Published: Sat, June 08, 2019
Finance | By Loren Pratt

China Grants 5G Licenses for Commercial Use

China Grants 5G Licenses for Commercial Use

All the four incumbent telecom operators in China received commercial 5G licences, raising the curtain on the commercial rollout of the next generation mobile networks in the world's biggest telecom market.

It has shipped more than 100,000 5G base stations, ranking top in the world, according to the company.

China Mobile, which is the largest of China's state-owned telecoms, is planning to provide 5G services in more than 40 Chinese cities by September. However, the latest issuance is the first time the authority gave green light to commercial layout. But the largest beneficiaries are expected to be China's leading equipment vendors Huawei and ZTE, both of which quickly pledged their full support to the Chinese operators with their "end-to-end 5G capabilities".

The Minister for Industry and Information Technology spoke at the ceremony that China "will continue to welcome overseas enterprises to participate in the rollout of China's 5G networks".

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While South Korea, the US, Australia and the United Kingdom have launched initial commercial 5G services in the second quarter, the scale of China's market is likely to dwarf the combined size of those economies, negating any first-mover advantage.

Chinese telecom companies are trying 5G technology in several cities across the country, including in the remote Himalayan region of Tibet.

Efforts by Washington to block Huawei escalated last month when the Trump administration put the company on its "entity list", which prohibits U.S. companies from trading with the firm unless they have a licence. The company said it plans to accelerate 5G commercialization, through co-building and co-sharing of 5G networks to reduce the costs of network construction and maintenance.

The decision by the Chinese government is likely to help Huawei, which has faced uncertainty over its ability to supply parts to 5G networks outside of its home country.

"I believe that China is taking concrete action to contribute to multilateralism and free trade in a system that is under attack by raising unilateralism and protectionism".

The firm has also signed a draft agreement with the African Union that includes cooperation in 5G communications.

Huawei said that it started 5G research since 2009 and has invested a total of $2 billion in 5G technology and product research and development.

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