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China’s early release of 5G licenses to put it ahead in global competition

(Global Times)    16:06, June 04, 2019

A woman walks past a billboard of 5G in Beijing, capital of China, June 3, 2019. China will soon grant 5G licenses for commercial use, the country's Ministry of Industry and Information Technology said Monday. The sentence means "5G promotes future development". (Xinhua/Cai Yang)

China will release 5G business licenses to its three major telecom carriers soon, the country's Ministry of Industry and Information Technology (MIIT) said Monday.

The move will catapult the country into a serious 5G industrial revolution, according to industry insiders.

As 5G is very much faster than 4G, the official licenses will place the three carriers at the forefront of the global 5G race, as the technology is expected to accelerate the transformation of traditional industries and give rise to a myriad of new applications and business models.

The new technology will create tens of thousands of new jobs, and according to industry insiders, it is expected to create new value of between 900-1,300 billion yuan ($130.3 billion to 188.2 billion) in the next two years in China.

Industry insiders predict that the official distribution of 5G business licenses will take place later this week, likely on Friday.

"There will be an announcement very soon," an official from the MIIT, who requested anonymity, told the Global Times on Monday.

The licenses will allow China to take the global lead in using 5G technology to revolutionize traditional industrial assembly lines, and this experience and know-how will spread to other partner economies that have contracted to use 5G technology.

"This is basically a green light for telecom companies to make final preparations to roll out commercial 5G," said Fu Liang, a Beijing-based telecom industry analyst, although he noted it might take some time before 5G enters full use.

The MIIT is likely to issue licenses at the same time to all three major telecom operators in the country - China Mobile, China Unicom and China Telecom - as they have been conducting trial tests in major Chinese cities in recent months, according to analysts.

The big three carriers have been deploying 5G networks. China Mobile is projected to build 30,000 to 50,000 5G base stations by the end of 2019, with a total investment of 17.2 billion yuan, according to media reports.

China Telecom will build about 20,000 base stations and invest 9 billion yuan while China Unicom plans to establish about 20,000 base stations with a total investment of about 6 to 8 billion yuan, the reports said.

As part of network trials, 5G-powered phone calls have successfully been made in regions including South China's Guangdong and East China's Fujian provinces, as well as in Beijing and Shanghai municipalities.

Role of Chinese firms

Chinese telecom equipment providers and carriers are also major contributors to 5G patents and standards proposals, which are indispensable for the global push to roll out 5G.

Huawei Technologies and ZTE Corp are among the top five 5G standard essential patent owners worldwide, with 1,554 and 1,208, respectively. Huawei is the largest contributor of 5G technical standards, Berlin-based market intelligence platform IPlytics said in a report released in April.

"China's contribution to 5G technology development also reflects the rapid progress the country has achieved in 5G compared to other countries, and it has also been exploring various application scenarios, including autonomous driving, virtual reality and smart cities," Li Zhen, an industry analyst at Beijing-based CCID Consulting, told the Global Times on Monday.

China is now among the global leaders in 5G rollout, in addition to the US, South Korea and Australia, and the release of the business licenses will ensure it will maintain its leading position, the analyst said.

Win 5G race

Chinese 5G-related companies rallied on the stock market on Monday, with shares of ZTE surging nearly 6 percent and shares of Fiberhome Telecommunication Tech Co up 4 percent.

The MIIT also sent out a signal that China is not scared of the US-led crackdown on Huawei, which is a major driving force in global 5G development, and the country will continue competing to lead the 5G race at a firm pace, analysts said.

"As the US treats China as a competitor, it is only normal that [China] also speeds up a bit accordingly," Jiang Junmu, chief writer at telecom industry news website c114.com.cn, told the Global Times on Monday.

Chinese players are also pushing forward 5G rollouts in overseas markets.

Malaysian Prime Minister Mahathir Mohamad said that Malaysia tries to make use of Huawei technology as much as possible, and Huawei has already launched 5G trials in the Southeast Asian country, CNN reported on Friday.

In spite of the US-led global clampdown on Huawei, the Chinese firm helped UK carrier EE air a live tech segment on a BBC morning news show, the first consumer use in the local market.

Continuing to open up and collaborate with major players will help Huawei expand, which will also help China lead the 5G race, analysts said.

"China will also include other companies in the rollout of 5G, unlike the US," Fu said, noting that Huawei, ZTE, Ericson and Nokia will all have the same treatment and opportunities in China. 

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Xian Jiangnan, Bianji)

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