What are the highlights of the communications industry in 2022?

This article is reprinted from the WeChat public account "Xianzao Classroom", the author is Xiaozaojun. Please contact the WeChat public account of Xianzao Classroom to reprint this article.

Highlight 1: 5G private network

2021 is the first year of the development of 5G toB. This year, with huge financial support from the government and the accumulation of resources from operators and manufacturers, various industries have supported a large number of 5G benchmark applications, such as 5G factories, 5G docks, and 5G mines.

The question in 2022 is how to replicate these benchmark projects at low cost.

In other words, if the country stops spending money, can 5G survive on its own? Can operators and manufacturers still make the transition from “focusing on supporting a single project” to “generally supporting N projects”?

The further advancement of 5G toB has aroused people's attention to 5G private networks. The construction of 5G public networks has achieved its initial goals. Will private networks become a new growth point?

In fact, our country has strict policies on private networks and tight control over spectrum resources. For enterprises, there is basically no room for building their own networks. Moreover, the technical threshold for private networks is too high, and the construction and maintenance costs are also high. Therefore, except for state-owned enterprises such as electricity, oil, and railways, most enterprises do not have strong motivation and willingness to build private networks.

From a technical perspective, 5G's advantages are mainly in latency and bandwidth, and there are not many scenarios where it is really needed. If companies are to build a 5G private network at their own expense, most will carefully weigh the pros and cons.

I personally think that if you want to develop a private network, financial support alone is not enough. We should consider loosening up policies, technologies, and spectrum to give enterprises more choices. We are not building a private network for 5G, but for digital transformation. Instead of overemphasizing the role of 5G in private networks, we should pay more attention to the importance of campus all-optical networks and cloud-network integrated access, and drive user demand for the network through cloud services to stimulate the construction of private networks.

Point 2: Policy trends for millimeter waves

The Beijing Winter Olympics will open in one month. As a communications person, the most noteworthy thing in this Winter Olympics should be the appearance and application of millimeter waves.

Millimeter wave technology is very controversial, and many people have raised it to the political level. In fact, this is unnecessary. From the perspective of the industrial chain, China is also an important participant and beneficiary of the millimeter wave industry chain. There is no need to exclude a technology.

As a mobile communication technology, millimeter wave is not as bad as people imagine. Speed ​​and coverage are the two ends of the scale, and each has its own advantages in different scenarios. The technical advantages of millimeter wave are large capacity, large bandwidth, low latency and precise positioning.

The 8K and VR/AR live broadcasts of the Winter Olympics are an opportunity for millimeter waves to showcase themselves. If millimeter waves perform well at the Winter Olympics, it is possible that they will accelerate the progress of millimeter wave testing in China and further affect millimeter wave development policies, including the division of commercial spectrum.

Highlight 3: Commercial use of R16

The 3GPP R16 standard was frozen in 2020, but the actual technology will be implemented in 2022. R16 chips and terminals will be put on the market in batches in 2022. Therefore, this year we need to pay attention to what impact R16 will have on the existing 5G network. Will the performance indicators of R16 bring a significant experience upgrade?

At the same time, we look forward and pay attention to the freezing of R17 and the start of R18. 5G-Advanced is here in the blink of an eye. We need to study what new features it has. RedCap is also a technology worth paying attention to. As a youth version of 5G, will it have an impact on IoT technologies such as NB-IoT?

At present, the development of communication technology is led by 3GPP. The direction of 3GPP Rxx is the direction of the development of communication technology. If you follow Rxx closely, you will not go wrong. However, 3GPP's dominance has stifled the innovation of communication technology and formed a patent monopoly of technology by giants. It is becoming increasingly difficult for emerging companies to "rebel", and the probability of the emergence of new communication technologies is getting lower and lower. This is a question worth thinking about.

Point 4: Price trends of chips and modules

There is a chip shortage everywhere in 2021, and this situation is likely to continue in 2022.

In this context, the price of communication terminal chips has not dropped as much as expected. In particular, the price of 5G chips is still very expensive.

On the one hand, digital transformation is accelerating and IoT applications are exploding, but on the other hand, the prices of chips and modules cannot be reduced, which is a problem.

Among several chip manufacturers, Huawei, due to sanctions, has now made a second choice and pursued a stable supply of chips with a lower process (28nm). Although this process is not enough for 5G mobile phone terminals, it can at least meet the needs of base stations, data communications, and optical communication main equipment.

Another domestic manufacturer, Unisoc, has gradually started to export product results after years of accumulation. Unlike Huawei, Unisoc does not have its own terminals. From a long-term perspective, the domestic industry chain should increase its support to allow more terminal companies to use Unisoc. Only when someone uses it will it become better and protect this unique seedling. Unisoc itself should also be careful not to be targeted, as time is still very tight.

