China is expected to invest over $150 billion in its 5G networks through 2025, China’s state-run news agency Xinhua reported, citing a note from Goldman Sachs.
According to the brief note, nearly three-quarters of this amount will be invested in 5G wireless systems.
“That’s more than the country’s $100 billion investment in 4G from 2013 to 2018, an increase driven in large part by the higher number of 5G base stations and higher initial cost of 5G equipment,” said Allen Chang, a researcher at Goldman Sachs.
Chang also highlighted that Chinese operators are expected to deploy 4.9 million 5G base stations by 2030.
The analyst said that the deployment of 5G networks in China will offer a wave of opportunities for relevant tech companies, mainly driven by increased semiconductor demand and a surge in consumer device upgrades.
“Telecom operators, equipment makers, and devices makers worldwide will all likely boost their demand for semiconductor chips in the coming years as they look to upgrade their systems and technology for the 5G era,” he said.
According to a recent report by the GSMA, China is currently testing 5G across all major cities and provinces, ahead of commercial launches next year. It is forecast that 28% of China’s mobile connections will be running on 5G networks by 2025, accounting for about a third of all 5G connections globally by that point.
Last month, China’s Ministry of Industry and Information Technology (MIIT) officially issued licenses for the launch of commercial 5G networks in the country.
The 5G permits were granted to state-run carriers China Mobile, China Unicom, China Telecom and state-owned broadcaster China Broadcasting Network.
At the end of last year, the MIIT issued licenses for 5G trials in a number of cities across China.
China Mobile, the world’s largest mobile operator, has plans to deploy 5G commercial cities in over 50 cities across China by the end of this year. The announcement was made during Mobile World Congress 2019 Shanghai, which took place last week. The carrier said that it aims to deploy over 50,000 5G base stations across China this year. The company aims to expand the 5G commercial services to all Chinese cities above the prefecture level by 2020.
China Mobile said it is working to integrate 5G technologies with other new technologies, including artificial intelligence and the internet of things, with the aim of offering specific 5G-based solutions across different sectors in China.
Telecom vendors are also expecting to see huge possibilities with the deployment of 5G in China.
“By the end of this year, we expect China to have large-scale, pre-commercial 5G networks by the three operators, while we expect large 5G commercial networks in the country during 2020,” Chinese vendor ZTE’s senior vice president and president of the wireless product division, Zhang Wanchun, told reporters during Mobile World Congress 2019 Shanghai.
Zhang said that ZTE has been actively working with the three carriers in the development of 5G field trials across China.
“We have also signed contracts for the launch of pre-commercial 5G networks with the Chinese carriers,” he added.
