With the issuance of 5G licenses, is spring coming for mobile phone manufacturers?

According to Jiwei.com, four months earlier than generally predicted by the industry, CCTV had announced a few days ago that 5G licenses would be issued in the near future. Sure enough, today, on June 6, the Ministry of Industry and Information Technology officially issued four 5G licenses to China Mobile, China Unicom, China Telecom and China Radio and Television, which means that China has officially entered the 5G era.

      Many people may not understand the specific significance of the issuance of 5G licenses, which has an impact on the industry, market, terminals and consumers.

      With the issuance of licenses, the 5G industry will move from the trial stage to formal commercial use. The trial commercial stage is more about verifying the consistency and operability of the system, which is more technical; while in the formal commercial stage, more application terminals will join in, and more 5G applications will be developed, gradually shifting from the industrial technology level to the application level.

Simply put, for operators, equipment vendors, and terminal manufacturers, the issuance of licenses allows them to "openly" carry out 5G work, and for consumers, the use of 5G will also show geometric acceleration.

      How is the current coverage of 5G network?

      The issuance of 5G licenses was much earlier than expected, which is of great benefit to operators. They can make overall 5G plans as early as possible, because the early 5G network coverage construction was only in small areas of pilot cities. With the official licenses, they can make more scientific and overall plans.

      Although the Ministry of Industry and Information Technology did not explain in detail the frequency band information obtained by the three major operators and the Radio and Television Bureau at the 5G license issuance site today, according to the previous 5G test frequency band planning, my country's 5G test frequency is 3.4G and 3.5G related frequency bands. China Mobile obtained 100 MHz in the 2.6G frequency band and 200 MHz in the 4.9G frequency band; China Unicom and China Telecom obtained 100MHz spectrum resources around 3.5GHz. If nothing unexpected happens, the three major operators will obtain the right to use the above frequency bands.

      From the perspective of industry support, China Unicom and China Telecom have relatively strong industry chain support for their experimental frequency bands, which can reduce construction costs. China Mobile has a larger bandwidth, but the maturity of the 2.6GHz band is lower than that of the 3.5GHz band, so China Mobile requires greater construction costs.

      In fact, in the 3G and 4G eras, in order to balance the strength of the three major operators, China Mobile has always been a pioneer in developing frequency bands that are not very mature in some industries, while China Unicom and China Telecom have relatively more support from the industry chain. This is because China Mobile is much larger than China Unicom and China Telecom in terms of size, so it has more sufficient funds and is more suitable to be a pioneer. In short, although China Mobile's 5G test frequency band industry support is a little worse, with China Mobile's industry leadership ability, I believe that the competition with China Unicom and China Telecom will continue.

      Since China Telecom launched 5G trials at the end of 2017, it has actively carried out 5G technology trials in cooperation with many domestic and foreign companies, and has now built 5G test networks in 17 pilot cities.

      China Mobile has launched large-scale 5G network trials in five cities, including Hangzhou, Guangzhou, Shanghai, Wuhan and Suzhou, and has built 5G business demonstration test networks in 12 cities including Beijing, Chongqing, Tianjin, Shenzhen and Xiong'an. It will provide 5G services in more than 40 cities by the end of September this year.

      China Unicom announced the "7+33+n" 5G network deployment at the Global Industry Chain Partner Conference on April 23, providing continuous coverage in urban areas of seven cities, including Beijing, Shanghai, Guangzhou, Shenzhen, Nanjing, Hangzhou and Xiong'an, achieving hot spot coverage in 33 cities, and customizing 5G network specialized networks in n cities to build various industry application scenarios.

      The 5G network deployment of the three major operators is accelerating. It is expected that by the end of the year, 5G networks will achieve continuous coverage in the first- and second-tier cities across the country, and hotspot coverage in the third- and fourth-tier cities.

      Has the spring arrived for mobile terminal manufacturers?

      Friends who follow the mobile phone industry know that in the past one or two years, as the growth space of the entire market has been compressed and the replacement cycle has been lengthened, mobile phone shipments have gradually declined. Now the issuance of 5G licenses is expected to be of great help in promoting a new round of replacement.

