Building and operating a nationwide 5G network requires massive capital investment, a large operations and maintenance team, and a well-established channel marketing system. For State Grid Corporation, which currently lacks sufficient resources, the most suitable approach would be to select an appropriate partner among the three major telecom operators.
Recently, news about radio and television broadcasters positioning themselves for 5G has continued to gain momentum. Several industry insiders revealed that during the "National 'Smart Radio and Television' Construction On-site Conference" held on November 22, Nie Chenxi, Party Secretary and Director of the National Radio and Television Administration, officially announced in his speech: "The Ministry of Industry and Information Technology has approved the participation of the broadcasting network in 5G construction, and China Broadcasting Network Corporation is currently applying for mobile communication qualifications and a 5G license." He also added, "In addition, radio and television will secure the 4.9GHz–4.96GHz frequency band—60 MHz specifically allocated for 5G development." Furthermore, broadcasters already hold an advantageous "digital dividend" in the form of the 700MHz spectrum for mobile broadband services.
State Grid Corporation refers to China Broadcasting Network Corporation Limited, established in April 2014 with a registered capital of 4.5 billion yuan. The establishment of State Grid aims to consolidate the fragmented network resources currently held by provincial companies across the country, unify and manage the nationwide cable networks under the broadcasting and television system, and take over basic telecommunications services. In 2016, the Ministry of Industry and Information Technology issued nine basic telecommunications business licenses to State Grid Corporation, effectively equipping it with all the necessary qualifications to launch broadband services. By early 2016, multiple companies—including Gehua Cable, Fujian Radio & TV, and Chongqing Cable—had collectively reached 20.11 million broadband subscribers. Meanwhile, according to the latest "China Cable TV Industry Development Report" jointly released by State Grid Corporation and Golan Research, the number of cable broadband users has now surged to 38.33 million households.
However, State Grid Corporation has higher expectations for the telecom business in the mobile market. In 2017, State Grid took a two-pronged approach: first, it jointly established China Broadband Network Co., Ltd. with several provincial grid companies to manage broadband services; later, it formed a joint venture with CITIC Group called China Broadband Mobile Network Co., Ltd., aiming to enter the mobile sector. Recently, there have been rumors circulating that China Broadband Mobile plans to raise 100 billion yuan to fund its 5G infrastructure development.
Currently, several industry insiders analyze that "since building and operating a nationwide 5G network requires robust network infrastructure, a massive operations and maintenance team, and a well-established channel marketing system—resources that radio and television broadcasters currently lack—the most suitable entry strategy is to leverage their high-quality 700MHz spectrum and valuable video content assets by collaborating with the three existing telecom operators."
In July 2018, China International Television Corporation had already signed a strategic cooperation agreement with China Mobile in six key areas: 5G technology R&D, 4K ultra-high-definition channel development, content distribution, big data, and capital investment—aiming to achieve resource sharing, complementary advantages, and mutual benefits. According to research from Shenwan Hongyuan, since the mature 3.5GHz band of the 5G industry chain was allocated to China Telecom and China Unicom, China Mobile secured the less-established 4.8GHz segment. Meanwhile, the collaboration between radio and television’s premium 700MHz spectrum and China Mobile’s strong financial resources is expected to significantly boost the advancement and deployment of 5G infrastructure.