The importance of China building 5G networks ahead of the United States

China may build a 5G network before the United States, and the United States is a little panicked. Is this really that important? Why? Recently, Wired magazine published an article on this issue. Let's see what it said:

The next generation of wireless services will eventually arrive. As for the standards, sorry, they have not been finalized yet, but China and the United States have already started the race to be the first to build 5G networks. At least that is the wish of the US government and the US wireless industry. In April, Meredith Attwell Baker, CEO and president of the wireless industry organization CTIA, said: "If the United States wants to win the global 5G race, there is only one chance, not a second chance." At that time, CTIA published a report that the United States lagged behind China and South Korea in the preparation of 5G networks. The report also said that if the situation cannot be changed, the US economy will suffer.

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The report echoes a document from the National Security Agency, which argues that the U.S. government should seriously consider building 5G networks. The document states that if China becomes the leader in the telecommunications network industry, it will be a winner in the political, economic and military fields. The Democratic Party of the United States is also worried. FTC Democrat Jessica Rosenworcel once said that in order to meet the challenge of China, the United States needs to re-formulate its 5G strategy.

The first part of the 5G standard has been released, but the rest will not be released until the end of this month. U.S. operators believe that 5G networks will not be available nationwide until 2020 at the earliest. The wireless industry promises that 5G will greatly increase the speed of mobile devices and make connections more reliable. It can narrow the gap between wired and wireless broadband and enable a steady stream of incredible new technologies and applications.

Why is it so important for the United States to build a 5G network before China? The benefits of 5G are obvious. The broadband speed in the United States is not the fastest in the world, and the 4G speed is not the fastest. The penetration rate is not the highest, and it lags behind Finland, Japan, and South Korea. If the United States is late to the 5G party, will its economic advantage really be eroded?

In 2016, Accenture published a report that it believed that building and maintaining 5G networks in the United States could create 3 million jobs and stimulate GDP growth by $500 billion. If China is the first to build a nationwide 5G network, will these jobs be lost to China?

Sanjay Dhar, director of Accenture, thinks that’s not necessarily the case. He said: “Even if China wins the race and builds the 5G network first, the game is not a zero-sum game.”

Communications analyst Jeff Kagan believes that the United States has the motivation to develop 5G because it is competing with China. If the United States really lags behind and can only take second or third place, will it really have a big impact on the US economy? He does not think so. Jeff Kagan said: "Which country is competing for the first place? I think this struggle is far more complicated than that."

For example, the economies of China and the United States still exist independently of each other. Recently, the US government banned domestic companies from selling components to China's ZTE, which resulted in a severe setback for ZTE. Jeff Kagan believes that even if China wins, American companies will also be the beneficiaries, and they can sell technology to China.

Providing wireless spectrum

Entner believes that China beat the United States and is more than a year ahead. This possibility is entirely possible because the United States has not yet analyzed enough spectrum for the new network. So far, the most advanced 5G technology mainly uses millimeter wave spectrum, which is in a very high spectrum range and supports ultra-high-speed transmission, but the transmission distance is a bit short. If you want to deploy a 5G network across the United States, you must install a large number of small cell antennas.

US carriers are working to get the FCC to open up more mid-band spectrum for 5G so they can use larger towers, similar to today's. If that happens, 5G deployment will be much faster. Without enough mid-band spectrum for carriers to use, 5G networks won't be able to cover the entire US when they first roll out in 2020. In November, the FCC is preparing to hold an auction to sell mid-band spectrum to US carriers, and the process officially kicked off last month.

The longer it takes to arrange spectrum, the later it will be for U.S. operators to build 5G networks. Entner believes that looking back at U.S. history, we can see that when a certain portion of new spectrum is determined to accomplish a specific mission, it usually takes several years for the first network to be launched.

China has opened up more mid-band spectrum to 5G. Why does CTIA believe that China and South Korea are ahead? This is an important reason.

NSA concerns

The National Security Agency of the United States is worried that once China takes the lead in 5G, it will pose a threat to the United States. Many operators around the world now use Huawei products, but it cannot enter the US market. If telecommunications equipment companies in the United States and its allies withdraw from the market, then US operators may have no choice but to use Chinese products.

Security experts believe that the US government's concerns are correct. Ryan Kalember, senior vice president of security strategy at security company Proofpoint, believes that although the consequences of Huawei or other Chinese companies being found to be engaged in espionage are quite serious, manufacturers may deliberately leave backdoors in their products to obtain confidential information. If new security vulnerabilities are discovered, they may also be told to others before they are fixed.

American buyers can continue to exclude Huawei products and prefer products from American companies (such as Cisco, Juniper) or European companies (Ericsson, Nokia), but this will not create too much obstacles for Huawei to dominate the world.

The same is true throughout the 5G race. Even if the United States wins the 5G race, it will not be able to stop China from advancing.