Editor’s note: This article is from the micro-channel public number “Central European Business Review” (ID: ceibs-cbr), Author: Qi Qing, 36 krypton release authorized.
All changes in communication technology will produce new business and consumer scenarios, which is also an opportunity for emerging companies to achieve development and catch up.
On March 4, 2020, at a meeting held by the Politburo Standing Committee of the Communist Party of China, the decision-makers emphasized, “We must accelerate the construction of major projects and infrastructure that have been clearly defined in the national plan, including the acceleration of new foundations such as 5G networks and data centers.Facility construction progress “.The concept of “new infrastructure” has begun to be widely concerned by society.
At the press conference of the National Development and Reform Commission on April 20, the scope of “new infrastructure” was clearly defined for the first time, including information infrastructure, converged infrastructure, and innovative infrastructure.Among them, information infrastructure includes communication network infrastructure represented by 5G, Internet of Things, industrial Internet, satellite Internet, new technology infrastructure represented by artificial intelligence, cloud computing, blockchain, etc .; data center, intelligent computingThe computing power infrastructure represented by the center; the converged infrastructure mainly based on intelligent transportation infrastructure and smart energy infrastructure; and the innovative infrastructure represented by major scientific and technological infrastructure, science and education infrastructure, and industrial technology innovation infrastructure.
Unlike the direct investment in the “Tie Gongji” in the past, the new infrastructure no longer emphasizes one-sidedly relying solely on investment to promote economic growth, avoiding the “water flooding” economic stimulus, and paying more attention to the role of investment in promoting economic endogenous growth.
In this new infrastructure, 5G is mentioned as the top priority.Why 5G is so important, because as a communications infrastructure, its technological leadership has a profound impact on the national economic development.
Before 5G, the last communication strategy that was promoted to national strategic height was the “National Information Infrastructure” engineering strategy during the 1993 Clinton period, also known as the “information highway” strategy.The information superhighway strategy comes from Clinton ’s presidential campaign document “The Vision for Reviving the United States”: “The highway network established in the United States in the 1950s has enabled the United States to achieve unprecedented development in the next 20 years. In order to make the United States prosper again, it is necessaryBuilding a ‘road’ in the 21st century will provide Americans with employment opportunities and the US economy will grow rapidly. ”
The main measure of this strategy is to plan to invest US $ 400 billion to connect government agencies, research institutes, enterprises, libraries, schools, shops, and household computers with optical cables or cables in 20 years to maximize informationshared.The information superhighway strategy puts American companies at the top of the information industry chain and firmly controls the Internet infrastructure. For example, there are 13 IPv4 root servers (the lowest-level facilities on the Internet) responsible for Internet domain name resolution.American management says it is not an exaggeration to say that the United States controls the lifeblood of the Internet.
Therefore, as a new generation of communication infrastructure, 5G has been promoted to the top of the new infrastructure, which has important practical significance.
01 Telecom investment is an effective means to stimulate economic growth
As an important part of infrastructure, the telecommunications industry covers a long industrial chain. Through investment stimulation, it can effectively stimulate economic growth in the economic downturn.
We look at the contribution rate of China Telecom’s fixed asset investment to GDP growth from 2003 to 2017.As shown in Figure 1, the substantial investment in fiber broadband in 2003 contributed 6.56% to GDP.At the end of 2008, China was affected by the economic crisis in the United States and the economic growth rate declined. However, we can see that the telecommunications investment’s pulling effect on the economy in 2008 was slightly higher than that in 2007.
Figure 1 The contribution rate of telecommunications investment to GDP growth
In 2009, China took advantage of 3G upgrade opportunities, directly invested 160.9 billion yuan for 3G construction, spurred indirect investment of nearly 600 billion yuan in the country, driven direct consumption of 36.4 billion yuan, created 260,000 direct jobs, and contributed to GDP growth.Reached 4.93%.Driven by 3G industry investment, China’s economic growth rebounded in 2009 and 2010.
