China Unicom and China Telecom said on Monday they will work together to build one nationwide 5G network as the country’s second- and third-largest telecom operators join hands to reduce construction costs for fifth-generation wireless technology.
The two companies claimed they will jointly build and share network infrastructure to offer the same level of service.
All three major Chinese telecom operators — China Mobile, China Unicom and China Telecom — co-own China Tower Corp, which makes it easier for China Unicom and China Telecom to cooperate on building 5G base stations.
Besides offering a way to reduce the high cost of building 5G networks, the new agreement will also help ease operator pressures, especially as the domestic telecom services market is contracting.
Xiang Ligang, director-general of the Information Consumption Alliance, a telecom industry association, explained that given the government’s push to boost speed and reduce mobile data tariffs, operators are under certain pressures and it is difficult to see steady growth in revenue.
“5G construction will not only bring operators opportunities and new streams of revenue, but also boost development of the whole industry and economic growth,” Xiang said during a recent interview with China Daily.
Based on their total number of 4G base stations, China Unicom and China Telecom will work together to build 5G networks in 15 cities, including Beijing, Tianjin, Shanghai and Nanjing in Jiangsu province.
China Unicom will independently build 5G networks in 9 cities in Guangdong province, five cities in Zhejiang province and eight northern regions, including Hebei, Henan, Heilongjiang, Jilin, Liaoning, Shandong, Shanxi and the Inner Mongolia autonomous region. China Telecom, meanwhile, will build 5G networks in 10 cities of Guangdong province, five cities in Zhejiang province and 17 southern provinces.