By Xiao Jian, senior strategy director of Alibaba Cloud Research Center
Edited by Zhang Nan, from Alibaba Cloud Research Center
5G has been commercially available in China for more than a year now, and is becoming more commonplace with the rise of 5G-enabled devices. In this blog, we will share, in retrospect, the progress made in the past year as well as the current situation and development trends of 5G in China.
Since the world's first 5G commercial service was launched in 2019, the world has been accelerating its pace into the 5G era. Many major economies have been actively promoting the commercial implementation of 5G to speed up digital transformation.
There has been several in-depth analysis on the latest progress, development issues, and application scenarios of 5G, such as the one covered in Alibaba's New Infrastructure Insight: Research Report on Application Scenarios for 5G Smart Economy. Taking the report as a reference, this article will briefly describe the latest progress of 5G, focusing on its development in China.
On July 3, 2020, 3GPP, an international organization responsible for formulating communication standards since 3G, announced to freeze the R16 standard, which marks the completion of the first evolved standard of 5G. The R15 standard supports two of the three major scenarios of 5G: Enhanced Mobile Broadband (eMBB) and Ultra-Reliable and Low Latency Communications (URLLC). The R16 standard improves Massive Machine Type Communication (mMTC).
Although officially initiated in the second quarter of this year, the R17 standard will be postponed because of COVID-19, so the freezing time cannot be confirmed yet.
Currently, 5G has been commercially available in at least 50 countries, 8 of which have officially provided 5G phone numbers before China, including South Korea, the USA, Switzerland, Australia, Italy, Spain, the UK and the United Arab Emirates. Japan has made 5G officially commercially available since March 25, 2020. According to the actual current network test of the Opensignal, the transmission rate of 5G is up to 2.7 times faster than that of 4G (in the USA). Due to the acceleration of 5G network construction by Chinese operators, the network utilization rate and domestic user number are relatively low. Therefore, the tested transmission rate of 5G in China is 8-10 times of that of 4G. At the time of writing, the number of 5G users in the world is still very small and has just exceeded 10 million by the end of 2019. The two major operators in the USA have only provided 5G commercial services in a limited number of cities, while South Korea takes the lead and will soon achieve the nation-wide coverage of 5G.
The development of 5G terminals has never been done independently, as it requires close cooperation with chip manufacturers and network vendors, and frequent testing and joint debugging in the actual network. The recent rise of geo-political tensions and sanctions have impacted the scientific and technological advances of 5G terminals.
At present, only several mobile phone manufacturers have listed several 5G mobile phones around the world. Existing available mobile phones using Qualcomm X50 chips are provided by Samsung, OPPO, VIVO, and Lenovo. By the end of 2019, MediaTek's dual-mode chip has also officially come onto the market. Apple's iPhone11 was designed in the first half of 2019, and it did not use 5G chips because the technology of 5G chips was still immature. Apple's iPhone12 released in 2020 is officially equipped with Qualcomm X55 5G Chip.
Because of the difference of network frequency and network environment among countries, the first batch of available 5G mobile phones requires massive current network tests and parameter tests. It is also an indispensable stage for the commercial use of 5G mobile phones. Therefore, 5G mobile phones released in the middle 2019 are in small-scale testing and experimental stage. Most mobile phones listed earlier (those using X50 chips), will have difficulty in entering China's 5G network from the second half of 2020. The reason is that Qualcomm X50 chips do not support 5G SA. The real-matured full-mode 5G mobile phones will not be available at least until the end of 2020 because of COVID-19.
China has put 4G into commercial use about 2 years later than the USA, Japan, and South Korea. However, in terms of 5G, China has adopted it at almost the same period with the world's earliest nations to achieve commercial 5G, excluding the USA and South Korea.
On June 6, 2019, the Ministry of Industry and Information Technology of China issued 5G commercial licenses to the four major operators, including NRTA. In November 3, 2019, three major operators in China officially issued tariffs. Currently, 5G network construction is under way. By the end of 2019, the user number of commercial 5G nationwide has exceeded 3 million.
With a higher wireless spectrum, the coverage of 5G single base station is smaller than that of 4G, thus requiring more macro base stations to be constructed. To achieve the same coverage scale, the station number of 5G is about 2 times of that of 4G, which means higher economic costs and longer time for construction. Therefore, most operators around the world carry out 5G constructions with supplementation of 4G coverage. They build 5G base stations in hotspot areas with large amounts of data, such as financial street, CBD and other business districts, to distribute mobile Internet traffics.
China's operators have intended to combine Non-standalone (NSA) with 4G, and then gradually transit to 5G SA in the future. However, due to the construction of new infrastructures in 2020, China's 5G construction has adopted the more radical SA (Note: 5G network slicing technology can only be realized based on SA). SA requires greater investment for operators, for SA needs to build new 5G core networks. The capital expenditure on 5G of the three major operators will surpass at least 200 billion RMB in 2020.
In 2020, due to the epidemic, Chinese government has released the New Infrastructure stimulus plan, which regards 5G construction as the most important part. The Ministry of Industry and Information Technology requires that the year-round construction of about 800,000 base stations in 2020 by the three major operators should be completed one quarter ahead of schedule. The nationwide 5G construction process has been comprehensively accelerated, reaching the year-round base station construction target ahead of schedule. During the China Development Forum held on November 11, 2020, Liu Liehong, Vice Minister of the Ministry of Industry and Information Technology, presented the latest data. The data shows that China has completed the construction of nearly 700,000 5G base stations in 2020. The number of 5G base stations in China is basically more than twice of the total number of 5G base stations in other nations.
The operation cost of 5G is the rarely mentioned. Due to the large scale construction of 5G base stations in China, most of them share the same iron towers and basic resources of 4G. Under the condition that 4G's capacity will not be expanded, 5G base stations preferentially utilize iron towers and part of transmission resources. In addition, the MIMO technology used in 5G base stations leads to 3-4 times of power consumption that of 4G base stations. It is estimated that after achieved 5G full coverage by the three major operators in the future, the total electricity cost of 5G base stations will be over 100 billion RMB per year. By far, local governments in China have gradually subsidized the electricity charge for 5G base stations to encourage 5G construction.
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