What Is Pushing China’s 5G Technology To Develop So Rapidly?

5g-technology-china-internet-bull-report

Riding on the fourth industrial revolution, China’s 5G technology has become one of the most exciting areas to watch as the next big thing.

With telecom titans like Huawei, Qualcomm, and Intel transforming not only industries but the entire country with broad applications and economic significance.

Breakthroughs in fields such as artificial intelligence (AI), big data, fifth-generation telecommunications networking (5G), the Internet of Things (IoT), quantum computing, nanotechnology, biotechnology, and robotics can potentially shift the future balance of economic and military power, prompting governments and large corporations to race competitively over technological development and applications.

The super speedy 5G “fifth-generation” mobile-phone networks has caught much global attention.

With Chinese 5G user numbers spiking (China Mobile: 55.6 million users | China Telecom: 30 million users – by March 2020), functions that can be performed across internet-connected sensors, vehicles, appliances, and all kinds devices become increasingly unimagined.

With a 10 times decrease in latency, 100 times improvement in traffic capacity, and 100 times improvement in network efficiency, 5G’s critical role in allowing technologies to flourish across industries is undeniable.

So, what is pushing China’s technology to develop so rapidly?

 

Three compelling reasons haven given China’s 5G development a real advantage:


First, China’s entrepreneurial culture has provided massive Venture Capital Investments to fund great innovations.

Since 2015, China has outspent the United States by approximately $24 billion in wireless communications infrastructure and built 350,000 new sites, while the United States built fewer than 30,000.

Additionally, China’s five-year economic plan specifies $400 billion in 5G technology related investment.

Greater wireless infrastructure with security like s a s e can allow the companies to scale up faster and expand in new technological areas. However the race is close, as the U.S. wireless providers are expected to outspend their Chinese counterparts on 5G capital expenses, $284 billion to $179.8 billion, from 2018 to 2025, according to data from GSMAi.


Second, China’s strong Social E-Commerce Culture has made applications such as WeChat (multi-purpose messaging mobile app), OFO (bike-sharing mobile app), Pinduoduo (group-buying-platform) a way of life.

The utilization of these mobile apps to solve societal or life problems has provided a conducive environment for supporting technical infrastructures to develop. From a technical standpoint, meeting the current demand of the sheer volume of Chinese mobile customers is enough motivation to push for continuous technical advancement.

Furthermore, technologies such as augmented reality (AR), virtual reality (VR) and cloud computing that are dependent upon reliable 5G networks – also call for the adoption of next generation wireless technology.


Third, the Advantages of State-Level Policy has given China enormous benefits in the tech space. China’s long-standing diplomatic position that it never seeks to interfere in other nations’ internal affairs also made it possible for the country to focus on domestic developments easier than the other countries.

China’s largest three operators’ capability to spend billions of dollars on 5G equipment is a direct benefit from the government’s “Infrastructure Stimulus Package” that almost tripled from year 2019.

Some think that 5G technology is where China and the West will finally diverge.

The race to 5G has been largely documented as American Intelligence Officials start to see a world where Huawei and other Chinese telecom companies are most likely to control 40 to 60 percent of the networks over which businesses operate.


 

The result of this race will bring a wide range of benefits as well as risks on the competitive global landscape.

Policymakers have viewed the dispute as a trade issue, as the Trump administration has taken steps to:

“block China’s national telecommunications champion, Huawei, from operating in the United States and starve it of American technology as it builds networks around the globe,”

as described by The New York Times.

The countdown to the 5G revolution has begun, and it is only going to intensify.

 

Avatar
Ada Wang

Ada holds a BA in International Affairs and Diplomacy and an M.B.A. from the University of Washington. Ada's interest in investment management stems from her desire to drive innovative results and create true value. Having held consulting positions in both the United States of America and in China, Ada specializes in taking her business toolkit to arm a diverse clientele with the right information to unlock creative sources of economic value to maximize growth. When not working, you can hear her classical piano playing wafts through Manhattan's skyline.

No Comments Yet

Comments are closed