By Tanner Brown
China has begun offering cellphone customers superfast 5G service, a technological leap that comes despite U.S. attempts to contain Beijing’s largest telecom company.
The country’s three state carriers on Thursday formally announced the rollout, laying out their price plans and data speeds. Though commercial operations were formally slated to launch Friday, users reported access on Thursday.
China Mobile Ltd. /zigman2/quotes/204514293/composite CHL -0.82% /zigman2/quotes/204357455/delayed CHLKF 0.00% /zigman2/quotes/200868736/delayed HK:941 +1.38% , China Telecom Corp. /zigman2/quotes/200463528/composite CHA +0.53% /zigman2/quotes/206668971/delayed HK:728 +0.64% and China Unicom Hong Kong Ltd. /zigman2/quotes/205476740/composite CHU -0.58% /zigman2/quotes/203194753/delayed CHUFF -1.12% /zigman2/quotes/205091392/delayed HK:762 +1.19% are offering plans starting around 128 yuan ($18) a month, going up to roughly $100, with speeds up to 100 times faster than existing 4G services, according to the companies’ promotional materials.
Beijing already has some 10,000 operational 5G base stations, and over 100,000 are planned across the country, according to the Ministry of Industry and Information Technology. Though most stations and widest service will begin in the major cities Beijing, Shanghai, Shenzhen and Guangzhou, China Mobile said Thursday that nearly 50 cities will have some degree of 5G service soon after the launch.
The service was originally planned to begin early next year, but was reportedly expedited in the face of U.S. pressure to hobble Chinese telecom giant Huawei Technologies Co., which Washington considers a security threat — a claim Huawei denies. The U.S. has advised allies to refuse to allow the company to help build their own 5G networks, and has disrupted its supply chain by temporarily restricting American companies from selling to Huawei and fellow Chinese telecom-equipment maker ZTE /zigman2/quotes/205386796/delayed ZTCOY -1.43% .
China is not the first country to launch commercial 5G service — the U.S. and South Korea both have small-scale offerings in some cities — but it will be by far the biggest network in the world, due to China’s massive population and widespread adoption of cellphones. China Mobile said it has 900 million existing cellular subscribers, and China Telecom estimated that the country will have 170 million 5G subscribers by next year.
One hiccup in the rollout, however, could be the lack of 5G-ready smartphones. Only a handful have been released so far — mainly by China’s domestic sellers Huawei and Xiaomi /zigman2/quotes/201398274/delayed XIACY -2.81% and South Korea’s Samsung — and they begin at $1,000-plus price points.
Proponents say the next-generation technology will facilitate a revolution in a number of fields.
“This involves accelerating the integration and application of 5G in industries, transportation, energy, agriculture, education and health,” said Chen Zhaoxiong, a vice minister at the Ministry of Industry and Information Technology.
Remote surgeries and autonomous driving are just two areas that are expected to see rapid growth.
Regular consumers may be the first to experience significant changes, however, with data speeds allowing for higher-quality gaming and the near-instantaneous download of high-definition video.
Tanner Brown is a contributor to MarketWatch and Barron’s and producer of the Caixin-Sinica Business Brief podcast.