An illuminated 5G sign hangs on the opening day of the MWC Barcelona in Barcelona, Spain, on Monday, February 25, 2019, behind a network of electronic cables.
Angel Garcia | Bloomberg | Getty Images
China has kicked off the launch of the next-generation 5G networks by its large state-owned mobile operators. This is partly a reaction to the ongoing trade war with the US.
The country's Ministry of Industry and Information Technology issued 5G licenses to China Telecom, China Mobile, China Unicom and China Radio and Television on Thursday. This means that these network operators can introduce commercial 5G applications. They received a test license at the end of last year.
The 5G network standard is considered critical as it can support not only new applications such as driverless cars but also the next generation of mobile devices.
Even after the licenses have been granted, there is no guarantee that the networks will start immediately with the introduction of 5G services. However, some companies have announced that they will start this year.
The GSMA, a trade organization representing mobile networks worldwide, said the largest number of 5G ports in China in 2025, according to the latest report, more than in North America and Europe combined. The GSMA expects China to reach 460 million 5G links by the end of the year.
If China starts this year with the introduction of 5G, it will be one of the first to do so. Some US companies like Verizon have introduced 5G in a limited number of cities. Carriers in the UK and South Korea have also introduced 5G services.
China Unicom said in a statement released by the Hong Kong Stock Exchange that it would make "dynamic and accurate investment in 5G structures," but did not specify a timetable. The other airlines did not immediately respond to a request for comment when contacted by CNBC.
"Race to 5G"
China's attempt to grant licenses is due to growing tensions in the US trade wars, increasingly focusing on technology and 5G. Even US President Donald Trump has suggested that the network standard is a battleground: "The race for 5G is open and America has to win," he said earlier this year.
The Trump government has targeted Huawei, the world's largest manufacturer of telecommunications equipment Neil Shah, director of research at Counterpoint Research, said that the timeline is on a blacklist restricting access to US technology ̵
"more aggressive" with services expected to be rolled out this year.
"First and foremost, the technological cold war continues, and China does not want to lag behind the US and Korea," Shah explained, explaining why China's 5G
"Second, in the light of the Huawei trade ban, (Chinese officials) want to provide Huawei with an early basis for using their equipment and launching it before they have access to US components and equipment." he added, "Huawei may have had several months to introduce this product. Accordingly, China is expected to begin launching at the end of this year prior to the Chinese New Year so that the Chinese New Year can be used to leverage 5G smartphones and 5G plans. " The Chinese New Year is a major holiday at the end of January 2020.
– Additional coverage by Hilary Pan of CNBC.
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