall mobile subscriber base at the end of July reached 947.46 million, up compared to 945.50 million in June 2020.
- China Unicom said it added a total of 7.74 million 5G subscribers during July. During the first seven months of the year, Unicom added a total of 50.24 million 5G subscribers. The telco ended July with 121.07 million 5G subscribers. China Unicom reported an overall mobile base of with 311.61 million subscribers at the end of last month, up from 310.45 million in June.
- China Telecom added 7.06 million 5G subscribers in July to take its total 5G subscribers base to 138.21 million. The telco added 51.71 million 5G customers in the January-July period. China Telecom’s overall mobile base amounted to 364.62 million subscribers at the end of the July, after adding 2.13 million customers during the month.
China Telco CAPEX Crash:
However, total capital spending by the three state owned China telecom operators declined by 35% in the first half, with the number of new 5G base stations down 34% compared with last year. Spending on 5G by the two biggest telcos, China Mobile and China Telecom, slid 19%. China Unicom, has not disclosed its 5G spending but said it had reached only a fifth of its full-year capex target.
China Unicom revealed it had spent only RMB14 billion ($2.2 billion) of its 2021 capex budget of RMB70 billion ($10.8 billion), down 45% from 2020. It has a year-end target for 5G of RMB35 billion ($5.4 billion), the same as 2020.
China Mobile’s 5G investment of RMB50.2 billion ($7.8 billion) was 9% lower than last year, and only 46% of its full-year target of RMB110 billion ($17 billion).
China Tower reported a 28% fall in capex to 10.4 billion yuan ($1.6 billion).
China Telecom’s 5G spend plunged 45% to RMB11.1 billion ($1.71 billion), just over a quarter of its full-year forecast of RMB39.7 billion ($6.1 billion). Total capex declined 37% for the half. From the Chinese website Yicai.com:
From the data point of view, China Telecom’s capital expenditure in the first half of this year was less than one-third of the annual capital expenditure, and the investment progress was lagging behind. Liu Guiqing said that 5G was the largest investment in the first half of the year, including investment in 3.5GHz and 2.1GHz equipment. “On the whole, the investment in 3.5GHz equipment is relatively normal; for 2.1GHz investment, we make corresponding adaptations according to the current situation of the entire industry chain and the terminal ecology. At present, the purchase of 2.1GHz equipment has been completed, 3.5GHz telecom equipment is being negotiated, and there will be results soon.” He said that 87 billion yuan of investment can be completed this year, of which 5G investment is 39.7 billion yuan.
The China telcos maintain the same capex guidance for the full year of around 185 billion yuan ($28.6 billion), slightly up from last year’s 182 billion yuan ($28.1 billion). Yet for China Telecom and China Unicom, those capex numbers look quite challenging.
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5G Base Station Builds:
China’s three major mobile carriers have already activated 961,000 5G base stations and connected 365 million 5G-compatible devices by end-June, Chinese press reported, citing comments by press secretary for the Ministry of Industry and Information Technology (MIIT) Tian Yulong.
Unicom said it had built just 80,000 new base stations in the first half and was aiming to deploy another 240,000 in the latter half of this year.
Meanwhile, China Broadcast Network and China Mobile have recently completed a tender to deploy 400,000 5G base stations this year, as part of the companies’ efforts to launch a shared 5G network. The contracts had been won by Huawei, ZTE, Datang, Nokia and Ericsson.
China Mobile has attributed its lower 5G investment to issues around its partnership with China Broadcast Network in building a new 5G network in the 700MHz band. The main tender was set in July. China’s 5G rollout is a high priority infrastructure project closely supervised by the national government. The two carriers expect this shared 5G network to reach nationwide coverage within the next two years.
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5G Subscriber Forecast & 5G SA Core Network:
China is forecast to reach 739 million 5G subscribers by 2025, according to a recent study by ABI Research. That would represent nearly 40% of the total global 5G subscriber market.
Earlier this year, Liu Liehong, vice minister of industry and information technology, had said that 5G Standalone (5G SA) networks covered all prefecture-level cities across China.
We wonder if all China’s telcos have implemented the same specification for 5G SA/core network and whether it is “cloud native” or not? Also, whether they use NFV (virtual machines) or containers?
Note there is no standard or implementation specification(s) that would ensure vendor interoperability on 5G SA networks from different telcos.
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References:
https://www.rcrwireless.com/20210824/5g/chinese-carriers-add-43-million-5g-subscribers-july
https://www.lightreading.com/5g/chip-shortage-taking-its-toll-on-china-5g-rollout/d/d-id/771681?
https://www.yicai.com/news/101136803.html
China Telcos Lose Subscribers; 5G “Co-build and Co-share” agreement to accelerate
ZTE and China Telecom deploy QCell 5G SuperMIMO solution
ZTE Corporation together with the Quanzhou Branch of China Telecom, have deployed the QCell 5G SuperMIMO solution in Quanzhou, China.
