Developing Telecoms Finds That 5G Drives Positive Revenue Performance for Chinese Operators

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Developing Telecoms finds that China’s telecommunications industry has registered faster revenue growth in the first quarter of 2021 riding on the wave of 5G.

Combined industrial revenue rose 6.5% year-on-year to 360.1 billion yuan (about $55.46 billion) in Q1, up 4.7 percentage points from the same period the previous year. By the end of March, China's three telecom giants — China Telecom, China Mobile, and China Unicom — had 1.6 billion mobile phone users, with the number of 5G subscribers reaching 285 million. In the past, the operators’ business performance has shown slower growth or even negative growth, especially with average revenue per user (ARPU) declining year after year. The improved performance of Q1 is very eye-catching in the market.

In their official financial reports, Developing Telecoms finds that the operators mentioned 5G as a major driving factor. One of the reasons in driving 5G development in China, Developing Telecoms believes that it is because the country has accelerated infrastructure construction to support the development of the 5G sector in the past two years. At the end of 2020, the Ministry of Industry and Information Technology (MIIT) announced that China will build 600,000 base stations for 5G telecommunications networks in 2021, and will further promote 5G network construction and applications including accelerating the roll-out in major cities.

To Developing Telecoms’ understanding, several research reports also indicated that the Chinese telecommunication market is arguably leading the way with the adoption of 5G and China’s rapid adoption of 5G technology is powering demand for 5G smartphones too. Developing Telecoms expects to see the huge demand on 5G smartphone shipments and 5G annual data traffic spike in China and thus, keep on pushing revenue performance for Chinese operators.