china’s regulatory blueprint for 5g success

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Publication date:

May 2021

Author:

Stephen Myers

China’s Regulatory Blueprint for 5G Success

Commissioned by

China’s Regulatory Blueprint for 5G Success 01

© 2021 Omdia. All rights reserved. Unauthorized reproduction prohibited.

Contents Summary 2

China’s 5G rollout to date 3

Facilitating the rollout of 5G in China 5

Case study: Shenzhen 8

Case study: Beijing 10

Case study: Shanghai 11

Conclusion 12

Appendix 13



Summary

China has set itself the target of being a global leader in 5G technology. The “13th Five-Year Plan for

the Development of Strategic Emerging Industries (2016–20)” elevated the development of the

information technology sector and promoted the development of infrastructure to allow the country

to become an internet superpower (网络强国). The plan included an acceleration of the

construction of next-generation wireless broadband networks and promotion of the joint research

and development, testing, and precommercial pilot of 5G technologies. These ambitions have

continued in the 14th five-year plan for the period 2021–25 approved in March 2021.

In addition, 5G networks have been identified as a key component of China’s “New Infrastructure”

campaign to drive the economic recovery from the COVID-19 pandemic. Alongside artificial

intelligence (AI), data centers, smart transportation, and smart energy infrastructure, 5G has been

further prioritized for investment to boost economic activity and drive the country’s long-term

international competitiveness.

Accelerating 5G’s rollout and application development is only possible through the combination of

• Strong domestic operators willing to invest in 5G services

• A supportive regulatory environment that encourages rather than hinders 5G progress

China, through government support at national, provincial, and municipal levels, has created a

regulatory environment conducive to the rapid deployment of 5G networks and the development of

the 5G ecosystem. Action plans for 5G are in place at the national and local levels; the industry

structure favors a high level of infrastructure sharing; and deployment barriers for both macro and

small cells have been lowered.

With this support, and accelerated investment by service providers, China ended February 2021 with

792,000 5G base stations, with leading cities announcing contiguous coverage. With more than 260

million active 5G subscriptions at the end of February 2021, China has now solidified a leading

position in the global 5G ecosystem.



China’s 5G rollout to date

Sustained investment during 2020 has established China in the top tier of 5G markets. Spectrum was issued to the three incumbent operators in June 2019, services were launched in the following November, and the Chinese market has now passed 260 million active 5G subscriptions, according to Ministry of Industry and Information Technology (MIIT) figures. The Chinese operators have started rollout of standalone 5G networks and are developing a strong ecosystem of partners to use the enterprise features in releases 16 and 17 of the 5G standards.

Milestones in 5G deployment achieved in China include

• Deployment of the world’s largest standalone 5G networks in November 2020

• Citywide coverage of Shenzhen announced in August 2020, with 46,480 base stations providing coverage to a population of 12.5 million residents

• Strong migration of mobile customers to 5G-ready plans, with 29% of China Telecom’s, 27% of China Unicom’s, and 18% of China Mobile’s customers signing up to 5G plans.

Rollout progress The MIIT has reported that by end-2020 the number of 5G base stations had reached 718,000. This easily passed targets for 2020 that suggested China would finish the year with about 630,000 base stations. In the first two months of 2021, 74,000 5G sites were deployed.

Coverage has been extended to all of China’s provinces, with 5G services available in all the 299 prefecture-level cities (urban centers with a nonrural population of over 250,000). When services were launched in November 2019, coverage was made available in parts of 50 cities.



Figure 1: 5G base stations deployed in China

Source: MIIT as reported in Chinese media

5G coverage in key cities With the support of vendors and provincial and municipal governments, the deployment of 5G coverage has been prioritized. In cities such as Shenzhen, the provincial and municipal governments have facilitated coverage as a platform for the development of the 5G ecosystem. Equipment suppliers, such as Huawei, have also supported these efforts to place their hometowns at the forefront of 5G adoption and to create a ready environment for the development of new 5G-supported solutions.

Notable coverage announcements have included the following:

• In August 2020 the Mayor of Shenzhen announced the city had achieved full coverage following the deployment of 46,480 base stations. Shenzhen was one of the 5G pilot markets and had ended 2019 with 15,500 5G sites.

