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AMTD Global Tech Biweekly vol.21 Summary

Core Content Overview

This document provides an analysis of the 5G investment cycle in China and highlights key developments in the tech sector during the week of 2 April 2020. It also includes updates on various companies and technologies, such as Microsoft, Apple, Xiaomi, Samsung, and others, in the context of the global shift towards remote work and 5G deployment.

5G Investment in China

China Big3 Telecom Operators Capex Cycle

• 2019 Investment: The total capex of the China Big3 (China Mobile, China Unicom, China Telecom) was RMB299.9 billion, with RMB41.2 billion allocated to 5G.
• 2020 Investment Forecast: The total capex is expected to reach RMB334.8 billion, with 5G investment forecasted at RMB180.3 billion.
• 5G Investment Percentage: 5G investment accounted for approximately 13.7% of total capex in 2019, and is expected to rise to 53.9% in 2020.

5G Application Categories

ITU has defined three major 5G application categories:

1. Enhanced Mobile Broadband (eMBB): The first phase of 5G rollout, offering faster speeds and broader connectivity.
2. Massive Machine Type Communications (mMTC): Supports high device density, deep coverage, and low power consumption, ideal for smart city and IoT applications.
3. Ultra-reliable and Low Latency Communications (URLLC): Focuses on mission-critical applications such as autonomous driving and remote surgery, with low latency and high reliability.

Deployment Phases

• NSA (Non-Standalone) Phase: Initially focused on eMBB.
• SA (Standalone) Phase: Expected to be realized by the end of 2020, with China Telecom aiming for commercialization in Q4 2020.
• Release 16: Expected to enhance support for URLLC and set the stage for more advanced 5G capabilities.

5G Investment Plans of China Big3 Operators

Key 5G Developments by China Big3 Operators

• China Telecom:

  • Launched 5G commercial services in 50 cities in October 2019.
  • Introduced a membership-based service model for individuals and households.
  • Deployed 5G services for smart cities based on SA architecture in Shenzhen.
  • Led the global 5G SA industry chain in formulating "5G SA Deployment Guidelines".

• China Unicom:

  • Entered into a cooperation agreement with China Telecom for joint 5G network development.
  • Collaborated with key industry players to create 5G applications and promote ecosystem growth.

• China Mobile:

  • Fully implemented the "5G+ plan" since June 2019.
  • Launched 5G commercial services in 50 cities.
  • Integrated emerging technologies like AI, IoT, cloud computing, big data, and edge computing into 5G.
  • Led 61 5G key projects and owns over 2,000 5G patents.

Tech Sector News Update

Important Disclosures

• The report is prepared by AMTD Global Markets Limited and is for selected clients only.
• It is not an offer to sell or a solicitation to buy any security.
• No personal advice or recommendation is provided.
• The information is based on reliable sources but is not guaranteed for accuracy or completeness.
• AMTD Group does not accept responsibility for any use or reliance on the report.
• The report is strictly confidential and may not be reproduced or redistributed without prior consent.