Telecom operator considering equity participation, M&As over next five years

 

China Mobile, the country's largest telecom operator, will invest several hundreds of billion yuan into 5G-related industries through equity participation and mergers and acquisitions over the next five years, the company said on Friday.

 

Yang Jie, chairman of China Mobile, said that together with a fund of funds that hit several tens of billion yuan, the company is set to leverage both direct investment and funds to create a 5G ecosystem.

 

"Next year, China Mobile is expected to achieve sound 5G coverage in cities, counties as well as key towns and countryside, while increasing the installed capacity to 1.08 million," he said at this year's China Mobile Global Partners Conference.

 

With the opening of 385,000 5G base stations, Yang said that China Mobile finished its annual 5G target ahead of schedule and has built the world's largest 5G stand-alone network.

 

Though this year's COVID-19 pandemic has disrupted many countries' 5G rollout plans, Chinese telecom companies have been working hard to stick to their schedules after the outbreak was brought under better control in the nation.

 

Wang Hengjiang, deputy general manager of the terminal subsidiary of China Mobile, said that the company has so far sold 85 million 5G terminals and will "definitely" exceed 100 million units by the end of the year.

 

Xiang Ligang, director-general of the Information Consumption Alliance, a telecom industry association, said the moves show that China Mobile has a vast number of 5G users and terminals, and is relatively better funded than its rivals.

 

"Overall, whatever the amount of 5G devices it launches or their price, China is moving much faster than South Korea and the US, the first batch of countries to commercialize the technology, which have unveiled only limited types of 5G smartphones," he said.

 

Wen Ku, head of the information and telecommunications development department at the Ministry of Industry and Information Technology, said China has already achieved its annual 5G construction target ahead of time, with 690,000 5G base stations built by the end of September.

 

"As the country is set to enter a lead-in period in the next three years, China will continue to build 5G networks in a rhythm that is moderately ahead of schedule," Wen said during a recent news briefing.

 

Lead-in period, according to some industry insiders, means that new products, new formats and new models of 5G applications are constantly emerging and that such applications are shifting from single application to large-scale and systemic scenarios.

 

According to the Global System for Mobile Communications Association, the international association of mobile operators better known as GSMA, China has consolidated its position as a global leader in 5G and is set to account for 70 percent of global 5G connections this year.

 

China is also forecast to have 450 million 5G connections by 2025, the most worldwide, driven by significant operator investment and growing enthusiasm among consumers and enterprises, it said.