Foreseeing 2021, eight highlights of the communications industry

2020 is finally over and we usher in the brand new 2021.

Looking back on the past year, I feel deeply moved and as if I were in another world. At this time last year, no one would have thought that an epidemic would sweep the world, change everyone's lives, and take countless lives.

After more than half a year of strict control, we in China have gradually gotten rid of the impact of the epidemic and restored normal order. However, the continued deterioration of the situation abroad has increased the pressure of domestic prevention and control. The new cases that have emerged in various places remind us not to take it lightly.

Fortunately, with the emergence and mass production of vaccines, we are gradually seeing the dawn of victory over the epidemic. The restart and recovery of the whole world is full of expectations.

2021 is an important turning point for the COVID-19 pandemic and human society. Against this backdrop, the development of the communications industry is also facing important historical opportunities.

Overall, our communications industry has not been greatly affected by the COVID-19 pandemic.

2020 is the first year of 5G commercialization. According to the data, the annual 5G base station construction target (700,000) has been successfully completed. 5G SA independent networking commercialization was launched as scheduled. Operators' 5G bidding is also proceeding step by step.

The emergence of the epidemic has not only failed to hinder the pace of communication network construction, but has greatly stimulated the explosion of communication demand. For example, remote office, remote conference, remote class, etc. have become the social norm and are accepted by more and more users. The overall Internet traffic has also increased significantly compared with previous years.

Our country's long-term investment in communication infrastructure has played a huge role in the fight against the epidemic, which has to some extent weakened the impact of the epidemic on our normal work and life.

Through this epidemic, people have realized that communication networks have become a livelihood infrastructure like electricity and water , and are an indispensable resource for our survival.

The new infrastructure strategy launched by the country is a major boon to the information and communications industry. A large part of the funds for revitalizing the economy will definitely fall into the ICT field to promote the sustainable development of the industry. To put it bluntly, information and communications infrastructure paves the way for the digital transformation of all walks of life, and the ultimate goal is still industrial upgrading and productivity innovation.

The epidemic is not an obstacle to the development of the communications industry. The real threat comes from trade conflicts and political suppression.

Under the intervention of external forces, the order of the global communications market is becoming increasingly chaotic. Technology and price are no longer the primary factors in market competition.

Foreign operators who have been subjected to unwarranted political pressure have lost the right to independently choose technology and products, which has increased unnecessary network construction costs and also indirectly increased users' network consumption expenditures. This is actually a setback for human communications.

The atmosphere of technical communication in the industry has become strange, and more and more experts have chosen to remain silent. The unified technical standards that the communications industry has spent decades to form may fall into division again. In the future, we may face two sets of parallel world standards.

Faced with the adverse environment, many companies are forced to spend more money to sort out their upstream and downstream industrial chains. They hope to avoid risks and gain more options and initiative. Business operations should not be subject to such uncertainty.

Everyone hopes that the trade conflict will ease and the industry will return to its previous state of development. However, more and more experts say that the trade conflict situation will not change fundamentally after the new US president takes office. Experts say that we need to be mentally prepared for a protracted war. The situation we need to face in the future is likely to be more severe.

We said earlier that the number of 5G base stations in China has reached 700,000.

In fact, in my personal opinion, although the construction goals were achieved as scheduled, the overall performance of 5G can only be regarded as a medium deviation.

Of the 700,000 base stations, a large portion are outdoor macro sites with 5G antennas installed, and very few are completely new sites. From a cost perspective, this is relatively easy.

However, more than 70% of user traffic comes from indoors. The investment in 5G indoor coverage is even greater. When it comes to the time to really fight, it can be seen that operators are still somewhat hesitant.

On the surface, the number of domestic 5G package users exceeds 200 million. But how many 5G users are there? You should know by observing the situation around you. Many users are "forced to use 5G", with the name of 5G but not the reality.

5G is not a motivation for users to change their phones. The more realistic situation is that due to poor 5G signal coverage, 4G/5G networks are frequently switched, affecting user experience and increasing power consumption. Many users simply turn off the 5G switch on their phones.

The fewer users there are, the more operators want to shut down 5G base stations, and the worse the 5G signal becomes. The worse the 5G signal becomes, the fewer users will choose 5G. This creates a vicious cycle.

Compared with 5G, people are more concerned about the speed of 4G, so much so that many people suspect that operators have artificially restricted 4G in order to develop 5G.

In addition to the mobile Internet, the expected explosion of industrial Internet application scenarios has not yet arrived. Whether it is the Internet of Vehicles, Industrial Internet, smart healthcare, smart education, or smart energy, they are still in the stage of exploration, experimentation, and accumulation. Although there are some landing cases, they are not very successful.

The epidemic has had a huge impact on traditional industries. Under such circumstances, it is inevitable that traditional enterprises will have some concerns when increasing their investment in information and digital transformation. Enterprises spend money in the hope of seeing real returns, and no one wants to be the first to try it.