• In September 2020 the MIIT announced that Beijing had become the second Chinese city to achieve full 5G coverage. At that point more than 44,000 base stations had been rolled out with the total expected to reach 50,000 by the end of the year.



Facilitating the rollout of 5G in China

China’s ability to roll out hundreds of thousands of 5G sites over the last 12 months is the result of a concerted effort over several years. National leadership and local action plans have ensured that the commercial and regulatory environment for 5G is supportive.

Infrastructure access regime China’s initial facilities-sharing regime was introduced in 2008 with the “Emergency Notice on the Facilitating of Joint Construction and Sharing of Telecommunications Infrastructure.” This directive established a group to coordinate joint construction and sharing of sites.

This regime was further developed between 2014 and 2018 with “Implementation Opinions on the Promotion of Joint Construction and Sharing of Telecommunications Infrastructure.”1 During this period China Tower and the provincial tower businesses were incorporated into coordination efforts, and municipal and provincial telecommunications planning departments were encouraged to involve facilities builders/owners in their planning processes.

One effect of these regulations is to effectively preclude service providers from building towers and indoor antenna systems, giving China Tower responsibility for the coordination of builds and colocation of equipment.

Pole and building design specifications To encourage the deployment of small cell equipment, China has developed design standards to encourage the deployment of 5G on utility poles. This includes development of a national standard for “Specifications for functions and operation management of smart multifunction poles in smart cities” (智慧城市智慧多功能杆服务功能与运行管理规范) by the National Technical Committee

for Standardization of Urban Public Facilities Services(全国城市公共设施服务标准化技术委员会). With multifunction poles combining communications, lighting, traffic controls, CCTV, and other facilities, these standards address a range of issues including functional classification, application scenarios, data sharing, security requirements, system construction, operation, and maintenance.

China has also integrated 5G into its property development process. Led by municipal and provincial governments, building developers are required to ensure their projects consider 5G needs at the

1 Circular [2014] No. 586, Circular [2016] No. 142 Circular [2017] No. 92, Circular [2018] No. 82



planning stage so that opportunities for integration of 5G deployment into the construction process are realized.

Huawei has been supporting standardization of site design with its Open Site initiative. The global Open Site initiative looks to bring together partners across the ecosystem to develop standards that will streamline site approvals and facilitate the integration of telecommunications equipment during building construction and on multifunction poles.

Municipal infrastructure access policies In 2017 the MIIT was involved in the development of the “Notice to Strengthen Wireless Communication Tower Site Planning and Management.”2 This regulation directed governments at all levels to support the development of telecommunications tower infrastructure and include sites in government planning processes and so streamline access processes. China Tower has entered into agreements with all provincial governments and many municipal governments to gain access to civil infrastructure including poles, ducts, and other street furniture.

Industry structure and cobuild agreements Site and infrastructure sharing are high priorities in the Chinese telecommunications market. In 2015, the site assets of the mobile operators were brought together in the jointly owned infrastructure business China Tower. The strategy of China Tower is to maximize asset utilization by colocating the wireless equipment of the service providers on its infrastructure portfolio.

China Tower brings together three asset groups key to the deployment of 5G:

• Two million towers and sites used for 3G and 4G services

• Access to 12 million poles through agreements with municipalities

• Shared passive infrastructure for in-building coverage in the form of distributed antenna systems

The current deployment has used existing macro sites for outdoor coverage. As 5G coverage is expanded and indoor coverage becomes paramount, indoor access and access to poles and other municipal infrastructure will become key. China Tower has been given the role of centralizing and facilitating this next stage of the 5G rollout.

2 Circular [2017] No. 234



Figure 2: 5G cooperation in China

Source: Omdia

Deployment by the service providers has also been accelerated through the cobuild agreements

between China Mobile and China Broadcasting Network and between China Unicom and China

Telecom. These agreements pool the resources of the partners, allowing an accelerated rollout

to sites. China Unicom and China Telecom have jointly installed more than 300,000 5G base

stations across the country, saving over CNY60bn ($9bn) in capital expenditure.



