Daily Management Review

Deloitte: China outstrips the US by number of 5G facilities


08/08/2018


Deloitte auditing and consulting company issued a report on development of mobile networks of the fifth generation (5G). The paper reveals a noticeable gap between the United States from China in investing and installing stations for these networks. Since 2015, China has installed 350 thousand base stations and other infrastructure facilities for 5G networks, while only 30 thousand of such facilities were installed in the US for the same period.



Kārlis Dambrāns
Kārlis Dambrāns
Deloitte reported that rapid growth of the Internet of things and augmented reality has become a catalyst for development of a new generation of high-speed mobile networks 5G. Japan, South Korea and the United States have made significant progress in developing a new communication standard, but these countries cannot compare with what China has achieved in this respect. In the five-year plan for the development of China, $ 400 billion in the form of direct investments and tax incentives are devoted for the development of fifth-generation networks. By now, according to Deloitte estimates, China has already invested $ 24 billion more in new networks than the US did. Researchers believe that in the very near future, China's progress may turn into a very real "5G-tsunami". Other countries may find it difficult to keep with such a rapid growth.

Since 2017, only one Chinese telecommunications company, China Tower, has set an average of 460 infrastructure facilities for 5G networks a day, investing about $ 17.7 billion. Stock markets investors have already noticed the progress - in early August, China Tower held the largest IPO in the world for the last two years. The IPO was held on the Hong Kong Stock Exchange, the company sold 43.1 billion new shares, which corresponds to 25% of the company's increased share capital. The company’s total capitalization was thus estimated at $ 28 billion.

According to Deloitte, the total number of towers, stations and other mobile infrastructure facilities in China Tower reaches about 1.9 million, while there are only about 200,000 such objects in the United States. The density of base stations per capita is three times as far behind China (4.7 units per 10 thousand and 14.7 units per 10 thousand). However, the world leader here is Japan (17.4 units per 10 thousand).

Experts from Deloitte say that since 2015, the US has been lagging behind China in investing in 5G networks on average by $ 8-10 billion. This gap may soon affect the global communications market as increasingly more countries and companies are using technologies that require high data transfer speed, such as the Internet of things. As of the end of 2017, two Chinese operators, China Telecom and China Mobile, registered 273 million devices supporting networks in the networks, while two American operators - Sprint and AT&T - had only 52.6 million devices.

source: bloomberg.com






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