Growth of 5G and Its Smart Applications in China

With the release of the annual results of China’s Big 3 mobile operators, China Mobile, China Telecom, and China Unicom, the common theme noticed is the increasing customer base and focus on 5G development. China Mobile, currently the largest mobile telecommunications corporation in China, saw an increase in subscribers from 925.1 million in 2018 to 950.3 million in 2019. Similarly, China Telecom’s subscribers rose by 10.7% while China Unicom saw a slight jump of 3 million subscribers to their mobile business. Service revenue has also increased across the board with China Mobile up 0.5% to US$95.0 billion, China Telecom up 2.0% to US$50.3 billion, and China Unicom up 0.3% to US$37.2 billion.

Emphasis on 5G has been growing in China with 5G subscriber numbers expanding—15.4 million for China Mobile and 10.7 for China Telecom as of the end February 2020. As such, the three operators are forging ahead by increasing Capital Expenditure (CAPEX) on their 5G network. China Mobile has planned to invest around US$14.0 billion in 2020, having already spent US$3.3 billion in 2019 and building 50,000 5G Base Transceiver Stations (BTS). China Telecom and China Unicom intend to spend around US$6.3 billion and US$4.9 billion respectively. Moreover, the two companies have signed an agreement on co-building and co-sharing 5G networks in September 2019 and have since rolled out more than 60,000 5G-enabled BTS. In comparison, 5G operators in the United States, such as Verizon, plan to invest between US$17.5 billion and US$18.5 billion in CAPEX in 2020 for its entire cellular network.

5G has the potential to support a wide range of innovative applications. In the case of smart city applications, a network of sensors supported by 5G will enable pervasive connectivity between intelligent transport systems, smart grids, and automated households in a smart city. Additionally, integrating 5G with Artificial Intelligence (AI), big data analysis, the Internet of Things (IoT), etc., will improve businesses, people’s livelihood, and much more.

Following the outbreak of COVID-19, 5G-powered smart patrol robots are currently being used by China to monitor body temperatures and mask-wearing in public areas. Developed by Guangzhou Gosuncn Robot Company, which offers smart city IoT products and services, the robot enables public safety personnel to reduce their exposure to potential health risks. It is attached to high-resolution cameras and infrared thermometers that can conduct temperature scans of up to 10 people within a 5-meter radius. Relevant authorities will be alerted immediately to cases that pose potential risks. Human Horizons, a mobility technology company focused on building autonomous driving solutions, recently began conducting a smart city project in Shanghai, China. The company is working to use 5G network alongside vehicle technology, big data, cloud computing, and AI. The aim of the project is to create a smart ecosystem consisting of autonomous driving buses, smart city traffic management centers, and a smart road network. The Xiongan New Area is where another smart city project has been undertaken. The project is being pushed by the Chinese government with the aim of improving infrastructure with technologies such as a 5G network, sensor recognition, and satellite information services. It has become a test area for 5G technology and its vertical applications with the goal of promoting the next generation network. 

As part of China Mobile’s “5G+” Plan for 2020, the company aims to build 250,000 new 5G BTS and scale up its commercialization. Adding on to that, both China Telecom and China Unicom jointly target building another 250,000 5G BTS to cover all cities nationwide by the end of the year. It is estimated that there will be a total investment of US$173.3 billion on 5G network construction by 2025. Such scaling of 5G infrastructure will contribute to drive investment on smart applications in different industries.

According to ABI Research’s 5G in Automotive and Smart Transportation (AN-5229) Application Analysis Report, it is forecasted that by 2035, 5G services will have generated a total of US$17 trillion in economic growth. Additionally, it is mentioned that it would take about 14 to 15 years for 5G to break even if it were to remain in the consumer market. Conversely, it would take 10 years if enterprise business models were implemented. These factors indicate the strong growth potential of 5G services and the importance of working with businesses in propelling the development of smart cities in China.