China Mobile's elimination of fake 5G users may be the reason for the slowdown in 5G user growth

Due to pressure from all sides, the three major operators all worked hard to build 5G networks and develop 5G users in 2020. However, the 5G users they announced are all 5G package users, who are not actually real 5G users.

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Real 5G users should refer to users who use 5G mobile phones and 5G packages and access 5G networks. However, in 2020, the number of 5G package users of the three major operators reached more than 300 million, while the cumulative number of 5G mobile phones sold in the Chinese market in 2019 and 2020 was only 170 million. This means that at least 130 million 5G package users in the Chinese market are fake 5G users.

This practice of excessively pursuing the number of 5G package users has put tremendous pressure on operators. In order to attract users to switch to 5G packages, the traffic of 5G packages at the same price often far exceeds that of 4G. As a result, the traffic of 5G package users has increased significantly, but many of these 5G package users are still using 4G mobile phones and 4G networks, causing the operators' 4G networks to be under tremendous pressure.

China Mobile's 4G network is the one under the most pressure among the three major operators, because China Mobile's 4G users are far more than the sum of China Unicom and China Telecom's 4G users. However, China Mobile's fiber optic transmission network is the weakest. The huge data traffic has already caused China Mobile's 4G network and fiber optic transmission network to be under heavy pressure. These 5G package users continue to use the 4G network, which will naturally further force China Mobile's 4G network into a tighter state.

​It is precisely taking into account the above factors that China Mobile specifically pointed out 5G package users and 5G network users when it recently released the number of 5G users. The data it released as of February showed that there were 173 million 5G package users, while there were only 77.67 million 5G network users, a difference of nearly 100 million.

As China Mobile's definition of 5G users changes, perhaps it will adjust its 5G user numbers in the future, excluding those false 5G user numbers and pursuing the real 5G user numbers.

China Mobile is also doing this because its 5G network will be further improved this year. According to data from 2020, China Mobile's 5G network has 390,000 5G base stations, and the 5G network jointly built and shared by China Unicom and China Telecom has 380,000 5G base stations. Currently, 5G networks have covered most cities above the prefecture level. China Mobile may accelerate the construction of 5G networks this year to ensure that its 5G network coverage is ahead of its competitors.

With a more complete 5G network, China Mobile can attract more users to use the 5G network with its high-quality 5G network, reduce the pressure on its 4G network, and rely on the faster 5G network to obtain higher value and increase the average ARPU value per capita. After all, the actual average ARPU of 5G users is higher than that of 4G users. ​

China Mobile has proactively adjusted the identification criteria for 5G users, no longer pursuing quality in favor of quantity, and competing with rivals with high-quality services, which will bring more real value and benefit the long-term development of the company. Faced with China Mobile's changes, China Unicom and China Telecom may also follow suit. After all, as the big brother, China Mobile is not ashamed that its actual 5G users are far lower than 5G package users, so it is meaningless for China Unicom and China Telecom to compete for the leading advantage in 5G package users.