SINGAPORE – Chinese mobile operators are making hefty investments as they push ahead with building the 5G network across the country despite not having fully reaped the returns on 4G, said a China Telecom executive on Friday (June 7).

Mr David Dai, a vice-president at what is China’s third-largest 4G mobile operator, has expanded its pilot programme from 17 cities to 40 as it regards the 5G network as a strategic development for industry and the nation.

China handed out commercial 5G licences to its three big state-owned telcos and a major TV network on Thursday, accelerating the roll-out of this high-speed, low latency network.

This all-out push comes as the United States is blacklisting Huawei, a key Chinese 5G network equipment provider.

Both China and the US are racing to lead the world in deploying 5G, which promises to bring frontier applications such as self-driving cars to reality.

Observers have said the US ban on Huawei could be a major setback for China in its 5G ambitions.

Despite that, Mr Dai told a panel discussion at the Future China Global Forum on Friday that work on building the 5G network in China is moving at a very fast pace, with 790,000 base stations slated to be erected by the three telcos this year.

The country aims to have three million 5G base stations within three years, which is about half of all the numbers globally, he noted.

“We are to get the entire network built before there are any commercial applications of the technology,” added Mr Dai.

He said that all three telcos have poured in a lot of resources in the past few years to test commercial applications of 5G in areas such as Internet of Things and Internet of Vehicles, which refers to connecting vehicles to other vehicles or traffic infrastructure like traffic lights using a wireless network.

Mr Dai said the industry has achieved good progress in broadcasting, Internet of Vehicles as well as telemedicine.

Fellow panellist Nikhil Batra, research director at technology consultancy IDC Asia Pacific, said Australia could have been too quick to ban Huawei from participating in its 5G rollout.

Australia-based Mr Batra noted that many European countries and Asian carriers are still open to using Huawei as part of their 5G ecosystem, the latest being Russia’s largest mobile carrier.

“Networks are the lifeline of modern society and the governments are taking a very conservative view,” he told a packed audience of businessmen, scholars and policymakers.

They are treating mobile networks as a critical infrastructure, just like how they are treating the electricity grid and water supply, he added.

Mr Batra noted that Australia’s Huawei ban has effectively crippled plans by one of its three major telcos from participating in the 5G roll-out.

With fewer players involved, it invariably impedes innovation in the sector. “This slows down the development of 5G in the country and across the entire region.”

When asked by the audience what would be the best- and worst-case scenario in China’s 5G development over the next two years, panellist Caroline Gabriel, an analyst from telecoms consultancy Analysys Mason, said the best case will be for the barriers to go away, allowing China to fully participate in the global industry again.

As for the worst-case scenario, she said: “5G will be rolled out but the operators will not find a strong business case in the first few years and they will get discouraged by that.”

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