Case study: Shenzhen

Shenzhen, as a key technology hub and 5G pilot city, has looked to promote the development of the 5G ecosystem and led the country in rolling out 5G services. Plans kicked off with the Shenzhen “Fifth-Generation Mobile Communications Innovation and Development Action Plan (2018–20),” setting the foundation for Shenzhen to become the first city in China to announce citywide 5G coverage.

Central to Shenzhen’s efforts has been its September 2019 policy “Measures for Shenzhen to Achieve Full 5G Infrastructure Coverage and Promote High-Quality Development of the 5G Industry.” This policy addressed five areas:

• Ensure the coordination of 5G infrastructure planning and construction:

– Organize telecoms operators, tower companies, and municipal infrastructure investment companies to prepare a citywide information and communications infrastructure plan.

– Plan infrastructures such as data centers, communications equipment rooms, base stations, multifunctional smart poles, and communications ducts based on 5G requirements.

– Support the municipal infrastructure investment company and tower company to jointly build 5G public infrastructure and enable the construction of 5G base station sites and related infrastructure such as telecommunications rooms, pipelines, and power supplies.

– Strengthen the construction of 5G infrastructure information systems, and incorporate information about infrastructure resources such as macro base stations, micro base stations, indoor distributed systems, small 5G equipment rooms, poles, and ducts into a unified resource database to build a single map of infrastructure resources.

• Take the lead in opening public space resources free of charge. This included compiling a catalog of public resources (government property, municipal parks, subways, airports, and municipal poles and towers) and making it accessible free of charge (except for necessary costs and management fees, not exceeding CNY500 [$76] per month).

• Encourage the sharing and opening of communication duct resources. The municipal assets management committee was directed to oversee the municipal infrastructure investment company’s integration of 5G requirements into municipal and district pipeline resources.

• Accelerate the construction of multifunctional smart poles. Use 5G base station construction requirements to prepare the city’s multifunctional smart pole construction plan and standard. Coordinate the planning and construction of multifunctional smart poles and oversee the operation and maintenance of these and of auxiliary resources in the city.



• Strengthen the availability of power for 5G sites. Make direct power supply accessible to 5G base stations under special transformer conditions, and regulate power pricing.

Shenzhen’s efforts are also supported by the Guangdong Province’s “Action Plan for Accelerating 5G Industry Development (2019–22).” This policy includes the following measures:

• Set targets for 5G development across the province including 60,000 base stations, 4 million users, and 5G output value exceeding CNY300bn by the end of 2020. At the end of 2022, the Pearl River Delta will build a 5G broadband city cluster and provide contiguous 5G network coverage in major urban areas with 170,000 5G base stations and 40 million 5G users. The output value will exceed CNY1tn.

• Accelerate 5G network construction, including preparing 5G base station construction plans, vigorously promoting 5G smart pole and tower construction, and steadily promoting 5G network construction.

• Promote assurance measures, including power availability, frequency management, increasing financial support, and enhancing cybersecurity.

In 2020, the provincial government also introduced “Policies and Measures for Accelerating 5G Network Construction.” This directive

• Promoted the joint implementation of construction planning, including incorporation of 5G base station planning into local land plans, promoting synchronous design, construction, and acceptance of new buildings and base stations, and simplifying the base station approval and construction application process

• Made public resources available free, including specifying the scope of free resources and the process of public resource opening

• Unified standards related to base station expense, including specifying the charging standards for main transportation lines and hub stations and making provincial metros, high-speed railways, urban rails, airports, and large-scale stations open to basic telecoms enterprises and Guangdong Tower

• Enhanced power supply assurance for base stations, including optimizing the cable installation process for base stations and accelerating the conversion to direct power supply

• Strengthened the co-construction and sharing of communications facilities, including the construction of base stations and indoor distributed systems and the construction of smart lamp poles

• Strengthened the base station construction mechanism, including establishing a government-enterprise coordination mechanism and strengthening market supervision and inspection



Case study: Beijing

In September 2020 the MIIT announced that Beijing had become the second Chinese city to achieve full 5G coverage. At that point more than 44,000 base stations had been rolled out, with the total expected to reach 50,000 by year-end. Beijing Municipality’s “Action Plan for Accelerating New Infrastructure Construction (2020–22)” included targets for continuous outdoor coverage inside the Fifth Ring Road planned via 30,000 base stations by end-2020, with indoor coverage available in 5,000 buildings. This target was exceeded by mid-2020.

