A Speech Delivered by Zhang Xiaoqiang at the 5G Launch Conference

First, the 5G network is important for the development of the digital economy

The report of the 19th National Congress of the Communist Party of China proposed that we should implement a new development concept, build a modern economic system, focus on improving the quality of the supply and promoting the integration of the Internet, big data, artificial intelligence and the real economy so as to foster a new growth point and create new momentum. To this end, we must increase infrastructure construction including information networks. We must speed up technological innovation and provide strong support for building a digital China and a smart society. The revolution of modern information technology, represented by computer, Internet and telecommunications, has given birth to the digital economy, which is becoming an important source of economic growth, economic transformation and industrial upgrading. According to the statistics of Tencent Research Institute, in 2016, the digital economy in China increased by 16.6% over the previous year, with a total amount of 22.6 trillion yuan, or equivalent to 30.3% of China’s GDP. In the future, China’s big data and digital economy will continue to maintain rapid growth. The existing mobile communication system represented by 4G has been unable to support the rapid development of the digital economy and thus, the construction of the 5G has become a major move in the digital transformation of economy and society.

The integration of 5G with technologies such as cloud computing, big data, artificial intelligence, and virtualization will connect people and everything to become the key infrastructure of the digital economy. With its superior performance of reliability and low latency, the 5G will be widely used in industries like agriculture, education, culture, science and technology. From online to offline, consumption to production, the 5G will bring China’s building of a powerful network and digital economy to a new level.

Second, we should deepen reform and mobilize the enthusiasm of all parties to promote the development of the 5G network

China’s mobile communications industry has gone through different stages and reached a critical period of the 5G network development. The industrial chain has become more mature and the commercial process has developed rapidly. From 2016 to 2017, the basic research and development test of China’s 5G has achieved remarkable results. China Mobile’s 5G network technology test in Guangzhou has been very successful. At the Mobile World Congress 2017 in Shanghai, Huawei demonstrated a 5G core network prototype and ZTE launched the 5G high and low frequency serial pre-commercial products. On November 17 this year, the General Office of the Ministry of Industry and Information Technology promulgated the “Notice on Starting the Third Phase of 5G Technology R & D Experiment” and announced the start of the third phase of the 5G network R&D experiment. Next year, we will take new steps and hopefully, we can achieve commercial application by 2020. To do this, we need to work on the following four aspects.

First of all, we should mobilize all parties to form a joint force. Specifically, we should strengthen cooperation among operators, equipment providers and terminal companies to promote the 5G network development. China Mobile, China Telecom, China Unicom and Huawei, ZTE, Datang and other system equipment vendors, and terminal companies such as millet, OPPO, VIVO should deepen cooperation with each other. Other stakeholders of the 5G network should also further strengthen their cooperation, such as the automobile industry, logistics industry and smart city development.

Secondly, we should increase the investment in the 5G network. The central government has always attached great importance to the development of the 5G network and is giving strong support through the National Science and Technology Major Project of “Next Generation Broadband Wireless Mobile Communication Network”. This special project will be completed in 2020 and the state should promptly launch a new national major project plan after 2020, so that continuous support will be given to the development of the 5G network and industrial ecology. The massive investment made by the telecom enterprises has created brilliant communication facilities for “public entrepreneurship and innovation” and has led to the development of a large number of innovative technologies. For instance, the rapid development the Internet companies (such as Tencent and Alibaba), shared economy (such as sharing bikes) is based on the construction of the network. Research Report Estimates that China’s investment and capital expenditures on the R&D of the 5G network will be more than 1.1 trillion U.S. dollars from 2020 to 2035.We should further increase the investment through the reform of SOEs mixed ownership. The telecom company Unicom has taken an important step in the reform of mixed ownership, Tencent, Alibaba, Baidu and other Internet companies are also actively involved, which will enrich the financial resources for China’s 5G network construction, create a more flexible institutional mechanism and bring better interaction with users.

Thirdly, we should optimize the allocation of national spectrum resources. Spectrum is crucial to the 5G network development and must be planned as early as possible to play a leading role in industrial distribution and international spectrum coordination. China has made significant progress in the 5G network frequency planning this year. The Ministry of Industry and Information Technology has planned a total of 200MHz frequency for the 5G spectrum, but it also faces many challenges. For example, the 700MHz spectrum is planned for mobile broadband services in major countries such as the United States and Europe, but in China, it is still only used for radio and television services. The allocation of the 5G spectrum involves many departments and thus, it should be decided by the central government to achieve multi-dimensional spectrum sharing in frequency domain, time domain and airspace. By doing so, it will provide enough low and high frequency spectrum resources for the development of China’s 5G network.

Last but not least, we should strengthen coordinated development of the next generation of Internet, Internet of Things. For example, the global IPV4 address was exhausted by the end of 2016 except Africa. The 750 million Internet users in China have only 338 million IPV4 addresses. When China’s 5G starts large-scale commercial use, the number of terminals accessing the Internet will exceed 10 billion. On November 26, the General Office of the CPC Central Committee and the General Office of the State Council issued the “Action Plan for Promoting the Deployment of the Internet Protocol Sixth Edition (IPV6)”, which clearly defined the significance of promoting the deployment of the IPV6 and put forward the general requirements and major objectives. According to the “Plan”, China will take 5 to 10 years to form its own technology system for the next generation of Internet, build the world’s largest IPV6 commercial application network so as to realize the integration of the next generation of Internet and various fields of the economy and society. This is very important for the development of China’s Internet and 5G network. The Plan proposes that there will be 200 million active users by the end of 2018 and 500 million by 2020. The development of the next generation of Internet with massive scale and better security will give full play to the high-speed features of China’s 5G network and demonstrate synergies in chip technology research and development, application technology, network construction and industrial chain.

Thirdly, we should stay open-minded and achieve win-win cooperation

The 19th National Congress of the CPC put forward the formation of a new comprehensive opening-up, including strengthening cooperation in innovation capability. China will promote international cooperation in the 5G network with an open manner.

China will strengthen international cooperation in the standards and application of the 5G network. A unified standard for the 5G network is not only the basis for roaming and development, but also conducive to the formation of economies of scale. Therefore, we should form a unified global standard by strengthening cooperation across countries and enterprises. China now has 1.3 billion mobile users, of which 900 million are 4G users, who will become the 5G users. In 2030, the value chain of China’s 5G will reach about 1 trillion U.S. dollars, one-third of the global total. The huge technology, equipment and user market belong to the world. We will, with an open mind, realize win-win outcome with the countries along the Belt and Road, developed and developing countries.

All countries around the world should also maintain open and cooperate with each other. Some agencies in the United States and Europe have concerns over the cooperation with China in information industry. In the past, they took sanctions against Huawei and ZTE for security reasons. I think that these differences can be resolved by discussions. We should work with a positive attitude and cooperate with an open mind. Under the precondition of ensuring information security and the security of cross-border data flow, we can strengthen supervision, achieve win-win outcome and jointly promote the development of the 5G network, so as to make greater contribution to world prosperity and peace.