The Qcell 5G SuperMIMO solution can combine Super cell and MU-MIMO technologies, to adaptively perform multi-User Endpoint (UE) space division pairing. The solution is applicable to both digital QCell and traditional distributed antenna systems (DAS), which effectively solves the “interference” vs “capacity” tradeoff, while exponentially increasing user perception.
As the field test results show, the QCell super cell throughput is 1.07Gbps before SuperMIMO is enabled. It reaches 2.2Gbps, 3Gbps and 4.05Gbps respectively after it’s been enabled. That greatly improves user experiences with 2 UE, 3 UE and 4 UE performing services at the same time.
In 2020, ZTE and China Telecom jointly launched the innovative 2.1GHz NR eDAS indoor distribution solution, which is the first 5G network performance improvement solution based on the traditional 2.1GHz NR indoor distribution system in the industry. The solution successfully overcomes the bottleneck of the traditional system.
SuperMIMO has developed into another innovative indoor distribution technology following the eDAS solution, thereby demonstrating the strength of the Quanzhou Branch of China Telecom and ZTE in the research and innovative applications of communication networks.
Moving forward, both parties will be further committed to building high-quality 5G networks for their users through technical innovations.
Quanzhou, China. Photo Credit: ZTE Corporation
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Previously, ZTE and the Jiangsu branch of China Telecom deployed 5G 200 MHz Qcell 4T4R digital indoor distribution system in areas with high amounts of data traffic, such as shopping malls and subway stations, in Xuzhou, China.
The system provides high-quality 5G indoor coverage, and accelerates future 5G indoor system deployment. This commercial deployment has employed ZTE’s latest 5G Qcell ultra-wideband product series, which supports 200MHz continuous ultra-large bandwidth at 3.5 GHz frequency band, and 100MHz+100MHZ dual-carrier aggregation technology that doubles download rate.
References:
https://www.zte.com.cn/global/about/news/20210809e1.html
Gartner: Worldwide 5G Network Infrastructure Revenues to Grow 39% in 2021
Worldwide 5G network infrastructure revenue is on pace to grow 39% to total $19.1 billion in 2021, up from $13.7 billion in 2020, according to the latest forecast by Gartner, Inc.
Communications service providers (CSPs) in mature markets accelerated 5G development in 2020 and 2021 with 5G representing 39% of total wireless infrastructure revenue this year.
“The COVID-19 pandemic spiked demand for optimized and ultrafast broadband connectivity to support work-from-home and bandwidth-hungry applications, such as streaming video, online gaming and social media applications,” said Michael Porowski, senior principal research analyst at Gartner.
5G is the fastest growing segment in the wireless network infrastructure market (see Table 1). Of the segments that comprise wireless infrastructure in this forecast, the only significant opportunity for investment growth is in 5G. Investment in legacy wireless generations is rapidly deteriorating across all regions and spending on non-5G small cells is poised to decline as CSPs move to 5G small cells.
Table 1: Wireless Network Infrastructure Revenue Forecast, Worldwide (Millions of U.S. Dollars)
| Segment | 2020 Revenue | 2021 Revenue | 2022 Revenue |
| 5G | 13,768.0 | 19,128.9 | 23,254.6 |
| LTE and 4G | 17,127.8 | 14,569.1 | 12,114.0 |
| 3G and 2G | 3,159.6 | 1,948.2 | 1,095.2 |
| Small Cells Non-5G | 6,588.5 | 7,117.9 | 7,113.9 |
| Mobile Core | 5,714.6 | 6,056.2 | 6,273.3 |
| Total | 46,358.5 | 48,820.2 | 49,851.0 |
Source: Gartner (August 2021)
Regionally, CSPs in North America are set to grow 5G revenue from $2.9 billion in 2020 to $4.3 billion in 2021, due, in part, to increased adoption of dynamic spectrum sharing and millimeter wave base stations. In Western Europe, CSPs will prioritize on licensing spectrum, modernizing mobile core infrastructure and navigating regulatory processes with 5G revenue expected to increase from $794 million in 2020 to $1.6 billion in 2021.
Greater China is expected to maintain the No.1 global position in global 5G revenue reaching $9.1 billion in 2021, up from $7.4 billion in 2020. With China’s government funding 5G development for the three state owned carriers, that’s no surprise.
The big beneficiaries of China’s 5G infrastructure spending will be its domestic equipment makers, Huawei, ZTE, and (state owned) Datang Telecom. Despite clamoring for Sweden to permit Huawei 5G equipment to be deployed, Ericsson only received 3% of a joint 5G radio contracts from China Telecom, China Unicom and 2% from China Mobile, according to Reuters. Nokia, which was expected to take away Ericsson’s market share in China, did not receive any share, according to a tender document published by the Chinese companies.
