- China is considering merging China Telecom and China Unicom, two of its biggest mobile-phone carriers, according to Bloomberg.
- A merger would leave the country’s telecommunication industry with two mega carriers, CT/Unicom unit and China Mobile, allowing both to aggressively pursue 5G technology.
- This allocation is prompted by an escalating competition in 5G technology amid an escalating trade war between the US and China.
An escalating trade war is prompting China to consider merging two of its biggest mobile-phone carriers to dominate competition over US in 5G, the next-generation of high-speed wireless technology, according to Jefferies analysts.
This government allocation is “not a surprise” in the eyes of Jefferies analyst Edison Lee.
Lee estimates that a combination will leave the country’s telecommunication industry two mega carriers, CT/Unicom and China Mobile, and allocate them different spectrum to allow both to aggressively develop 5G technology.
“Under a merged CT/Unicom (T/U) scenario, T/U and CM will both be allocated the following: 1) 100MHz of contiguous spectrum at 3.5GHz, 2) 100MHz of contiguous spectrum at 4.9GHz, and 3) 50MHz of contiguous spectrum at 3.3GHz for indoor coverage,” Lee said.
“In addition, the government may allocate 60MHz of contiguous spectrum at 2.6GHz to T/U (below CM’s current allocation), and 40MHz (above CM’s current allocation) to CM so that CM can combine it with its existing 4G spectrum of 60MHz. That means CM will have 100MHz spectrum at 2.6GHz to deploy, more than T/U’s 60MHz.”
Fifth-generation, or 5G, connectivity has been one of the core competitions between the two countries. The US is pursuing a comprehensive wireless strategy to ensure that the nation will lead the world in the deployment of next-generation wireless technologies, according to Federal Communications Commission, who said 5G technology could be up to 100 times faster than current 4G service.
Under the initiative “Leading the World Toward a 5G Future,” the FCC makes additional forward-thinking spectrum available for 5G services, builds infrastructure to support the data intensive uses, and relaxes regulatory barriers to encourage 5G networks investment.
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