      In today's world of lack of innovation and excess performance in mobile applications, consumers can use a 4G flagship phone for more than two years, or even longer. The innovation and development of applications are slow, and the 4G network can already meet the needs of applications, so consumers have little motivation to change their phones.

      However, the arrival of 5G network brings about a huge qualitative change compared to 4G network. If consumers want to use 5G network and new applications, they must replace their mobile phones with those that support 5G network.

      Faced with the wave of phone replacements due to the arrival of 5G networks, mobile phone manufacturers have made preparations early. Previously, Huawei, OPPO, and Xiaomi have all launched their own 5G phones. Huawei launched the folding screen 5G phone MateX, which will be released in China this month if nothing unexpected happens; OPPO launched the Reno5G version, which has been sold in Switzerland earlier, and is also cooperating with China Unicom for user-friendly experience in China; Xiaomi also launched the MIX3 5G version, which has been officially sold in Switzerland and other European countries. Of course, manufacturers including vivo, OnePlus, and Nubia have all stated that they are ready for commercial use.

      After my country's smartphone market entered the stock market in the past two years, the user replacement cycle has lengthened and the decline in shipments has made life difficult for many mobile phone manufacturers.

      Although 5G is a great opportunity, it is also a big challenge for mobile terminal manufacturers. In addition to reserving 5G terminal technology, they also need to cooperate with operators and the industry chain for testing. Of course, the initial cost of 5G will also be very high. If any link is not done well, they will fall behind in the 5G era.

      Of course, in the 5G era, if consumers want to experience the speed of 5G, they must buy 5G phones and replace 4G phones. Therefore, this huge hardware requirement for replacement will inevitably drive the next round of replacement wave, which is a great opportunity for mobile terminal manufacturers and they must seize it.

      Can I buy a 5G mobile phone this year?

      Although the 5G license has been officially issued, it is more of an "official" key to give the industry an open door to 5G. It will probably take at least a year for the industry, network, and terminals to truly mature.

With all the 5G promotions in the current market, consumers will definitely have questions: Can we use 5G networks and switch to 5G mobile phones this year?

      The answer is actually no. 2019 will be the first year of 5G, but it will slowly enter our lives in 2020. There are several reasons for this:

      1. 5G network construction is still in its early stages, and both network coverage and quality are imperfect. The three major operators have only deployed 5G networks in key first-tier cities, and the network is still in the testing stage, and the network is not stable enough.

      Second, 5G mobile phones are still rare. Although mainstream leading mobile phone manufacturers have launched 5G mobile phones, they are still a minority. On the one hand, this is related to 5G mobile phone technology. Small and medium-sized manufacturers need to wait for the industry chain or leading companies to improve 5G solutions. On the other hand, in fact, from the chip level, all aspects are not very mature, because current 5G mobile phones are basically implemented through external basebands, which may encounter problems such as high heat generation and short battery life.

      3. The price of 5G mobile phones will be very high at this stage. For example, Huawei Mate X is priced at 2,299 euros, which is equivalent to nearly 18,000 yuan; OPPO Reno 5G version is priced at 899 euros, which is also nearly 7,000 yuan; Xiaomi MIX 3 5G version is relatively cheap, 599 euros, which is less than 5,000 yuan. At this stage, 5G mobile phones are indeed too expensive.

Xiang Ligang, chairman of the China Information Consumption Alliance and an expert in the field of communications, said in an interview with reporters that some 5G mobile phones may be available soon this year, but the prices will be relatively expensive, generally exceeding 10,000 yuan. However, by the middle of next year, many mobile phones priced between 3,000 yuan and 5,000 yuan will appear, and by the second half of next year, more mobile phones priced at 2,000 yuan will appear. "It will take about a year for ordinary people to use affordable 5G mobile phones."

China Mobile once predicted that the price of 5G terminals will be around 5,000 yuan by the end of 2019. By the end of 2020, 5G terminals will drop to the mid-to-low price range, and the price of some 5G mobile phones may drop to around 1,000 yuan.

Telecom analyst Fu Liang said that after the issuance of 5G licenses, the price of 5G mobile phones is expected to drop to around 3,000 yuan by the beginning of next year, when most consumers will be able to afford it, and 5G users will also enter a stage of explosive growth at the beginning of next year.