In a way that’s a win for the Swedish vendor – and a brief share price hike backs up that statement – which won just 2% of an earlier deal from China Mobile. But if they want to secure their share of the multiple billions of dollars of global 5G infrastructure revenues forecast by Gartner, the likes of Ericsson and Nokia will need to keep winning contracts in their home markets.
5G Coverage in Tier-1 Cities Will Reach 60% in 2024:
While 10% of CSPs in 2020 provided commercialized 5G services, which could achieve multiregional availability, Gartner predicts that this number will increase to 60% by 2024, which is a similar rate of adoption for 4G- LTE in the past.
“Business and customer demand is an influencing factor in this growth. As consumers return to the office, they will continue to upgrade or switch to gigabit fiber to the home (FTTH) service as connectivity has become an essential remote work service,” said Porowski. “Users will also increasingly scrutinize CSPs for both office and remote work needs.”
This rapid shift in customer behavior is driving growth in the global passive optical network (PON) market as a preferred technology. The 10-Gigabit-capable symmetric-PON (XGS-PON) is not a new technology and with the price difference with other technologies narrowing, CSPs are willing to invest in XGS-PON to differentiate themselves in customer experience and network quality. Gartner estimates that by 2025, 60% of Tier-1 CSPs will adopt XGS-PON technology at large-scale to deliver ultrafast broadband services to residential and business users, up from less than 30% in 2020.
Gartner clients can learn more in the reports “Forecast Analysis: Communications Service Provider Operational Technology, Worldwide” and “Forecast: Communications Service Provider Operational Technology, Worldwide, 2019-2025, 2Q21 Update.”
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Small Cells?
While Gartner did not split out small cells’ contribution to the overall 5G infrastructure segment, evidence thus far suggests the market is progressing more slowly than many had once believed.
Last month, Crown Castle increased its guidance for the second time this year due to a strong cell towers market, but halved the number of small cells it expects to deploy in 2021 to 5,000. The company noted that wireless network operators have focused on tower-based 5G rollouts at the expense of small cells.
References:
5G network kit revenues to near $20 billion this year — report
China Telecom: NB-IoT Users Exceed 100 Million -World’s Largest Number of 5G NB-IoT
China Telecom reached a new milestone as its 5G narrow-band Internet of Things (NB-IoT) [1.]user base grew to more than 100 million. This is the largest number of 5G NB-IoT connections the industry has ever acquired, making China Telecom the world’s largest carrier for NB-IoT and the world’s first carrier to have developed such a large user base. News of this achievement came during the 2021 World Telecommunication & Information Society Day (WTISD) commemoration on May 17, in which e-Surfing Internet of Things Technology (e-Surfing IoT) released the latest 5G IoT achievements on behalf of China Telecom.
Note 1. NB-IoT is a narrow band radio access technology designed for the IoT, allowing connections between IoT devices that is faster and on a wider range. The connection is for devices requiring small amounts of data, over long periods and consumes less energy.
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In July 2020, NB-IoT was officially endorsed as one of the global 5G standard technologies by ITU-R IMT 2020, paving the way for it to become an important part of 5G’s three major use cases.
A recent forecast by the Global System for Mobile Communications Association (GSMA) concludes that medium- and low-speed IoT connections will account for 90% of the total IoT connectivity by the end of 2025.
China Telecom was one of the world’s first carriers to start NB-IoT deployment, launching its services as early as 2017. After five years of extensive development, China Telecom has made breakthroughs in network coverage, user scale, platform services, chip modules, and industrial applications, demonstrating the role that NB-IoT has to play in forming the foundation for the digital economy.
China Telecom has built the world’s first and largest commercial NB-IoT network that delivers continuous coverage. With more than 400,000 NB-IoT base stations, users can leverage the most suitable spectrum resources, facilitating continuous network upgrades, network tests and service provisioning based on NB-IoT Release 14. Multi-carrier capacity expansion is also supported, adding extra flexibility to fulfil requirements for higher rate and larger capacity.
China Telecom has seen its IoT services used to support smart firefighting, security surveillance, urban facility management, smart homes, passenger car, charging device management, and smart appliances, with the total number of connections exceeding 100 million. It is the first time a carrier has acquired more than 100 million 5G NB-IoT users worldwide, making it an industry trailblazer. The company also leads in industry-specific use cases, with NB-IoT smart gas and water users numbering almost 30 million, making it the world’s largest provider of NB-IoT smart water and gas meter services.
China Telecom has deployed the industry’s first remote all-active NB-IoT device service platform to more than 100 million IoT devices with a 99% success rate of NB device data reporting. Its IoT Openness Platform, now in its fifth version — CTWing 5.0, offers a plethora of enhancements in smart congestion scheduling, remote upgrades, base station positioning, low power consumption, and quasi-real-time services. This means users benefit from massive-connectivity and low-power access, reducing overall terminal R&D costs while shortening R&D periods and improving NB-IoT experiences. The number of IoT device connections on the CTWing platform has exceeded 60 million, with an average of nearly 20 billion calls per month.
