With efforts to develop 5G mobile standards close to closing, China is transforming itself from a follower of the telecommunications industry to a leader in technological innovation.
Investor company Jefferies stock analyst Edison Lee said, "Although the number of users and the size of the network is China's largest mobile phone market in the world, other countries have an advantage in mobile technology innovation. 5G is an opportunity for China's century." The 5G standard will be officially completed in 2019, which will lay the foundation for mobile operators to launch 5G services on a large scale in 2020.
According to Edison Lee, China’s efforts to gain a higher share of the 5G standard intellectual property will not only increase its global influence, but also increase its bargaining power when negotiating with foreign patent holders. Reduce the cost of Chinese telecommunication equipment manufacturers, chip companies, and other companies in the telecommunications equipment supply chain.
According to the GSM Association, as the latest mobile communication technology, 5G will open a new era, the network can adapt to applications, and the performance can be precisely adjusted to better meet the needs of users. The International Telecommunication Union has stated that the future universal 5G standard will support the following indicators: 1 million connected devices per square kilometer; 1 millisecond delay; higher energy and spectrum usage efficiency; peak download rate can reach 20 Gbps.
In the development of 5G standards, the International Telecommunication Union cooperated with the 3rd Generation Partnership Project. According to Edison Lee, China is keen to increase its share of the phase 2 mobile technology intellectual property in the 5G specification. Although not backward-compatible with 4G networks, Phase2 is based on a new design that can meet the minimum data rates of Gbps, the massive device connectivity, ultra-low latency, and reliable services for the three major 5G usage scenarios.
Edison Lee said, "Due to the bad experience in the 3G era, China is determined to become a major force in 5G technology and gain a relatively high share of intellectual property rights. Several Chinese entities have actively participated in the research and development of 5G technology." Huawei ZTE is a leader in China's 5G related technology development. The two companies recently stated that they are cooperating with China's three major telecom operators to test related technologies and help them plan 5G network deployment.
LexInnova Technologies, a US-based legal services and technology consulting firm, estimated earlier this year that China had about 10% of "5G critical" intellectual property in the areas of wireless access, modulation and core networks. Among Chinese telecommunications entities, Huawei holds the largest number of intellectual property rights, followed by ZTE.
Edison Lee said, "We believe that China's share of the 5G standard intellectual property is very likely to be higher than 10%." China did not participate in the development of the 2G standard and tried to promote the development of the 3G standard called TDSCDMA. TDSCDMA is one of three global 3G standards. Qualcomm had objected to China’s claim that it had TDSCDMA intellectual property, saying that TDSCDMA is based on its CDMA technology. Both parties later reached a settlement in private.
In the 4G era, China supports one of the two major global standards known as TDLTE. Nonetheless, Huawei and ZTE failed to enter the top ten 4G IP holders. According to iRunway, a technology consultancy, the top five companies that hold 4G intellectual property rights are Qualcomm, Samsung, Intel, Ericsson, and Nokia.
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