02 All changes in communication technology will spawn new industry giants
Among the changes in communication technology, not only has it spawned a brand new industry, it is also full of competition for communication standards in various countries.In the industrial upgrading of Chinese companies, few companies in the communications field are able to catch up in a short time and surpass in some areas.
In the 1G era, the foundation of Chinese enterprises is almost zero, and international technology has been fully introduced. In the 3G and 4G eras, Chinese companies have begun to have a say. In the 5G era, Chinese companies have already had an indispensable influence in the formulation of standards.
1G networks have been commercially available since the 1970s and can only transmit voice in the form of analog signals.Although there are many defects in the 1G network, for the first time, the 1G network has given the phone mobility, which has greatly enriched the usage scenarios of the phone and made the mobile phone a new consumer category.
In the era of 1G networks, due to the extremely low bandwidth and the low number of available connections, the overall promotion of business innovation is relatively small. Emerging enterprises are telecommunication operators, equipment manufacturers, mobile phone manufacturers and other companies directly related to 1G networks.Enterprises are the absolute master in this field.
Wired Internet is developing synchronously with mobile networks. In the 1990s, people realized the interconnection and interoperability of computers on a global scale for the first time.At that time, the dial-up network was used, with low access bandwidth, high number of connections, and high delay. The network mainly transmitted text and simple pictures.So during this period, web applications focused on portals that provide one-stop services.Like Yahoo at the time, Netscape and AOL were no less famous than Apple and Uber today.During this period, American companies still occupy the commanding heights of the industry.
At the same time as the development of wired networks, wireless networks are constantly improving.The 2G network was commercialized in the early 1990s.Because the anti-interference ability of 2G network has been greatly enhanced, digital signals enable mobile phones to access the Internet using WAP for the first time. Although the maximum connection speed of 2G is only 384Kb, it still allows mobile phones to obtain some functions that only computers have. At this time, mobile applicationsThe first signs appeared.Lightweight application software such as mobile QQ began to appear.
But at this time, the focus of Internet companies is still on the more powerful PC side.This is because the large amount of optical fiber laying has greatly increased the home bandwidth, and cable broadband has become popular.The massive amount of information has made users dissatisfied with just browsing portals. People need a tool that can quickly retrieve network information. This has brought about the prosperity of search engines. Google was once the most dazzling enterprise in Silicon Valley.
At this time, information and service-oriented enterprises began to surpass operating systems, operators, and equipment manufacturers, and became a new growth point.Open source software has begun to prevail, and exclusive patents are no longer the only factor for companies to gain a competitive advantage. The business model and data assets of companies have begun to play a more important role, which has enabled companies with huge markets to start to gain unique advantages in competition.
During this period, Chinese information technology companies began to rise. In the competition with international giants, we can at least win in the local market, such as Taobao and eBay, QQ and MSN. Although they are still at a disadvantage in core technology, they rely on closerThe business model used by domestic users has won in the domestic market.
At the same time as the rapid development of wired broadband, wireless networks ushered in the 3G era at the beginning of the 21st century.Compared with 2G, the bandwidth of the 3G network has been greatly improved. The theoretical maximum speed can reach 100Mb. The wireless network has ushered in the multimedia era. The mobile phone has got rid of the WAP network. In the experience of data browsing, it can finally achieve almost the same experience as the computer. Picture, Animation, video can be presented on the phone.
In the popularization of 3G networks, the high-end manufacturing model of the integration of software and hardware of smart phones has begun to reverse the industrial logic of the smile curve, and the profit of hardware has begun to return.Apple is the most representative enterprise during this period.Before the era of 3G mobile phones, the most powerful companies in the U.S. technology sector were Microsoft and Google. The extremely low marginal cost of software and network services could support the nearly unlimited expansion of enterprises.
The launch of Apple’s mobile phone has greatly changed the logic of the industry. Modularized high-integration design, highly integrated hardware and software products, and complicated hardware processing technology have made Apple’s mobile phone market 70% of the global mobile phone market once the iPhone is launched.With the above profits, Apple’s market value also surpassed Microsoft and Google for the first time in the 3G era, becoming the first US technology stock.Driven by smart phones, App applications have begun to emerge in large numbers. Social, shopping, and LBS have developed rapidly during this period. Whatsapp abroad, Facebook, and WeChat in China have become super portals for a while.