China Telecom has launched the industry’s first batch of NB-IoT chip modules which offer improved module performance, production efficiency, and reliability at reduced development costs, making them a powerful enabler of digital transformation.
China Telecom has also expanded NB-IoT applications to many other fields, from COVID-19 prevention and control to social governance, people’s livelihood, smart appliances, smart city, and smart agriculture, in the goal of evolving the “Internet of Everything” to evolve to “the Intelligent Internet of Everything.”
According to e-Surfing IoT, China Telecom’s NB-IoT technology has been applied in various industries, becoming a powerful enabler of industry digitalization and digital industrialization as part of the digital China vision.
To help contain the spread of COVID-19, China Telecom developed a smart door sensor, which has been adopted in several provinces across China, such as Heilongjiang, Guangdong, and Yunnan.
When it comes to social governance, China Telecom provides an array of smart community applications, such as NB-IoT smart smoke detectors, door status sensors, gas alarms, and manhole covers. These solutions improve the efficiency of community governance and property management while also encouraging the modernization of community governance systems, helping to support the digital economy.
In terms of people’s livelihood, China Telecom has rolled out tens of millions of NB-IoT smart water and gas meters. These meters enable automatic readings and alert solitary elderly to safety risks. China Telecom has also partnered with Goldcard Smart Group to turn Guangzhou into the world’s first city with over one million IoT gas meters.
China Telecom’s NB-IoT smart gas meters are now used by users reaching nearly 30 million people
As for smart home appliances, China Telecom and Haier Group have built the world’s first NB-IoT self-cleaning air conditioner, closing the gap of shared air conditioners for smart campuses and creating a new appliance consumption model for the sharing economy. China Telecom is also working with several home appliance giants in China to build a shared air conditioner leasing solution based on the NB-IoT technology, which is set to provide intelligent services for college students. These shared NB-IoT air conditioners have already been deployed in hundreds of colleges and universities in China.
China Telecom has helped build the country’s first city-level IoT platform in Xiong’an, a new national district in China. This platform is now the foundation for the city to build a digital replica.
In the smart agriculture, China Telecom is providing NB-IoT water quality monitoring services for an orchard town in Hunan Province. This helps to monitor water quality in real-time and implement intelligent agricultural breeding. Additionally, China Telecom’s NB-IoT technology is being used to enable smart cow services for a ranch in Xinjiang autonomous region.
With CTWing, its IoT Openness Platform, e-Surfing IoT will continue to advance the maturity of the IoT ecosystem, promote the scaled implementation of IoT applications, and enable digital industrialization and industry digitalization for the digital economy.
China Telecom media contact: [email protected]
MIIT: China has 260M 5G subs; Telecom business revenue significantly increased
China telecom regulator MIIT (Ministry of Industry and Information Technology) revealed this week that China has 260 million 5G subscribers at the end of February 2021. That is a huge number and more than the rest of the world combined [1.], but still a long way short of the 361 million claimed by the three operators. in February.
- China Mobile reported 173.2 million 5G package customers compared to 15.4 million 5G customers in February 2020. China Mobile’s overall mobile subscriber base was said to be 937.16 million at the end of February, down from 940.86 million in January.
- China Telecom added a total of 6.2 million 5G subscribers in February 2021 for a total of 103.4 million.
- China Unicom had 84.5 million 5G subscribers at the end of February 2021.
Note 1. GSA says that global 5G subscriptions grew by 57% in the fourth quarter of 2020 to reach nearly 401 million globally (representing 4.19% of the entire global mobile market). By the end of 2025, 5G will account for 31% of the global market (at 3.39 billion subscriptions), although LTE will still be dominant at 53.3% of all global mobile subscriptions.
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China’s vice-minister of industry and information technology Liu Liehong recently said that a total of 718,000 5G base stations have been built in China, accounting for nearly 70% of the world’s total 5G cell sites.
During Mobile World Congress Shanghai 2021, government officials said that Chinese carriers have invested more than CNY260 billion ($40.2 billion) to build the world’s largest 5G network.
MIIT further stated:
The growth rate of telecom business revenue has increased significantly. From January to February, the total revenue of telecommunications services reached 237.3 billion yuan, an increase of 5.8% year-on-year, and the growth rate increased by 4.3 percentage points year-on-year. The total telecommunications business calculated at the constant price of the previous year was 249.1 billion yuan, a year-on-year increase of 25.9%.
The scale of mobile phone users is basically stable, and 5G users are developing rapidly. As of the end of February, the total number of mobile phone users of the three basic telecommunications companies reached 1.592 billion, a year-on-year increase of 0.8%. As of the end of February, the number of 5G mobile terminal connections of the three basic telecommunications companies reached 260 million, a net increase of 61.3 million from the end of the previous year, accounting for 16.3% of mobile phone users.
