Huawei Vice Chairman Hu Houkun: Crossing the business chasm and creating new 5G value

During the 2020 Global Mobile Broadband Forum, Huawei Vice Chairman Hu Houkun delivered a keynote speech at the conference on "Bridging the Business Rift and Creating New 5G Value".

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"Society's expectations for 5G have never been limited to the consumer sector. What everyone expects is that 5G can change society and create more new value for society. Such changes are happening in all walks of life." Hu Houkun called for: "Innovation often has no ready-made guides. We must find rigid needs in scenarios, hone our capabilities by meeting needs, improve our positioning by capabilities, and work with ecosystem partners to explore new 5G value together."

The following is the full text of the speech:

Dear friends and guests,

Welcome to the 11th Huawei Global Mobile Broadband Forum (MBBF). This is the second time it has been held in Shanghai. The last time was in 2014, when China had just started to build 4G. This year, 5G networks have been widely deployed in China and services have been put into full use. We are very happy to witness the rapid development of the mobile communications industry in the past few years.

5G network construction enters the fast lane, China leads the global business process

There is no doubt that 5G network construction has entered the fast lane globally. There are already 101 commercial networks in the world, and more than 400 5G terminals. In the global 5G development process, China is a beautiful landscape. China has deployed more than 600,000 base stations, covering more than 300 cities, and achieved 160 million connections in less than a year.

China has the best 5G network in the world. As a consumer, the most intuitive feeling is that the speed is faster. For example, in Shanghai, you can experience a downlink rate of more than 1,000 megabits, which is 10 to 20 times that of 4G.

5G is changing society

However, does 5G bring us just a faster user experience? Of course not, in fact, 5G is changing society.

During this year's epidemic, Wuhan built Leishenshan and Huoshenshan hospitals in just ten days. Huawei and operators built a 5G network covering the entire hospital in just 72 hours. With 5G connections, remote consultations, remote B-ultrasound, and multifunctional medical robots can be used, providing important support for the prevention and control of the epidemic.

Here I would like to share a case with you. The most urgent need our team received at Vulcan Mountain Hospital was not to get online, but to help medical staff put on protective clothing. The process of putting on protective clothing is very strict, and most doctors and nurses have never worn such strict protective equipment in the past. What is more challenging is that in order to prevent cross-infection, the wearing and changing of protective clothing is carried out in an isolated area, and only one person can operate at a time, which means that no one can help them on site. Therefore, many medical staff have to spend half an hour or even an hour to put on protective clothing.

5G comes in handy here. We helped the hospital deploy 5G CPE and high-definition cameras in this workspace, and used remote video interaction to guide medical staff to wear protective clothing correctly and check whether the operation is standardized. This not only helps medical staff improve their work efficiency, but also provides them with better protection.

Smart Port, from Sauna to Air-conditioned Room

In June this year, I visited Ningbo Smart Port. Gantry cranes are the most common equipment in ports, and 5G has brought about earth-shaking changes in the operation mode of gantry cranes.

In the past, gantry crane drivers had to climb to the control room more than 20 meters high and work continuously for 8 hours. During work, they had to keep their heads down for a long time, staring at the containers under their feet, and operate with both hands. A shift lasted 8 hours, and after work, they suffered from back pain, neck pain, dizziness, and cervical and lumbar spondylosis, which were common occupational diseases.

Today, with the help of 5G, Ningbo Port has successfully realized remote control of gantry cranes. Today, the driver can remotely control the crane while sitting in an air-conditioned office. The high-definition camera displays the exact location of the container on the monitor, and the operator controls the crane to land the container steadily on the truck.

The remote control of gantry cranes has increased loading and unloading efficiency by 20%. After large-scale use, it can reduce the overall labor cost by more than 50%, while greatly improving the level of unmanned operations in ports and achieving higher safety. More importantly, the working conditions of drivers have improved, occupational diseases have been reduced, and it has become easier to recruit drivers.

The application of 5G in the industry is not limited to ports. From steel to power grids, from mining to manufacturing, 5G has been applied to more industries. We understand that as of September this year, 5G has enabled more than 20 industries in China, with a total of more than 5,000 innovative projects and more than 1,000 commercial 5G service contracts for operators.

There is no ready-made path for 5G ToB

China has a sound industrial structure and a massive industrial scale. Compared with these, our achievements in the 5G industry today are only the first step. How to turn this blue ocean into commercial value is what everyone expects. However, there is no ready-made path for us to follow, because the needs of the industry vary greatly.

Everyone is more or less confused about the development of 5G in the industry. I believe you can find your questions in this picture. Today, on behalf of Huawei, I would like to share our thoughts on these issues.

Find the urgent need from the scene

There is no doubt that the current willingness of various industries to embrace 5G is very strong. However, we need to go deep into different application scenarios, find some standards, screen these needs, and find the rigid needs that are really worth our heavy investment.

Huawei proposes to select rigid demands based on four criteria: technology relevance, business potential, industry chain maturity, and the enterprise's degree of standardization.

