5G’s first anniversary: ​​Mobile phones and infrastructure are popular, only applications are missing

"We will build 600,000 5G base stations and ship 180 million 5G mobile phones within this year." On June 6, the day when my country's 5G licenses were officially issued for one year, Lu Chuncong, deputy director of the Information and Communications Administration of the Ministry of Industry and Information Technology, announced this year's 5G goals. After experiencing the impact of the new crown pneumonia epidemic, my country's 5G construction is still in full swing, with base station users continuing to increase and 5G mobile phone sales rising. However, the current 5G network coverage is still small, and many users report that the experience is average. Coupled with the lack of revolutionary 5G applications, 5G will still be difficult to popularize in a short period of time. 

Stable development

In terms of base station construction, Lu Chuncong revealed that basic telecommunications companies have built more than 250,000 5G base stations. It is estimated that by the end of this year, my country will have built more than 600,000 5G base stations, covering all cities at the prefecture level and above across the country.

Among them, China Mobile stated that it has built and put into operation 140,000 5G base stations, and strives to complete the goal of building 300,000 5G base stations in 2020 ahead of schedule in the third quarter of this year, and ensure that 5G commercial services will be provided in all cities at the prefecture level and above in the country within the year; China Telecom stated that it has opened more than 140,000 5G base stations, and it is expected that the number of base stations that can provide 5G services to the society will exceed 300,000 by the end of the third quarter of this year; China Unicom’s available 5G base stations have reached nearly 130,000, covering all municipalities, major provincial capitals, and key cities in the Beijing-Tianjin-Hebei, Yangtze River Delta, Guangdong-Hong Kong-Macao Greater Bay Area and other regions. It is expected that by the end of this year, the total scale of China Unicom’s 5G base stations will reach 300,000, covering all prefecture-level cities in the country.

As the number of base stations increases, the number of 5G users has also increased. On May 25, Miao Wei, Minister of Industry and Information Technology, revealed in an interview with the "Minister's Channel" that the number of 5G users increased by more than 7 million in April this year, and the cumulative number of users has exceeded 36 million.

China Telecom and China Unicom have not disclosed the latest number of 5G users. According to data from China Mobile as of the end of May, it has developed more than 55 million 5G package users and plans to develop 100 million 5G package users throughout the year. However, these 55 million 5G package users do not conflict with the 36 million 5G users counted by the Ministry of Industry and Information Technology, because the statistics of the number of operators' 5G package users include the use of 4G mobile phones with 5G packages.

In terms of terminals, Beijing Business Daily reporters observed that the proportion of 5G mobile phone shipments in the entire mobile phone market is steadily increasing. According to data released by the China Academy of Information and Communications Technology, from January to April this year, the cumulative shipments of 5G mobile phones in the domestic market were 30.441 million units, and 65 new models were launched, accounting for 33.6% and 47.4% of the total respectively; in January, the shipments of 5G mobile phones were 5.465 million units, accounting for 26.26% of the total shipments of 20.813 million units.

Lu Chuncong revealed that as of May this year, the cumulative shipments of 5G mobile phones in my country were 59.85 million units, and it is expected to reach 180 million units by the end of this year.

Lowering the threshold

In order to attract users to upgrade to 5G packages and mobile phones, operators and mobile phone manufacturers have recently launched "sincere" activities. On the anniversary of 5G, package prices have begun to loosen. For example, China Mobile's most basic 128 yuan 5G package has been reduced to 89 yuan/month, and China Unicom and China Telecom also have corresponding discounts.

Compared with the issuance of 5G licenses, the launch of 5G packages actually came five months later. On November 1 last year, the three major operators officially launched 5G commercial packages. The pricing model is similar to 4G in that it is priced according to the amount of traffic, and another reference factor is added, which is similar to the current fixed-line broadband business model of selling by speed.

Overall, the price difference among the three companies is not big. Taking China Mobile as an example, its 5G package is named "Smart Package", which is divided into personal version and family version. The price of personal version package ranges from 128-598 yuan. The packages of 128 yuan (30GB traffic) and 198 yuan (60GB traffic) enjoy 5G premium service (network speed is 500Mbps), and the packages of 298 yuan (100GB traffic), 398 yuan (150GB traffic) and 598 yuan (300GB traffic) enjoy 5G ultra-speed service (network speed is 1GMbps). The price of family version package ranges from 169-869 yuan.