Light Reading’s Robert Clark wrote: “The three (China) telcos’ annual filings over the past two weeks indicate that between them they spent a hefty 173 billion yuan ($26.5 billion) on 5G and they’re not slowing down; they’ve set aside another 185 billion yuan for 2021.”
“Their pricing, with plenty of encouragement from government officials, is also aggressive, with China Mobile’s 5G entry package costing just 128 yuan ($19.56). The heavy investment and the moderate pricing in pursuit of national objectives is why their results indicate little reward for the effort so far.”
MIIT also commented on other telecom services (besides 5G):
Data and Internet business revenue accounted for 60%, supporting the steady growth of overall telecom business revenue. From January to February, the three basic telecommunications companies completed fixed data and Internet business revenues of 41.5 billion yuan, a year-on-year increase of 10.2%, accounting for 17.5% of telecommunications business revenues, accounting for a year-on-year increase of 0.8 percentage points, driving a 1.7 percentage point increase in telecommunications business revenue . The revenue from mobile data and Internet services showed a decline for the first time. The completed business revenue was 106.2 billion yuan, a year-on-year decrease of 1.2%, and its share of telecom business revenue fell to 44.7%.
Fixed and mobile voice services declined steadily, and their share of telecom business revenue continued to decline. From January to February, the three basic telecommunications companies completed fixed voice and mobile voice business revenues of 3.82 billion yuan and 18.64 billion yuan, a year-on-year decrease of 1.1% and an increase of 5.0%, respectively, accounting for 9.5% of the total revenue of telecommunications services, and a decrease of 0.1%. Percentage points. The rapid growth of income from emerging businesses has strongly promoted the growth of telecom business income. The three basic telecommunications companies are actively transforming and upgrading, promoting IPTV, Internet data centers, big data, cloud computing, artificial intelligence and other emerging businesses. From January to February, they completed a total of 36.2 billion yuan in related business income, a year-on-year increase of 28.9%. The proportion increased sharply by 2.8 percentage points year-on-year to 15.3%, driving the growth of telecom business revenue by 3.6 percentage points.
The proportion of fixed broadband access users with speeds above 100M has exceeded 90%, and the number of gigabit users has continued to increase. The total number of fixed Internet broadband access users reached 492 million, a year-on-year increase of 8.9% and a net increase of 8.67 million from the end of the previous year. Among them, there are 463 million FTTH/O users, accounting for 94% of the total number of fixed Internet broadband users. The number of fixed Internet broadband access users with an access rate of 100Mbp and above reached 450 million, accounting for 90.4% of the total number of users, an increase of 0.5% from the end of the previous year; the promotion of gigabit broadband services was accelerated, and the access rate of 1000Mbps and above was fixed. The number of Internet broadband access users reached 8.03 million, a net increase of 1.63 million over the end of the previous year.
Mobile Internet traffic increased significantly, and DOU remained at a relatively high level in February. From January to February, the cumulative mobile Internet traffic reached 30.9 billion GB, a year-on-year increase of 31.8%. Among them, the Internet traffic through mobile phones reached 29.7 billion GB, a year-on-year increase of 31.2%, accounting for 96% of the total mobile Internet traffic. In February, the average mobile Internet access traffic (DOU) per household was 10.85GB/household, which was 1.97GB/household higher than the same period last year.
The penetration rate of fixed broadband access users of 100M and above tends to be even in all regions. As of the end of February, fixed broadband access users of 100Mbps and above in the eastern, central, western and northeastern regions reached 189.68 million, 11.17 million, 116.57 million and 26.74 million, respectively, accounting for 89.3. %, 91.7%, 90.8% and 91.8%. The difference between the highest proportion of fixed broadband access users above 100M and the lowest proportion in each province was 15.3 percentage points.
China Unicom and China Telecom say nearly a quarter of their mobile customers are on 5G plans. Chna Unicom boosted ARPU 4%, while China Telecom reported 5G ARPU nearly 50% above its blended ARPU.
China Mobile reported a 1% rise in profit but, despite the huge 5G subscriber base, recorded another decline in mobile ARPU.One winner for China Mobile was broadband access, which grew 17%, while China Telecom and China Unicom both experienced large increases in their smart home services.
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Editorial Comment:
Many experts don’t trust economic numbers released by China’s government. Questions over the accuracy of China’s economic data, including industry groups like telecom, persist due to the lack of transparency used in the collection process. Critics say the government does not state how the data is collected or the different components that form the final numbers that are released to the public.
The methodology China uses to calculate its economic and industry data is opaque, and some knowledgeable people even accuse the government of abruptly changing methods without announcement to distort figures and hide declines.
