China 5G connections to reach 428 mn by 2025

China 5G connections is forecast to reach 428 million by 2025, accounting for 39 per cent of the 1.1 billion global 5G connections according to a new study by GSMA Intelligence and the China Academy of Information and Communications Technology (CAICT).

Chinese operators are expected to deploy ‘standalone’ 5G networks, which will require the construction of new base stations to site 5G equipment, backhaul links and a core network.

Mats Granryd, Director General of the GSMA said, “In its early phase, 5G will offer an enhanced mobile broadband experience that will enable next-generation consumer services such as augmented and virtual reality, while at the same supporting mission-critical applications across a range of industry verticals.”

China is planning to run a phased testing period for 5G networks from 2017 to 2019 before launching commercially in 2020.

In their early phase, 5G networks will concentrate on boosting the capacity of 4G networks to support rising cellular data traffic demands. 5G will also enable enhanced mobile broadband (eMBB) services such as 4K/8K Ultra-HD video and augmented reality (AR) and virtual reality (VR) applications.

5G will support applications that require massive scale or are mission-critical and therefore demand low latency. Key vertical markets for 5G applications include automotive and transport, logistics, energy and utilities monitoring, security, finance, healthcare, industrial, and agriculture.

4G penetration in China has increased five fold to 61 per cent over the two-year period to March 2017 and there remains significant headroom for 4G growth. As a result, 4G and 5G networks are expected to co-exist in China for a considerable period of time.

The rate of 5G network rollout and adoption in China is also expected to be slower than it was for 4G, which Chinese operators were able to deploy rapidly earlier this decade within a mature 4G ecosystem.

On capex, indications from the Chinese mobile operators are that 5G investment will follow a more gradual path and over a longer timeframe than 4G, roughly seven years, from 2018 to 2025 – with capex not expected to account for more than 25 per cent of operator revenue prior to commercial launch.

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