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 (China Mobile, China Unicom, and China Telecom). All three are primarily focused on developing a standalone 5G network in China, with plans to deploy pre-commercial application in 2019 and formal commercial application in 2020. China now has ~350,000 5G-operable base stations deployed, which is nearly 10 times as many as are deployed in the United States. Globally, China’s large manufacturers (Huawei and ZTE) are pushing 5G deployment through commercial sales of 5G-enabling equipment and devices primarily for non-standalone networks, and Huawei has already shipped upwards of 10,000 base stations overseas.

Overseas, China has been developing partnerships with countries and foreign companies to expand its 5G influence. In Europe, Huawei and ZTE are offering their services to build individual countries’ 5G networks, and have signed multiple 5G contracts despite pressure from U.S. officials demanding that allies block Chinese companies. Additionally, China has invested significant time and resources into its Belt and Road Initiative, including a push for Chinese-built network infrastructure to provide connectivity across the length of the route. This strategy has already had some success: in Q3 of 2018, Huawei held 28% share of the global telecommunications equipment market, up four percentage points from 2015. Huawei is expected to continue growing that share as more 5G networks are rolled out relying on Chinese telecommunications equipment. These efforts will allow China to promote its preferred standards and specifications for 5G networks and will shape the global 5G product market going forward.

In aggregate, these approaches have given competitive advantage to China in 5G technology and capability. China’s 5G strategy should be viewed in the context of the Chinese Communist Party’s (CCP) grand strategy. Like artificial intelligence (AI), 5G development is a crucial component of Xi Jinping’s “China Dream” vision and “Made in China 2025” roadmap. Social stability and economic growth are the CCP’s top priorities because failures in those two areas are seen as direct existential threats to the regime, and 5G has the potential to transition China from a capital- and labor-intensive manufacturing economy to an innovation-led, consumption-driven economy with reduced dependence on foreign investment. In light of China’s slowing growth and its ongoing trade war with the United States, the CCP likely feels pressured to pursue technological advancement initiatives like 5G more aggressively.

*For more detail on China’s 5G strategy and capabilities, please see Classified Annex.

South Korea

South Korea is closely following China in 5G maturity due to its early auction of spectrum and its general commitment to wireless technology. The South Korean government has built a clear roadmap including healthy investment to pursue 5G; in 2014, South Korea committed $1.5B to DIB 5G Study