The motivation seems to be to make China’s economy and industry groups look much stronger than they really are.
Most analysts treat any official Chinese data with caution and skepticism. Yet they have few, if any ways to establish an alternative, more accurate assessment of the world’s second-largest economy.
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References:
https://www.miit.gov.cn/gxsj/tjfx/txy/art/2021/art_82f101e1d078447fac75443a50348b7c.html
https://www.lightreading.com/asia/china-5g-race-taking-its-toll-on-operators/d/d-id/768369?
https://gsacom.com/paper/lte-and-5g-subscribers-march-2021-q4/
Analysis and Implications: China’s 3 Major Telecom Operators to be delisted by NYSE
The New York Stock Exchange (NYSE) said it will delist China’s three large state owned telecom carriers. The move was expected after a November U.S. government order barring Americans from investing in companies it says help the Chinese military.
- China Mobile, which is among the most valuable of China’s listed state-owned enterprises, will be removed from the Big Board after more than two decades.
- China Unicom Hong Kong will also be delisted along with China Telecom.
The NYSE said it would suspend trading in securities issued by China Mobile, China Telecom and China Unicom by January 11th. The big board also said it would also halt trading in closed-end funds and in exchange-traded products listed on its NYSE Arca exchange if they hold banned China stocks.
The U.S. Defense Department (DoD) had previously listed the three companies as having significant connections to Chinese military and security forces. The delisting highlights the faltering of long-established business ties between the United States and China, which were set up over decades as China sought to internationalize and reform its state-run corporate behemoths (see China-U.S. Cold War backgrounder below).
The NYSE decision is the latest setback for these companies, which rank among the largest global telecommunications providers. The exchange’s decision is unlikely to seriously harm the Chinese telecom giants in the near term. Mounting pressure from Washington has already stymied their ability to operate in the U.S., a country that makes up a negligible amount of their international business.
China’s top three network providers still benefit from hundreds of millions of customers in their home country. That has attracted investors to their Chinese-listed shares. The cellphone carriers have spent billions of dollars on new fifth-generation wireless networks over the past two years with support from officials in Beijing, who have called 5G upgrades a national priority.
All three telecoms companies operate under Beijing’s firm control. They are ultimately owned by a government agency, the State-owned Assets Supervision and Administration Commission, and are often ordered to pursue Beijing’s goals. China’s ruling Communist Party sometimes shuffles executives among the three companies.
They are the only three companies in China that are permitted to provide broad telecommunications network services, which Beijing regards as a strategic industry that must remain under state control.
Xi Jinping, China’s top leader (President of the People’s Republic of China 中华人民共和国主席), has talked about making state companies bigger and stronger rather than more streamlined. That has led to concerns among some economists and entrepreneurs that the Chinese government is taking a greater role in private enterprise.
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Impact of the Delisting:
At the same time, the imminent delisting of several major Chinese companies will get the attention of portfolio managers, after a year long push to ensure Chinese firms’ compliance with U.S. audit rules. While the final outcome of that effort is unclear, the NYSE decision underscores the fraught politics of the U.S.-China relationship as the Trump administration comes to a close.
“The delisting issue is a live one with financial clients,” said Leland Miller, chief executive of China Beige Book International, which provides data on China’s economy to international investors. “There are some jittery people out there.”
On Friday, China Unicom said it would release a statement in due course. Neither China Telecom or China Mobile responded to WSJ requests for comment.
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China Telecoms Shares Greatly Underperform:
China Mobile’s U.S. stock is thinly traded compared with its Hong Kong securities, FactSet data shows. About 2.1 million American depositary receipts traded daily on average over the past three months, compared with 34 million Hong Kong shares a day. Each ADR is equivalent to five ordinary shares in Hong Kong.
U.S. shares in China Mobile, the largest of the three companies by market value, declined 29% over the past year, according to FactSet, while China Telecom dropped 30% and China Unicom fell 39%. Over the same span, the S&P 500 index returned 18% and the communications-services sector of the MSCI World Index rose 22%. All figures reflect total returns, including dividends.
Over the past decade, China Mobile shares have declined 15% including dividend payments, FactSet data show, while China Telecom has dropped 32% and China Unicom has fallen 54%. The S&P 500 has gained 267% on the same basis and the MSCI World communications sector has gained 165%.
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Backgrounder: China vs U.S. Cold War:
An executive order signed by President Trump in November will block Americans from investing in a list of companies the U.S. government says supply and support China’s military, intelligence and security services. The ban starts on Jan. 11 and investors have until November to divest themselves of their holdings.
The list currently includes 35 companies—including China’s largest chip maker—as well as surveillance, aerospace, shipbuilding, construction and technology companies.
It wasn’t initially clear whether the order covered subsidiaries as well as parent companies, and U.S. government leaders clashed over how broad the blacklist should be, The Wall Street Journal reported in December.