In December 2013, the Ministry of Industry and Information Technology issued 4G licenses to the three major operators, marking the arrival of the 4G network era.In the 3G / 4G era, mobile technology began to challenge traditional information technology companies. Qualcomm, which has 3G / 4G core technology, grew into a world-class giant during this period. In 2002, Qualcomm’s market value was less than 20% of chip giant Intel.And in 2012 when 4G began to be promoted, Qualcomm’s market value briefly surpassed Intel (Figure 2).
Figure 2 Intel and Qualcomm market value comparison (unit: million US dollars)
Although Intel relies on breakthroughs in high-end chip fields such as artificial intelligence and cloud computing, Qualcomm, which focuses on the mobile market, can maintain its market value in the range of more than 80 billion U.S. dollars for a long time, and has established its position as an industry giant.Qualcomm’s business model is to use 25% of the company’s revenue for basic technology research and development, and provide almost all patented technologies to user equipment licensees and system equipment licensees. Only patent licensing fees can bring Qualcomm nearly 10 billion US dollarsIncome.
03 5G industry is a rare opportunity to catch up
Compared with 4G, 5G technology has greatly improved the three key indicators of bandwidth, connection, and delay (Figure 3), especially the delay can be reduced to 1 millisecond, which has met many requirements for high-speed pipeline, automatic driving, and high-precision machinery.The operational requirements of the arm, the advent of 5G, for the first time allows communication technology to enter the industrial production field. If 3G and 4G are more mobile Internet penetration into the consumer side, 5G will realize the penetration of mobile networks into the industrial production side.The Internet of Everything is changing.
Figure 3 5G application scenario
The commanding height of the transformation of communication technology is the ability to control industry standards. According to the statistics of the China Institute of Information and Communications, Chinese companies have performed well in the declaration of 5G essential patents. Huawei is far ahead with 1,970 patented technologies. Chinese companiesThe number of patents accounts for 30% of the total number of patent declarations.Although the number of patent declarations does not fully reflect the technical strength of the enterprise in this field (the enterprise may hold certain patents without declaration, and the degree of patent impact on the industry cannot be measured by quantity alone), it is similar to the 3G and 4G eras.In contrast, Chinese companies already have a considerable say in international communications.
Figure 4 2018 5G standard essential patent declarations
At the International Wireless Standardization Institute 3GPP meeting in November 2016, the PolarCode solution led by Huawei defeated Qualcomm ’s LDPC solution and France ’s Turbo 2.0 solution, and was adopted as the 5G enhanced mobile broadband (eMBB) scenario control channel encoding solution.At the same time, the SBA network architecture proposed by China Mobile in conjunction with 26 companies was recognized as a unified infrastructure by 3GPP.
04 5G will bring the prosperity of supply-side industries
The strategic value of 5G technology lies in not only promoting the development of communication technology and Internet-related industries.The three technical indicators of enhanced mobile broadband, massive machine communication and ultra-high reliability and low latency communication have been greatly improved, creating a variety of application scenarios that can drive the development of a number of related industries.Especially compared with the transformation of 4G technology on the consumer side, 5G will exert a far-reaching influence in the industrial field.
The Internet of Things is expected to become a “super tuyere”
The Internet of Things may be the first industry to benefit from 5G.The Internet of Things technology and industry chain are gradually maturing, and edge computing is expected to become the next outlet.Gartner research data shows that 84% of enterprises plan to incorporate edge computing into their business plans by 2021.5G’s promotion of edge computing is mainly due to the fact that under 5G networks, computing power can be more intelligently distributed among data centers and edge devices.The industrial chain of edge computing is shown in Figure 5, which mainly includes four components: equipment manufacturers, operators, third-party service providers, and end users.
