Terminals have become a major obstacle to the development of 5G

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On March 26, China Unicom finally announced its 5G package user data as of the end of December 2020 in March 2021. The overall scale is consistent with everyone's prediction. It is worth praising that China Unicom's 5G package user penetration rate is almost the same as that of China Telecom and ranks second in the industry. Its 5G package user market share also exceeds its mobile phone user share. Although China Unicom has brought such good news to everyone, we still need to seriously analyze and promote the solution of problems in the development of 5G, among which terminals have become a major obstacle to development.

1. The number of 5G terminals is far lower than the scale of package users

After various preferential marketing promotions, by the end of 2020, the total number of 5G package users of China Mobile, China Unicom and China Telecom has exceeded 310 million, ranking first in the world in terms of total volume. According to data released by the China Academy of Information and Communications Technology, by the end of 2020, there were about 170 million 5G terminals in my country.

The gap between the 310 million or so 5G package users and the 170 million 5G terminals is the 4G terminals. Although these nearly 140 million users have subscribed to 5G packages, they still use the 4G network, after all, their mobile terminals do not support the 5G network.

If the penetration rate of 5G packages in my country has exceeded 20%, then the penetration rate of 5G terminal users in my country is less than 11%. The huge gap between the two truly reflects the current status of 5G user development in my country. On the one hand, there are discounts and promotions from operators, and on the other hand, the majority of users continue to wait and see.

The three major operators are all faced with the problem of promoting the conversion of 5G package users into real 5G users. Specifically, China Mobile has about 110 million online 5G terminals, and its 5G user penetration rate is about 11.6%. Based on this, it is estimated that the combined 5G user penetration rate of China Unicom and China Telecom is about 9.2%.

2. Low cost-performance ratio of 5G terminals is the main problem

Although 5G information has attracted a lot of attention and hype, the majority of consumers have not shown a particular enthusiasm for 5G, especially when it comes to whether to buy 5G mobile phones. We visited some of HMOV's flagship stores and read from the wait-and-see eyes of some consumers that 5G mobile phones are useless.

Although various mobile phone manufacturers have launched 5G mobile phones priced under 2,000 yuan, the ones that really attract consumers are basically priced at 3,000 yuan or even more than 5,000 yuan. Interested readers can go to JD.com to check out the various 5G mobile phone models. All 5G mobile phones that can impress you are priced at more than 3,000 yuan.

If there is any difference between 5G phones and 4G phones, we think 5G phones can have faster Internet speeds, but other than that, you can't find a reason to pay for it. In the current situation where 5G network coverage is limited, even 5G phones can only stay on 4G networks.

Although industry promoters including the three major operators and a large number of mobile phone manufacturers are spending huge sums of money to promote innovation in 5G-specific applications, the effect of the joint efforts is very limited. Here is an example: at the beginning of 2020, 5G messaging led by the three major operators had not actually become a popular application.

In addition to the low cost-performance ratio, there is something even more surprising. Most of the high-end 5G mobile phones from the well-known and popular manufacturer are out of stock or incomplete. The reason given by the store staff is that they are too popular and the hardware is limited, so the supply cannot meet the demand.

Some mobile phone terminal manufacturers may strongly disagree with the above view, and will list various reasons such as unclear 5G application scenarios, lack of 5G chips, and even incomplete 5G network coverage. Although these problems are indeed problems, the network is not a big problem when 5G networks have achieved full coverage of prefecture-level cities.

3. It is not advisable to develop and promote 5G terminals with the mentality of harvesting users

Although industry leaders including the three major operators and a large number of mobile phone manufacturers have pushed for the further maturity of 5G mobile phone terminal technology and the market, the effect of the joint efforts is very limited. On the one hand, operators have cut terminal subsidy costs, and on the other hand, mobile phone manufacturers have reduced marketing expenses.

As for operators reducing terminal subsidy costs, this is due to both strong regulatory control and the high cost of 5G network construction, which has led to insufficient terminal subsidies. As for mobile terminal manufacturers reducing marketing expenses, they gave the explanation that there is limited room for price cuts, including due to high R&D costs.

Although everyone knows that 5G technology is mainly aimed at the government and enterprise markets and its core is not in the individual user market, before 5G fully matures, its inevitable development path will be to start with the easy and then move on to the difficult. This requires all parties, including mobile terminal manufacturers, to have the spirit of cultivating the market rather than just thinking about harvesting users.

5G is the current and future technology leader, but some mobile phone manufacturers have not focused on or taken it as their responsibility to cultivate the 5G consumer market. Instead, they are pushing consumers to eat the leftovers of 4G. The lack of progress or the waiting and waiting approach of most 5G mobile phone manufacturers is not worthy of praise.

Regardless of the attitude of 5G mobile phone manufacturers, China Mobile recently released the 2021 edition of the terminal product white paper. China Mobile has clearly put forward the technical and time-to-market requirements for 5G terminals, including canceling the SA setting switch, supporting VoNR, and supporting network slicing functions, demonstrating its aggressive attitude.

As 5G user development has made great progress, we need to be aware of the main problems facing 5G development. All stakeholders, including regulators, operators and mobile terminal manufacturers, should do their utmost to promote my country's 5G global leadership.