The popularity of Cat.1 is a rare highlight in 2020. The withdrawal of 2/3G networks has led to the rise of Cat.1. This also fully demonstrates how pale and powerless the fancy technology is in the face of absolute cost advantages .

Many people believe that the development trend of technology is "consumption upgrade". However, feedback from the market tells us that the Internet of Things is a typical "sinking market". Under the premise of meeting the indicator requirements, the technology with the lowest cost will be the final winner.

The popularity of Cat.1 has put NB-IoT and eMTC in a bit of an awkward position. The future of 5G mMTC scenarios is something that equipment vendors and operators should seriously consider.

Compared with 5G access network (base station), operators are willing to invest in bearer network.

In any case, both mobile communications and fixed broadband communications use bearer networks. The growth in the number of 5G users is unclear, but the growth in the number of broadband users is obvious. Moreover, the dedicated line access market from government and enterprise users has always contributed huge profits. IDC data centers are also growing rapidly driven by cloud computing, and there is a strong demand for backbone networks. Operators can make a profit by investing in expanding the transmission network.

In addition to the continued expansion of single-wavelength capacity (the key lies in the cost of 400G optical modules), operators will focus on all-optical 2.0 and network intelligent transformation.

All-optical 2.0, as I have introduced before, is the popularization of all-optical switching such as OXC. Network intelligence is to continue to promote SDN and SRv6 on the basis of IPv6, promote network programmability, AI operation and maintenance, improve network efficiency, and reduce the difficulty and cost of operation and maintenance.

1000Mbps is an important milestone in user network experience.

According to current user needs, the most important high-bandwidth application is still video. For mobile phones, 1080p is basically enough. For fixed-line broadband, home video will not exceed 4K in the short term, and a gigabit network is sufficient. If we blindly pursue higher bandwidth, we will have to bear a sharp increase in costs, which will be difficult for users to accept and pay for.

In the future, 5G gigabit, fixed broadband gigabit, and Wi-Fi gigabit will serve users for at least a five-year technology life cycle. To push the technology standards to a higher level, a revolutionary communication method such as holographic communication will have to become popular.

Cloud-network integration is an inevitable trend in the development of communication networks.

In terms of communication network virtualization (cloudification), the core network is at the forefront. At present, many provinces have completed the migration of 3/4G core networks to virtualized resource pools.

Whether cloud computing can save costs and simplify operations and maintenance is still undecided, but we will have the answer in a year or two.

After the core network, there are the bearer network and access network. The bearer network cloudification has been put into practice and is currently in the exploratory stage. The access network , as the most difficult part of the mobile communication network to cloudify , has made considerable progress.

The continued popularity of small base stations and the continuous news about Open-RAN actually show that everyone is paying attention to the technological trends in this area . Whether they will threaten the market share and whether these technologies can succeed will affect the future landscape of the communications industry .

Mobile edge computing is also a focus that deserves attention.

As an extension of cloud computing, edge computing has visible application scenarios, is not too difficult in terms of technology, and has great market potential. The biggest challenge of edge computing is actually the construction of the ecosystem. The platform itself is actually not profitable.

As the core of the entire communications industry, every move of operators will attract everyone's attention.

After so many years of fierce competition and speed increases and fee reductions, operators at the 4G/5G inflection point are now having a hard time. The heavy asset business model and hundreds of thousands of employees to support have made it difficult for operators to even walk, let alone dance.

If operators do not transform and find new profit growth points, then the future will be increasingly difficult. Closure is impossible, the country will not allow it. But is merger and reorganization possible? In the turmoil, can everyone get out of it unscathed?

The reduction in profits will inevitably affect the welfare of employees. The truly outstanding talents will choose to leave on their own initiative. The loss of talent will increase management pressure, weaken competitive advantages, and further affect profits. This is another vicious cycle.

China Unicom's mixed ownership reform has entered its fourth year. There are different opinions on the effectiveness of the mixed ownership reform. Now that China Unicom and China Telecom are jointly building and sharing 5G, the specific effect also needs further observation. It is impossible to have no problems. It depends on what problems will arise and whether they can be solved.

In terms of radio and television, their investment in 5G will more or less drive the performance growth of the communications industry, but I personally am still not optimistic about the long-term development of radio and television 5G.

The keywords of the year are popular now. In my mind, the keyword of the year for the communications industry in 2020 is "asking for directions", and in 2021, I think it is "patience" .

Patience is needed to further incubate 5G industry application scenarios, mature and develop the industry chain, and evolve and popularize key technologies. The 5G hype is over, and we need to get used to facing the ordinary. Sometimes, loud gongs and drums are not necessarily a good thing, and silence is not necessarily a bad thing.

More patience often brings more fruit, isn't it?