China Mobile 5G subscribers base reached 15.4 million by the end of February, thus becoming the leading operator in the 5G network. The company also grew its 4G client base by another 25.21 million, reaching 758 million 4G subscribers. In total, the mobile operator has over 950 million mobile subscribers.
The growth of China Mobile’s 5G subscribers
China Mobile’s growth in 5G subscribers has been consistent. In December 2019, the company had 2.55 million subscribers. At the start of the year in January 2020, China Mobile 5G subscribers reached 6.74 million. The Chinese telecom giant targets to reach 70 million 5G subscribers by the end of 2020.
Apart from the rise in 5G subscribers, the company experienced a 17.1% rise in its broadband business, reaching 187.04 million users in December 2019. During that period, the company lost 609,000 fixed broadband customers compared to 694,000 customers it had added in November 2019. In October 2019, the company had an increase in the broadband customer base with 1.9 million. The Chinese operator also has an additional 884 million IoT customers.
China’s 5G network timeline
Despite China’s initial laxity in launching commercial 5G services, the country has picked up the trend, catching up and even overtaking countries such as the United States and South Korea. The 5G rollout began in June 2019 when the Ministry of Industry and Information Technology issued 5G permits to China Mobile, China Unicom, China Telecom, and China Broadcasting Network. By November 2019, all but China Broadcasting Network had announced the launch of their 5G mobile services. The three companies started their 5G services by offering 5G plans at a monthly cost of around $18 (¥128).
The 5G rollout is expected to mature in just 10 months compared to 4G coverage that took 46 months. China Mobile selected Nokia, ZTE, Ericsson, and Huawei as 5G network equipment providers with the Shenzhen-based manufacturer providing half of the orders.
The Chinese government once hinted at taking retaliatory actions against Western 5G equipment providers should Huawei be banned from 5G networks in Western countries. Nokia and Ericsson would take the hit if the Chinese government decided to take retaliatory measures.
China Mobile’s 5G coverage and initiatives
China Mobile runs over 50,000 5G base stations in 50 cities across the country with over 200 critical capabilities. The company hopes to add 340 cities in 2020, providing access to over 600-700 million people. The telecom giant also plans to have over 300,000 5G sites across China. Apart from the domestic market, China Mobile is involved in 61 international 5G projects. The telecoms giant also boasts of over 2,000 5G patents. The company has announced new tenders for a new 5G rollout phase. At the same time, China Mobile is working to acquire 232,000 5G base stations to expand 5G coverage in an additional 28 regions in the country.
According to Jang Yie, China Mobile’s chairman, the company is taking a systematic approach to planning and steadily implementing its “5G+” initiatives. It will, therefore, undertake “extensive 5G deployment, covering more sectors and creating greater efficiency and social value.”
However, the company’s 5G rollout and deployment plans have faced challenges from the ongoing coronavirus epidemic. Despite the setback, the same outbreak has caused more consumers and businesses to go online and embrace digital and cloud-based services.
Considering the size of China’s population, the Chinese consumer 5G market is likely to be the largest. The enthusiasm of the population and the availability of 5G devices are expected to keep this trend up even after the 5G buzz is over.
The downside of the rapid growth
Despite the rosy picture painted by the excellent growth figures, China Mobile is struggling with the industry’s trend of falling profit margins. The company is facing competition from other operators amidst declining data traffic. This trend was because of government pressure to increase efficiency and reduce data costs. The result of these events was falling in share earnings by 9.5%. At the same time, operating revenues rose by only 1.2%, while the rise in profits from telco services was only 0.5%.
The company intends to take advantage of emerging technologies to create new business models. The company also hopes to benefit from the rise in demand for connectivity as the basis of operations due to the increase in users’ requests for digital services.