Beijing’s current “5G Industry Development Action Plan” covers the period 2019–22. The action plan includes and calls for

• Revisions to the “Code for Design of Civil Building Communications and Cable Television Infrastructure” based on 5G base station design standards

• Municipal departments to ensure that communication facilities in civil building developments are designed, constructed, and accepted at the same time as the main building project

• Government departments at all levels to make available resources, such as office buildings and other public buildings, as sites for 5G base station construction

• Municipal planning departments to formulate comprehensive pole design standards and management practices that integrate functions such as municipal lighting, road surveillance, traffic signals, communications base stations, and environmental protection monitoring, so as to realize “multi-pole integration,” strengthen resource sharing, and reduce construction rework

Other local directives included facilitating power supplies for 5G sites, requiring State Grid Beijing to do the following:

• Create convenient conditions for the rapid construction of auxiliary power facilities for 5G base stations.

• Provide direct power supply services for 5G base stations and explore a metered charging solution in the form of integrated energy services.

• Ensure cooperation with the telecoms operators and tower companies to optimize the 5G base station layout and the current public power grid.



Case study: Shanghai

Shanghai has pursued a “dual gigabit” strategy, targeting availability of superfast wireless and fixed broadband throughout the city. Shanghai was recently awarded the 2020 World Smart City Award, in part thanks to its deployment of 5G and its integration with its digital infrastructure and e-government services.

The 5G operators have built 25,000 outdoor and 31,000 indoor base stations, making Shanghai the city in China with the most 5G base stations, according to local authorities. The government’s three-year 5G plan involves a total investment of CNY30bn ($4.6bn).

Shanghai’s planning for 5G began with the development of “Suggestions on Accelerating the Construction and Application of 5G Networks in the City.” This report called for government and the industry to do the following:

• Prepare layout plans based on the urban and rural planning system, with special planning for site layout in key areas, effectively linking 5G construction with other related planning, and ensure integrated construction and resource sharing of 5G infrastructure.

• Formulate a construction plan. Prepare an annual 5G base station construction plan, specify the owners for coordination and promotion by region and department based on the responsibilities of municipal and district government departments, and regularly evaluate progress.

• Improve the power and communications duct access, establishing a sound coordination mechanism, and develop streamlined approvals for 5G power and communications.

• Promote opening and sharing of public facilities such as streetlamp poles, ducts, and gantries to build 5G mini base stations and the deployment of multi-use poles. Government buildings and public places such as airports, subways, and transportation hubs are to be fully opened up.

Also in 2019, “Excellent Power Services to Support 5G Network Construction” directed the municipal power company to ensure streamlined access to power supplies for 5G sites, improve coordinated planning, allow direct supply of power, and encourage use of substation resources as 5G sites.

In June 2020, 5G deployment planning was aligned with Shanghai’s 2017–35 city planning vision with the publication of the Shanghai 5G Mobile Base Station Layout Planning Guide. The plan proposed an overall construction layout and site requirements of 5G base stations in Shanghai based on the industrial layout and city development trends. The guide promoted the implementation of a “1+16+X” 5G base station layout planning system: 1 city-level layout plan, 16 district-level 5G base station layout plans, and X regional plans. The guide provides a roadmap for the deployment of 5G to support the future social and economic development of the city.



Conclusion

China’s accelerated 5G progress has been built on a national plan to promote its success. Fundamental to this has been a concerted effort across all levels of government and industry to streamline the rollout of 5G networks and encourage coordination, standardization, and sharing of infrastructure.

China’s success to date has relied on maximizing the utilization of existing macro sites. Importantly, by ensuring access to municipal infrastructure and standardization of solutions, China is also well prepared for the next phase of deployment involving additional smaller cells and indoor coverage.



Appendix

Methodology

Insights contained in this report are based on data and industry intelligence collected from various sources including Omdia

proprietary research, media coverage, and service provider and government sources.

Author

Stephen Myers

Principal Analyst, Service Provider and Regulation

[email protected]



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china’s regulatory blueprint for 5g success

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