Calculated in this way, the discounted price is equivalent to a 30% discount. So, is this price reduction just a temporary promotion or will it last forever? Beijing Business Daily reporters interviewed the three major operators separately. As of press time, China Unicom and China Telecom have not responded. An insider close to China Mobile said, "This is a short-term promotion, but from the perspective of the development of the telecommunications industry, 5G tariff prices must be gradually reduced."

It is reported that due to the high initial investment cost of network construction, 5G users will not grow on a large scale, and operators are under great pressure in the early stage of 5G construction. Therefore, the package price will not be too low, but 5G is still in the process of slow deployment. The price of 4G also gradually transitioned from high to low.

At the same time, the entry threshold of 5G mobile phones is gradually lowering. Recently, Xiaomi's Redmi released the Redmi K30, bringing the price of 5G mobile phones to 1,500 yuan. Since the release of the first 5G mobile phone in China last year, its price has gradually dropped from 5,000 yuan to 4,000 yuan, 3,000 yuan, 2,000 yuan, and then to the 1,500 yuan price range. Compared with 4G mobile phones, 5G mobile phones no longer have any price disadvantages.

Consumer Ms. Bai said, "Since the prices are similar and 5G is also a development trend, I will definitely not consider a 4G phone when changing my phone now."

Mobile phone manufacturers have basically stopped launching new 4G phones, except for Apple. Lu Weibing, vice president of Xiaomi Group, president of China, and general manager of Redmi brand, previously announced that all new Redmi phones priced above 1,500 yuan in 2020 will be 5G phones.

Application shortage

As an information infrastructure, all walks of life will gradually use new technologies such as 5G, AI, and big data in the future. However, the current use of 5G by ordinary users is basically blank.

On the one hand, although the construction scope of 5G base stations is slowly expanding, the network speed in normal life scenarios has not been significantly improved. A Beijing Business Daily reporter previously applied for a new card with a 5G package and installed it on a 5G mobile phone of a certain brand. However, even in first-tier cities such as Beijing, there are not many places where 5G signals can be searched, and the network speed experience under 5G signals is not as good as advertised.

For individual users, 4G speed is sufficient for social networking, surfing the Internet, watching videos or playing games. Therefore, apart from the price factor, many users are not willing to switch to 5G packages. At the 2019 China International Information and Communication Exhibition, a China Mobile technician told the Beijing Business Daily reporter that 100Mbps (4G) speed is sufficient for ordinary individual users, and 500Mbps and 1GMbps speeds are for industry customers, mainly used for live broadcasts or professional scenarios such as Internet of Vehicles and telemedicine.

On the other hand, there are no killer 5G applications for smartphones that users generally rely on. The user experience is nothing more than watching movies and playing games faster than before, but there are no applications that really require 5G. The only clue is that in April this year, the three major operators jointly released the "5G Message White Paper" and are expected to officially launch 5G messages by the end of this year.

"Applications always need fertile soil to grow. When the scale of networks and terminals reaches a certain level, good 5G applications will naturally emerge. From historical experience, all good applications are 'accidentally' discovered and grow in practice, and are not the result of 'forcing growth' in laboratories or imagined by experts." said Ma Jihua, a telecom analyst.

"As for the popularization of 5G, this requires a process. One is network coverage, the other is user acceptance, and the most substantial factor is the usage experience." Communications observer Liu Qicheng pointed out that there will definitely be a breakthrough in the popularization of 5G in the second half of this year. With the acceleration of base station construction, there may be 5G mobile phones priced at thousands of yuan, as well as more favorable 5G packages.

Ma Jihua believes that the popularization of 5G requires the convergence of networks, terminals and applications. At present, network construction is in progress and has not yet achieved the basic capability of full coverage. Terminal replacement also takes time, and 5G applications are still in the planning stage. Overall, 5G will begin to truly scale up by the end of 2020. If 5G applications are to be deeply rooted in the hearts of the people, it is estimated that we will have to wait until the 2022 Winter Olympics.