Figure 5 Edge computing industry chain
Edge computing is a supplement to cloud computing and has a certain range of economics in technology.Therefore, traditional cloud computing vendors are also gathering their own advantages to actively explore edge computing scenarios.The advantages of cloud computing giants may continue to consolidate.
Short video or challenge traditional social media
Short video refers to the video that is spread on the Internet, usually shorter than 5 minutes, and has the characteristics of strong spread, low creation threshold, low viewing cost and wide content.Driven by the head KOL, short videos are very popular among the younger generation, especially the new generation has a strong desire for self-expression, and the emergence of short videos has greatly satisfied users’ demands for self-expression and emotional interaction.According to the survey analysis of 2006 netizens by AiMedia Consulting, nearly 40% of the respondents are willing to use short video instead of text communication, 41.3% of the respondents expressed a wait-and-see attitude, and only 21.4% clearly expressed their unwillingness.
With the advent of the “high bandwidth and low latency” 5G era, the clarity of short video is expected to be further improved, and users located in different regions can interconnect through 5G.Compared with the current 4G technology, the 5G network transmission rate will be 100 times the peak value of 4G, and a smoother user experience will make the promotion of short videos easier.
Telemedicine is expected to enter advanced stages such as surgery
The information density of the medical industry itself is very high, but subject to the current network transmission bandwidth and delay, the medical industry informatization is also mainly used for storage and analysis of medical information, and telemedicine is also mainly based on consultation and preliminary diagnosis.
In March 2019, China Mobile, Huawei and the Chinese People’s Liberation Army General Hospital joined forces to implement China’s first 5G-based remote brain surgery.Ling Zhipei, a neurosurgery expert in Hainan, spanned nearly 3,000 kilometers, and transmitted high-definition video images in real time through China Mobile’s 5G network, remotely controlled surgical instruments, and completed a “brain pacemaker” implant operation for a patient in Beijing.
With the support of the 5G network, the chief surgeon can operate the micro-electrode control system for remote surgery. From the beginning to the end of the operation, the incision can be sutured. There can be no stagnation in the process. The movement of the remote robotic arm must be fully synchronized with the movement of the doctor.Hysteresis, the image transmitted during the operation requires extremely high image quality, and it must be supported by huge bandwidth.At present, only 5G communication can meet these technical requirements.
Automated driving bottlenecks are gradually eliminated
Similar to telemedicine, 5G’s qualitative improvements in high-speed broadband, connection reliability, and low latency indicators also have a profound impact on the autonomous driving industry.With the continuous improvement of computing power of chip manufacturers such as Nvidia, the high latency of sensor equipment has become one of the main factors that restrict the development of autonomous driving.The 1ms delay of the 5G network can meet the information collection needs of cars at high speeds.
AR / VR will begin to spread
According to IDC’s prediction, due to the popularity of 5G technology, global AR / VR equipment shipments will reach 68.9 million units in 2022, and the compound annual growth rate will reach 52.5% in 5 years.Tremendous growth.
The low latency of 5G technology is one of the indispensable factors affecting the AR / VR experience.At present, AR / VR devices often cause dizziness during use. The main reason is that the images are not synchronized due to network transmission delays.The response time of the human eye is about 10 milliseconds, and 4G technology has a delay of about 20 to 30 milliseconds. Therefore, when the wearer moves or rotates the viewing angle, the picture refresh lags behind the human eye’s response, and there will be vertigo.5G can reduce the delay to 1 millisecond, which is much shorter than the reaction time of the human eye, and can basically eliminate the problem of dizziness.
All changes in communication technology will produce new business and consumer scenarios, which is also an opportunity for emerging companies to achieve development and catch up.In the Internet age, giants that were considered invincible in the past have gradually lost control in the era of mobile internet.How to use the commercial dividend of 5G may be a strategic issue that enterprises need to think about.
The content of this article is excerpted from the white paper “Insight of New Infrastructure Industry-5G Industry”.The complete report includes a complete analysis of the 5G industry chain, including detailed information on the size of the enterprise, financing rounds, and geographic distribution of the industry.