China Mobile has been the most visible driver of advanced 5G-enabled technologies, among the country’s three operators. However, China Telecom is also investing heavily in devices and platforms that are designed to ensure that its 5G launch, next year, supports new experiences and revenue streams, not just faster mobile broadband. In particular, it is driving specifications for a combined 5G/AI smartphone into the device ecosystem, looking to encourage wide availability of affordable products that will push new experiences to consumers and prevent ARPU erosion. And it is heavily focused on services that require low latency, describing, in its latest financial report, its investment into platforms to support that aspect of 5G.
The telco said it was implementing a next generation cloud platform and virtualized 5G network, which would be “industry leading” in latency. Its roll-out plan includes building a large number of micro-data centers at the edge of the network to reduce latency further and support advanced applications for gaming, training, tourism and other use cases; as well as non-smartphone devices such as smart glasses.
China Telecom has been trialling some of its new technologies and applications on 1,000 pre-commercial 5G base stations across 17 cities. Among the services the telco is trialling, which tap into its low latency platform, are remote controlled vehicles, virtual reality live broadcasting and smart grid. In the latter case, Telecom has made much of a demonstration of network slicing, with an optimized piece of the network virtually set aside for the electricity sector’s demanding requirements.
Like the other Chinese operators, Telecom is seeking to keep 5G capex under control, leveraging existing investments in fiber and cloud, and spreading the cost over as many as 10 years to come. In 2019, direct 5G investment will be only 12% of its total projected capex at CNY9bn ($1.34bn), though that total spending of CNY78bn ($11.6bn) will be up 4% on last year, a recovery after a sharp drop of almost 8% in 2017-2018. And capex spend on “information and application services” will rise by 21% year-on-year to about CNY10.5bn ($1.56bn), with much of that being related to 5G services.