In 2022, the shipment volume of domestic chip modules will only increase, and Cat.1 and NB-IoT have great growth potential. 2G and 3G will be decommissioned at an accelerated pace, and the IoT market share will undergo a major reshuffle. Costs determine the market structure after the reshuffle.

High-speed optical modules also face cost issues.

In terms of transmission backbone network, the unavoidable topic is 400G. 400G, in the end, is all about cost and price.

The capacity expansion of backbone networks has not stopped, and the number of data centers stimulated by cloud computing is also growing faster and faster. All of these have a strong demand for high-speed optical modules. In 2026, the global optical module market size is expected to reach US$14.5 billion.

In contrast, the price of high-speed optical modules, like the price of 5G chips, has been falling slowly. The situation in which the price of 1G and 10G optical modules fell rapidly in the past is no longer the case.

The overall situation of the global economy determines the rise in resource prices and the price of final products. The price increase means that the CAPEX of operators remains high. Ultimately, the cost will be passed on to users.

After this round of market conditions, who will benefit and who will suffer? Only time will tell us the answer.

Highlight 5: Gigabit optical access and F5G

The development of domestic optical access infrastructure is extremely rapid. In more than ten years, we have gone from 1M to 8M, 10M, 20M, 50M, 100M, 200M, and 500M. Today, many families have entered the Gigabit (1000M) era.

As gigabit speeds are rapidly becoming popular, operators are already working to advance the 50G-PON standard.

The user access speed brought by 50G-PON is 5Gbps. In fact, from the perspective of user demand, just like 5G, people don’t know what such a high speed can bring us except the increase in tariffs.

Only VR/AR and future holographic videos can use such high speeds. Judging from the current domestic public's aversion to the metaverse, the immersive digital world experience still has a long way to go. The standard bandwidth of home Internet speed is estimated to be 200Mbps as a threshold. If it is higher, the user experience will not be much different.

In addition to home broadband access, the demand for corporate commercial office fiber optic access should be given full attention by operators.

The cost of commercial optical access is too high, the upstream rate is too low, and there is no external network IP, all of which are pain points.

In the context of enterprises moving to the cloud, users' demand for solutions to these pain points has gradually surpassed their demand for simple download speeds. Can operators give up some of their profits to bring more convenience and experience upgrades to users?

Highlight 6: Internet of Vehicles

In 2021, influenced by the development of new energy vehicles as a whole, people paid great attention to cars.

The Internet of Vehicles, autonomous driving, and driverless driving have also received much attention from the public and investors. Huawei and Xiaomi have successively entered this field, further stimulating the escalation of attention.

In fact, from a technical point of view, the progress made in the Internet of Vehicles, especially vehicle-road collaboration, is not particularly significant.

The investment required for the Internet of Vehicles is huge, and it is unlikely to be widely implemented without fully mature technology. In most places, small-scale trials are still the main focus.

Now the industry is aware of this problem, so it has begun to propose vehicle networking in a "closed or semi-closed" environment.

To put it simply, it is the unmanned driving and vehicle-road collaboration within the park. It may take some time for the vehicle networking at the city scale and on public highways.

I think this idea is right. It is safer from a safety perspective to conduct experiments in closed or semi-closed areas before promoting them on a large scale. I personally think that if more fully closed driverless highways can be built, it will be more helpful for the verification and maturity of the technology.

Point 7: Spectrum Policy

In 2022, the long-delayed 5G service of China Radio and Television will be officially launched. With the capabilities of China Radio and Television, even if the service is launched, it will not affect the existing market share. It is worth noting whether China Mobile will further strengthen its competitive advantage over China Telecom and China Unicom with the help of 700M.

The biggest beneficiary of the 700M radio, television and mobile cooperation is China Mobile.

China Telecom and China Unicom have never stopped their demands for further spectrum sharing. The two operators have long coveted 700M and have been seeking policy support.

From a macro perspective, spectrum resource sharing is beneficial to China Telecom and China Unicom. China Mobile is stronger than China Unicom and China Telecom combined, and has the largest number of base stations. Further sharing will stimulate market competition and put pressure on the operator with the largest market share.

In addition to 700M, the allocation of high-frequency bands (especially millimeter wave bands) will be the focus of competition among operators. The spectrum sharing policy is most likely to affect the domestic market structure.

Highlight 8: Small base stations

The construction of 5G macro stations has reached a threshold. Starting in 2022, 5G will focus on the construction of indoor base stations.

This means that the market opportunities for small base stations are gradually emerging.