Technology relevance refers to whether 5G is the best choice compared to other connection technologies in a specific application scenario. For example, in the remote control scenario of a port gantry crane, optical fiber cannot meet the mobility requirements of the gantry crane, and the cost of transformation is very high. WiFi can meet the mobility requirements within a certain range, but there is no way to meet the large uplink bandwidth requirements required for high-definition video backhaul. 5G can solve all these problems, so in such a scenario, it can give full play to the advantages of 5G technology to meet rigid needs.

Business potential refers to the demand brought about by specific scenarios, whether it can be replicated on a large scale in different industries, and whether a business model that is beneficial to all parties can be formed around these application scenarios to encourage everyone to continue investing.

In industries with relatively mature industry integration capabilities and application developers, 5G, as a key connectivity capability, can be easily and quickly embedded, which is more conducive to the rapid promotion of 5G technology.

The degree of standardization is easily overlooked in the scene and demand screening, but it is very important. For industries and scenes with a high degree of standardization, 5G technology is more likely to achieve twice the result with half the effort. For example, the port industry already has mature enterprise standards. At the end of this year, the smart port communication enterprise standard jointly developed by us and our customers and partners will be released. With the guarantee of standards, it will be very easy to use and promote 5G technology in other ports.

After screening based on these dimensions, we identified some typical scenarios, such as remote control, video backhaul, machine vision, and personnel and equipment positioning. These scenarios are common and urgent needs in the industry and are worthy of our deep investment.

The network must be able to adapt to different application scenarios

The network is the foundation of 5G services. However, in the face of different needs between ToB and ToC, the network also has different requirements. The "regulation, construction, maintenance, and optimization" capabilities of network equipment and networks need to match the diversified scenario requirements of the industry. This requires manufacturers and operators to work together to deeply understand the actual industry and continue to innovate. Huawei is ready for this. In the subsequent speeches at this forum, my colleagues will share with you their thoughts and practices in this regard.

5G industry terminals: more types and lower costs

I believe that in the development of 5G industry applications, terminals are an issue that cannot be ignored and cannot become a bottleneck. To solve the problem of terminal ecological prosperity, on the one hand, we need to increase the types of modules, and on the other hand, we need to reduce the price of modules.

Since the release of the first 5G module, in more than two years, more than 20 suppliers around the world have provided more than 60 5G modules and more than 140 industry terminals, including 5G AGVs, 5G cameras, 5G drones, and 5G inspection robots.

There are currently more than 1,400 4G modules on the market. I believe that as the scale of 5G applications becomes larger and the application scenarios become more abundant, the number of 5G modules will soon reach or even exceed the level of 4G modules.

Reducing costs is also the key to enriching the 5G terminal ecosystem. This chart predicts the price curve of 5G modules, which will continue to decline in the future.

During the Double 11 shopping festival this year, China Mobile offered 5G modules for RMB 799 to the market, which is a very positive signal. Huawei predicts that by the end of 2020, the price of 5G modules will drop to around US$100, and further drop to around US$40 by the end of 2022.

5G ToB requires new capabilities

5G ToB is not just about selling connections. In fact, more and more 5G ToB has been combined with the needs of enterprise digital transformation. 5G is a means of connection, but the digital transformation of ToB needs to focus on applications and architecture. Therefore, the ability of 5G ToB should be viewed from the perspective of enterprise users, rather than just from the perspective of operators providing connections.

From an industry perspective, 5G ToB needs to provide an architecture based on 5G core connectivity capabilities, which includes underlying connectivity and communications, the cloud in the middle, and a variety of industry applications at the upper layer. This architecture must be able to achieve the integration of CT, IT, and OT.

To realize such an architecture, new capabilities are required, including: the ability to provide connectivity, which operators are working hard on and can do relatively well; cloud operation capabilities, industry application development capabilities, and end-to-end integration capabilities. The latter three capabilities need to be strengthened urgently. At present, in 5G ToB cases in different industries, especially when comprehensive enterprise digital transformation solutions are required, we see that these capabilities are either seriously missing or the existing capabilities are seriously unable to meet the requirements of enterprise digital transformation. Taking system integration as an example, the integration work around enterprise digital transformation often needs to cover architecture planning, solution design, verification, integrated delivery, operation and maintenance, and continuous iteration. This is a new integration capability that most integrators in various industries did not have in the past.

So, who will fill these gaps, provide new capabilities, and play new roles? I believe that answering these questions well can provide new impetus for the development of 5G ToB.

The greater the ability, the stronger the character

In the process of developing 5G ToB, operators can choose multiple roles: they can focus on connectivity and play the role of connectivity provider; they can also develop cloud capabilities and even integration capabilities on top of connectivity and become connectivity + cloud + integration service providers. However, different roles have different requirements for capabilities, and Huawei is willing to actively help operators who are willing to make the transition.

In the era of 5G creating value, everything means change

In the next decade, 5G will play a greater role in all walks of life, and we will usher in another golden period of development. On the road from today to the future, we still have to overcome many difficulties, and every step forward means making changes.

However, the more difficult a task is, the more worth doing it is, and if you succeed, the value it brings will be greater.

Huawei is willing to work hand in hand with operators, corporate customers and industry partners, be bold in exploration, think boldly, take positive actions, and cooperate openly to achieve win-win results and move towards the future together.