The Chinese government has accused Washington of misusing national security as an excuse to hamper competition and has warned that Trump’s order would hurt U.S. and other investors worldwide.
Political analysts expect little change in policy under President-elect Joe Biden due to widespread frustration with China’s trade and human rights records and accusations of spying and technology theft.
U.S. officials have complained that China’s ruling Communist Party (CCP) takes advantage of access to American technology and investment to expand its military, already one of the world’s biggest and most heavily armed.
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References:
https://www.wsj.com/articles/nyse-to-delist-chinas-major-telecommunications-operators-11609498750
https://www.nytimes.com/2021/01/01/business/nyse-delist-china-mobile.html
https://apnews.com/article/donald-trump-business-hong-kong-china-08e71111b26c119048c523c5ba3ebde5
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January 5, 2021 UPDATE:
The New York Stock Exchange reversed its decision to delist China Mobile, China Telecom, and China Unicom before it becomes effective.
NYSE said that “in light of further consultation with relevant regulatory authorities in connection with Office of Foreign Assets Control FAQ 857, available here, the New York Stock Exchange LLC (“NYSE”) announced today that NYSE Regulation no longer intends to move forward with the delisting action in relation to the three issuers enumerated below (the “Issuers”) which was announced on December 31, 2020.”
Meanwhile, the reversal is not yet final, as the NYSE maintained that it would “continue to evaluate the applicability of Executive Order 13959 to these Issuers and their continued listing status.” There is no substantiated evidence that pressure from China or intervention from the incoming Biden administration has played a role in the change of mind by NYSE.
Technically all the three Chinese state-owned telcos are listed on the Stock Exchange of Hong Kong (HKEX), and what’s traded in New York is an instrument called American depositary receipts (ADRs), which enables American investors to trade on foreign companies listed elsewhere.
On Monday, as a response to NYSE’s delisting announcement, the three telcos updated the market that ADRs represent between 3.3% and 8% of their total tradable shares. According to an earlier response by China Securities Regulatory Commission (CSRC) to NYSE’s original decision, the three operators’ ADRs only account for less than 2.2% of the equity shares of these companies, with “a total market capitalization of less than 20 billion RMB yuan” ($3.1 billion). China Mobile is the heaviest user of this instrument, accounting for 90% of the total value.
According to the Treasury Department, if NYSE’s original decision to delist were to go ahead, these companies would also need to be eliminated from other financial instruments, including derivatives, depositary receipts, exchange-traded funds, index funds, and mutual funds. The reversal of decision may have taken away the requirement for traders to make immediate changes in their products, some measures may still be needed as a precaution, and the actions may not be limited to the three telcos.
In December two index providers, FTSE Russell and S&P Dow Jones have both removed a number of Chinese companies from some of their indexes following the executive order. There are 35 companies on the Treasury Department’s list compiled for this particular executive order, including, in additions to the three operators, the usual suspects like Huawei and SMIC.
January 6, 2021 Update:
New York Stock Exchange Reverses Course Again, Will Delist 3 Chinese Telecom Firms After All!
China Telecom launches 5G standalone cloud native network with Tianyi Cloud
China Telecom claims it has launched what it says is the world’s largest 5G standalone (SA) network. Executives announced the start of commercial 5G SA operations during a company virtual conference last week and said their 5G SA network is currently supported by 30 devices, with 100 expected by year-end.
China Telecom’s 5G SA end-to-end capability testing with Tencent and Huawei was completed in September. Earlier in the week, China Telecom said it will offer 5G SA services to over 300 cities in China at a press event held with Qualcomm at Guangzhou, China.
Like all the other telcos on the path to 5G SA (only T-Mobile US has deployed it), China Telecom’s is said to be 5G SA is a cloud native network called the “Tianyi Cloud.” Company leaders said it’s 5G SA cloud network can guarantee “five-nines reliability,” secure network slicing and latency of below 5ms. In particular:
With the popularization of cloud computing, hybrid multi-cloud has become the new normal for cloud migration. It is just necessary to realize high-speed network interconnection and unified management between multi- clouds. The full-stack hybrid cloud launched by Tianyi Cloud realizes the same technical architecture of the underlying cloud platform and has no cloud capabilities. It extends and covers the deployment of three scenarios: edge, private cloud, and industry cloud. At the same time, it provides first-line multi-cloud capabilities, a dedicated line connects multiple mainstream public cloud service providers at the same time, and high-speed interconnection between public and private clouds can also be realized. In addition, it is worth mentioning that Tianyi Cloud’s full-stack hybrid cloud has been adapted to national production and production at the chip, hardware, and operating system levels, and has the ability to provide national production and service services.