Speaking of small base stations, how big a market is there for Open RAN, which everyone has been paying attention to? At present, the development of Open RAN base stations around the world is neither good nor bad. There are still not many operators using it. Mainstream operators are basically waiting and watching.

As the world's largest mobile communications market, China's attitude towards Open RAN directly determines the fate of Open RAN. I personally think that the conditions for large-scale use of Open RAN in the public mobile communications market are still not mature, especially for Chinese operators, as it is too difficult to define aspects such as operation and maintenance responsibilities, and energy consumption is not very reassuring. It is estimated that it will be tested on a small scale or in a private network before deciding whether to use it in large quantities in the next step.

It is reported that the centralized procurement of small base stations will be held in the first half of the year. I don’t know who will benefit from this big pie.

Point 9: Safety

In 2021, the global communications network is not peaceful.

In June, the entire United States experienced network failures; in October, FACEBOOK suffered the worst network outage in history; in November, a certain operator in Gansu suffered a large-scale network failure; recently, Xi'an Yimatong has experienced frequent downtimes... These are constantly reminding us that while the network is secure and stable, we still face great threats and have a lot of work to do.

Technology is advancing rapidly, but the Internet is not as indestructible as everyone thinks.

In 2022, we will welcome the Olympic Games, the 20th National Congress of the Communist Party of China and other important events, and the security and stability of the network are extremely important. Communication networks have always emphasized "native security", but it seems a bit far away.

I hope that there will be fewer or no network incidents this year, that everyone will be safe, and that fewer communications people will be blamed.

Highlight 10: New Technology

The situation where there is no breakthrough in the basic theory of communication technology will not change in 2022.

Before 6G arrives, the wireless air interface will not change much. Both metasurface technology and terahertz technology will take several years to mature.

As for new technologies, it is worth paying special attention to low-orbit, large-bandwidth satellite communications, and the integration of AI and traditional communications.

Low-orbit, high-bandwidth satellite communications have been very popular in recent years, led by Musk's Starlink. We cannot use Starlink, so we will definitely develop our own low-orbit satellite communications system.

At present, national teams such as China Satellite Communications Corporation have made rapid progress in this regard, and their coverage has gradually expanded from civil aviation routes to the Belt and Road Initiative and major maritime routes.

The development of domestic private satellite enterprises is facing great obstacles. Satellites require too much technology and capital, and ordinary enterprises cannot afford them, and they are also prone to failure.

Satellites are an effective supplement to ground communication systems. They may not be noticeable at ordinary times, but once something happens, their importance becomes apparent. Developing satellite communications, forming an effective combination with ground-based 5G, and ultimately promoting space-air integration is something worth doing.

Let’s talk about AI.

The integration of AI and traditional communications focuses on performance potential, intelligent operation and maintenance, and energy consumption reduction.

Performance potential is actually to use AI to empower wireless algorithms, such as high-order modulation or Massive MIMO beam tracking. This is still quite difficult.

Intelligent operation and maintenance. The current communication network is too complex, and the traditional manual maintenance method is unsustainable. The appropriate introduction of AI in specific scenarios will effectively reduce the workload and difficulty of network operation and maintenance.

We are still a long way from a fully intelligent autonomous network, but we have seen a lot of hope in the intelligentization of scenarios.

Energy efficiency can directly bring economic benefits and is in line with national strategies. I believe it will be the most important area for the implementation of AI.

The last thing worth mentioning is the computing power network.

This year, operators are paying more and more attention to computing power networks. In fact, computing power networks are an extension of cloud-network integration. The boundary between cloud and network is becoming increasingly blurred, and computing power and connectivity are ultimately integrated.

As practitioners in the traditional communications field, we must have our own understanding of this trend.

Always revolving around traditional networks will eventually lead to a dead end. While connectivity still has some say, we should take the opportunity to penetrate the computing power field, look for new business opportunities in areas including edge computing, and transform ourselves into computing power algorithm engineers, while enterprises transform into computing power enterprises.

The top management of operators have a clear view of the situation and are trying to get rid of the positioning of pipelines and actively seek to become digital infrastructure providers, solution providers, and content providers. The IDC and industry digital solutions that operators are vigorously building are to become partners of enterprise digitalization in the toB field and avoid being sidelined by equipment vendors.

Well, the above is Xiaozaojun's review of the top 10 highlights of the communications industry in 2022. Personal opinions and views may not be accurate, and everyone is welcome to criticize!

To be honest, the biggest focus in 2022 is still the epidemic. I hope the epidemic will end as soon as possible and the whole world will return to normal. Two years of our lives have been stolen, and we really don’t want another year to be stolen.

Right?