July operating data of the three major operators: 5G becomes the "driving force" of growth, with the number of users exceeding 500 million

Recently, the three major operators have released their operating data for July. Unsurprisingly, in July, the main business of the three major operators continued the growth trend of the previous months. Although there was no significant increase in quantity, it was still a steady progress. Such results are not easy for the telecommunications industry, which has long been saturated.

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The good performance of the three major operators in their main businesses this year is also reflected in their financial statements. According to data released by the operators, in the first half of this year, the revenue and profit of the three major operators all increased. Of course, the driving force of 5G cannot be underestimated. China Telecom admitted that the growth of 5G revenue has become an important driving force for overall revenue in the first half of the year. In the first half of the year, China Unicom's 5G ARPU reached nearly 61 yuan.

Steady progress: 5G package users are still the main growth force

According to public data, in July, the number of operators' users in each main business did not fluctuate much compared with other months in the first half of this year. China Telecom still topped the list of net increase in mobile users; China Mobile's net increase in broadband users and net increase in 5G package users continued to lead. It is worth mentioning that China Unicom once again surpassed China Telecom in terms of monthly 5G package user growth.

Specifically, in July, China Mobile's mobile customer base increased by 1.959 million, with a total of 947.465 million users. In the same month, China Mobile's 5G package customer base increased by 28.913 million, reaching a total of 279.608 million. China Mobile's 4G customer base increased by 6.602 million, reaching a total of 805.45 million. In the same month, China Mobile's wired broadband customer base increased by 2.655 million, reaching a total of 228.254 million.

According to the operating data released by China Telecom, in July, China Telecom's mobile user base increased by 2.13 million, with a total of 364.62 million mobile users. In the same month, the number of 5G package users increased by 7.06 million, with a total of 138.21 million 5G package users. In terms of wired broadband business, China Telecom's wired broadband user base increased by 880,000 in the same month, with a total of 165.09 million wired broadband users.

In terms of mobile business, China Unicom's mobile bill users increased by 1.155 million in July, reaching a total of 311.611 million. Among them, the net increase of 5G package users in July was 7.742 million, reaching a total of 121.072 million. In terms of fixed-line business, China Unicom's fixed-line broadband users increased by 477,000 in July, reaching a total of 90.600 million.

5G has obvious benefits, and operators are accelerating their deployment

Looking at the operators' TO C business, it is not difficult to find that today's 5G users are the development focus of each operator. For China Unicom, which is relatively weak, it may also be the capital for a comeback.

The early preparations for network construction and large-scale marketing promotions have enabled operators to harvest the first batch of 5G users. As tariffs become more affordable and consumers' recognition of 5G increases, the growth of 5G users can already bring real benefits to operators.

According to the first half financial reports released by major operators, China Mobile's ARPU value was 52.2 yuan, China Telecom and China Unicom were 45.7 yuan and 44.4 yuan respectively. China Unicom's year-on-year increase was relatively higher. China Unicom specifically emphasized that it was the credit of 5G. In the first half of the year, China Unicom's 5G ARPU was about 61 yuan, which had a significant effect on the overall ARPU. China Unicom also stated that it will add about 40 million 5G users in the second half of the year.

The premise of developing 5G users is 5G network coverage. In the first half of 2021, China Mobile's 5G-related investment reached RMB 50.2 billion. As of the end of June, a total of 501,000 5G base stations had been opened, providing 5G services to urban areas above prefecture-level cities, some county towns and key areas across the country. In addition, China Mobile has orderly promoted the co-construction and sharing of the 700MHz network with China Radio and Television Network Group Co., Ltd., and has completed the centralized procurement of wireless network main equipment and antennas on behalf of both parties.

"After the bidding for the centralized procurement of wireless network main equipment and antennas, the next step will be the construction of the entire 700M. Generally speaking, a total of 480,000 700M base stations will be purchased this year and next year, and the construction will be carried out in two years." said Yang Jie, chairman of China Mobile.

It is an indisputable fact that the investment and operating cost pressure of 5G network construction is high. Therefore, China Telecom and China Unicom also have their own ideas about 700MHz, which is suitable for coverage in rural and remote areas.

At China Unicom's 2020 performance briefing, China Unicom Chairman Wang Xiaochu said that the joint construction and sharing of the 700MHz frequency is an opportunity for the four telecom operators. "If the four companies jointly build or use this frequency in remote areas such as rural areas, as well as roads and railways, it will be extremely beneficial to the four companies. Because the four companies share this part of the cost equally, it will make the efficiency in remote areas such as rural areas higher, which is beneficial to any company!"

China Telecom Chairman Ke Ruiwen said that China Telecom is currently actively promoting the joint construction and sharing of 700M in rural areas.

China Telecom and China Unicom are understandably eyeing 700MHz, after all, 5G network construction is a major project. Take China Telecom as an example. Due to the tight supply of chips, which has had a certain impact on the supply of some equipment, it plans to build 180,000 5G base stations throughout the year, but only built 50,000 5G base stations in the first half of the year, and the progress of 5G construction is slightly behind schedule. This may also be one of the reasons why China Telecom lacks stamina in developing 5G users.

Whether it is the vast rural and remote areas or the densely populated cities, operators will not miss any place where 5G users may be developed. The newly released "5G Application "Sailing" Action Plan (2021-2023)" clearly states that by 2023, the penetration rate of 5G individual users will exceed 40%, and the number of users will exceed 560 million. In other words, the average annual increase in 5G network customers will be more than 140 million in the next three years; it is required that by 2023, there will be 18 5G base stations per 10,000 people. According to the current 960,000 5G base stations, 1.56 million 5G base stations will be added in the next two and a half years. This is a major test for operators.