The new generation of cloud-native database developed by Tianyi Cloud completely independently developed and technically tackled key problems. It successfully realized the de-IOE of China Telecom’s core IT system database. Telecom users and billion-level terminal equipment access. Through continuous upgrading and evolution, Tianyi Cloud’s new generation of cloud-native database has reached financial-level data security and high reliability, and has continuously broken through the limits of scale and performance, while being compatible with a complete database ecological chain, so as to meet customers’ diverse data service needs.
Also, China Telecom officially launched the “Cloud Terminal” plan at the event. Tianyi Cloud, as the base of the cloud terminal strategy, has independently created a cloud computer through computing in the cloud, data in the cloud, application in the cloud, security in the cloud, and imagination in the end mode. And cloud mobile phone products.
President and COO Li Zhengmao said the arrival of the 5G era provided the opportunity and the technical ability for the integration of cloud and the network.
In terms of 5G cloud integration, Hu Zhiqiang said:
“In the 5G era, cloud-network integration has entered a new realm. Cloud-network integration is the goal that Tianyi Cloud pursues.” On the one hand, Tianyi Cloud launched an intelligent edge video cloud to break through the bottleneck of ultra-high-definition real-time encoding technology. At the same time, it has real-time scheduling capabilities of millions of video streams. On the other hand, 5G is a cloud-based network. Tianyi Cloud provides 99.999% reliability guarantee and exclusive slice data security, achieving a comprehensive TCO reduction of more than 90%, and a delay of less than 5ms.”
A white paper presented at last week’s event describes China Telecom’s cloud-network integration as driven by open sharing, open network capabilities, multi-network access 5G and SD-WAN support. The China Telecom paper said the company was a hybrid multi-cloud strategy, integrating Alibaba Cloud, Tencent Cloud, Huawei Cloud, AWS, Azure and others into its aggregation platform.
In conclusion, Hu Zhiqiang said: “China Telecom Tianyi Cloud will continue to strengthen technological innovation, strengthen open cooperation, and accelerate the construction of a digital China and a smart society, and make greater contributions with partners.”
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References:
http://www.c114.com.cn/news/117/a1143514.html
https://www.lightreading.com/asia/china-telecom-gets-cracking-on-5g-standalone/d/d-id/765464?
China says it has deployed 700,000 5G base stations this year; Huawei’s forecast
China Telcos Lose Subscribers; 5G “Co-build and Co-share” agreement to accelerate
Decrease in China’s Mobile Subscribers:
China’s wireless carriers are reporting substantial drops in subscribers as the coronavirus crisis reduces business activity.
China Mobile Ltd., the world’s largest wireless carrier, reported its first net decline since starting to report monthly data in 2000. China Mobile subscriptions fell by more than 8 million over January and February, data on the company’s website show.
China Telecom Corp. said it lost 5.6 million users in February, while China Unicom Hong Kong Ltd. subscribers fell by 1.2 million in January.
The across the board China subscriber slump indicates that the coronavirus pandemic crisis, which first emerged in China late last year, is crimping growth, even at businesses that provide essential services and earn monthly revenue. ARPU will likely also decline, according to analysts.
Chris Lane, an analyst at Sanford C. Bernstein & Co said that part of the decrease in wireless subscribers could be due to migrant workers — who often have one subscription for where they work and another for their home region — canceling their work-region account after the virus prevented them from returning to work after the Lunar New Year holidays which began in late January.
While the drop in users is unusual, the total is small relative to total wireless subscriptions, which have risen to a combined 1.6 billion for the three carriers. Things may improve starting this month as work in factories and other businesses in China resumes, Lane said.
Net income fell 9.5% last year at China Mobile, partly on government mandates to cut prices and improve service, but also due to a spike in financing costs – up from RMB144 million ($20.2 million) to RMB3.25 billion ($460 million).
The company, which reported earnings last week, told analysts revenue would remain stable this year, a sign management was not worried about the fall in subscribers.
China Unicom overcame flat revenue growth to post an 11.1% increase in net earnings for 2019. The state-owned telco slashed opex by 22% and marketing cost by 5% to record a 11.3 billion yuan ($1.6 billion) full-year profit.
“In 2019, the domestic telecommunications industry development experienced a short-term pain with weak revenue growth and pressure on industry value,” Chairman and CEO Wang Xiaochu said.
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Co-build and Co-share Agreement:
In September 2019, China Unicom entered into a cooperation agreement with China Telecom to jointly build one 5G access network across the country. China Unicom would be doubling it’s own 5G network coverage, bandwidth, capacity and transmission speed, providing users with better experience.
China Unicom said it will actively step up the “co-build and co-share” with China Telecom in areas such as 4G indoor distributed antenna systems, server rooms, optical fiber and pipelines to further enhance network advantages and corporate value.
References:
https://www.bnnbloomberg.ca/china-s-mobile-carriers-lose-15-million-users-as-virus-bites-1.1410626
https://www.telecomlead.com/5g/china-unicom-reveals-5g-network-capex-plans-94530