In the past six years, the total financing of my country's 5G industry has reached 127.874 billion yuan, with China Unicom leading the way

5G commercial use is about to enter the fast lane. According to data released by China Mobile, China Telecom and China Unicom in June 2020, the number of 5G package users in China has exceeded 100 million. Operators have achieved large-scale 5G network coverage in first- and second-tier cities in China, and most prefecture-level cities and even county-level cities have 5G base stations. According to data from the China Academy of Information and Communications Technology, the cumulative shipments of 5G mobile phones in the domestic market in 2020 reached 163 million units, accounting for 52.9%.

On February 20, Qichacha Big Data Research Institute released the "Research Report on the Development of my country's 5G Industry", which comprehensively analyzed the development status of my country's 5G industry from the aspects of 5G base station construction, inventory of related companies, industry financing data, and future industry layout.

The total disclosed financing in the past six years reached 127.874 billion yuan, with 2017 being the peak.

At present, domestic operators, equipment manufacturers, and terminal manufacturers are all accumulating strength in 5G construction. Due to frequency band factors, the signal coverage of 5G base stations is far less than that of 4G. 5G network construction requires laying more base stations, and the cost will be greatly increased compared with 4G. According to the procurement and bidding data disclosed by operators in 2020, the construction cost of a single 5G base station is about 160,000 yuan. After commercial scale, the unit cost will gradually decrease.

Referring to the 44% compound growth rate of 4G base stations in my country from 2014 to 2019, the Qichacha Big Data Research Institute conservatively estimates that the total investment in China's 5G base station construction will reach a trillion yuan in the next five years. According to statistics from the China Academy of Information and Communications Technology, it is expected that the commercial use of 5G in my country will directly drive a total economic output of 10.6 trillion yuan and directly create an economic added value of 3.3 trillion yuan from 2020 to 2025.

According to Qichacha data, from 2015 to 2020, there were 356 financing events in China's 5G industry, with a total financing amount of 127.874 billion yuan. The number of financing events has generally shown an upward trend, and the financing scale in 2017 was significantly larger than in other years, because China Unicom's mixed ownership reform in 2017 raised a total of 78 billion yuan. Excluding this special factor, 2020 is the best year for financing of 5G industry-related companies in recent years.

From the perspective of corporate financing, Qichacha data shows that early-stage projects (seed to A+ rounds) that have received financing in the 5G industry account for half of the total financing events in the past six years. The number of projects that received strategic investment only accounted for 16.27% of the total, but their financing scale accounted for 76% of the overall financing scale. Companies with a higher level of 5G industry development maturity have absorbed three-quarters of the capital market's funds.

From 2015 to 2020, the ranking of financing events in the 5G industry by financing scale is shown in the table above. According to Qichacha data, in 2017, China Unicom's mixed-ownership reform raised a total of 78 billion yuan, the highest in the past six years. Wingtech Technology, Unisoc, Meizu Technology, TransInfo, Analogix, and ZTE Microelectronics are all on the list. The investors are mainly national teams, such as the China State-owned Enterprise Structural Adjustment Fund, the National Integrated Circuit Industry Investment Fund, and Shanghai Guosheng, among which there are also Internet companies such as BAT and JD.com.

Main equipment and upstream component manufacturers will benefit first, and industrial manufacturing will account for the largest share in the future

According to the panoramic map of the 5G industry chain compiled by Qichacha, the upstream electronics and communications industry chains of 5G involve multiple product industries such as optical modules, optical fiber cables, and base station antennas, and will gradually realize a recovery in performance, with main equipment manufacturers and upstream component manufacturers benefiting first. In 2021, with the improvement of 5G infrastructure coverage and the popularization of 5G terminals, 5G new infrastructure will bring more business opportunities, and will have unlimited potential when it is expanded to the downstream application end.

The three major themes of the intelligent era are smart factories, smart production and smart logistics. 5G is the core driving force for the development of Industry 4.0, smart factories and industrial Internet. The intelligentization of manufacturing has also become an important breakthrough for my country to accelerate the commercial deployment of 5G. IHS research forecasts that with the penetration and application of 5G in all walks of life, by 2035, 5G will create 5.1% of the global economic output, equivalent to about 13.1 trillion US dollars in economic activities. In 2035, industrial manufacturing will account for the largest share of the economic activities created by 5G, reaching 36% of the total output of 5G, equivalent to about 4.7 trillion US dollars in economic output.