Nokia won its first 5G radio contract in China, after securing a share in one of China Mobile’s three contracts for the provision of 700MHz 5G base stations, while rival vendor Ericsson lost market share chiefly due to political tensions between China and Sweden.
Through these three contracts, China Mobile aims to purchase approximately 480,000 5G base stations to expand its 5G footprint. The new network infrastructure will be shared between China Mobile and China Broadcasting Network, which was established as a new mobile operator last year.
Chinese vendors Huawei and ZTE took the lion’s share of the contracts. According to a document published by China Mobile, Huawei secured a majority share in all three contracts, followed by ZTE and Datang.
Huawei secured 61% of the first contract, 59% of the second contract and 58% of the third package, according to the results released by China Mobile. The contracts could be worth as much as CNY38.35 billion ($6 billion) in revenue for Huawei, according to local press reports. ZTE was awarded the second-largest portions, with 33.5%, 30% and 29% of the contracts.
Meanwhile, Nokia, which had failed to obtain 5G radio contracts in China in 2020, got a 10.1% share in one of the three contracts, while Ericsson secured a share of 9.6% of another contract.
Chinese carriers China Telecom and China Unicom are also expected to announce winners of their second phase of 5G tenders in the coming days.
In a statement, Ericsson highlighted that the risk of lower market share award follows the decision by the Post and Telecommunication Authority (PTS) to exclude Chinese vendors’ products from the 5G auction in Sweden.
“Given the context and based on the bidding rules, should Ericsson be awarded business in China Unicom and China Telecom we believe it would be in a similar range as with the China Mobile award,” the Swedish vendor said.
Chinese operators have already deployed a total of 916,000 5G base stations, accounting for 70% of the world’s total, according recent reports.
Also, according to data provided by the country’s Ministry of Industry and Information Technology (MIIT), the number of 5G-connected devices in China has exceeded 365 million now, making up 80% of the world’s total.
Earlier this month, Chinese government agencies jointly issued a three-year 5G action plan aiming to significantly improve 5G development in the country, according to the report.
Ten departments including the MIIT, the Cyberspace Administration of China and the National Development and Reform Commission (NDRC) jointly issued a three-year 5G action plan with the goal of advancing the adoption of 5G technology in China.
The three-year action plan sets the goal to reach over 560 million 5G users by 2023, with the penetration rate of 5G technology exceeding 40% among Chinese users.
China Mobile, the world’s largest operator in terms of subscribers, added 16.65 million 5G subscribers in May, according to the carrier’s latest available figures.
The carrier said it ended last month with 221.95 million 5G subscribers, compared to 55.60 million 5G customers in May 2020.
