5G is Driving the Digital Transformation in China

The acceleration of technology over the past year has created a massive ripple effect, permanently shifting consumer lifestyles, expectations, and behaviors to a future-ready state. In response, UM APAC created the Asia-Pacific Innovation Annual – taking a deep dive into the cutting-edge advancements in entertainment, commerce, digital health, and connectivity, that are catapulting the region and providing new opportunities for brands.

The official launch of 5G networks in mainland China in November 2019 was celebrated by both business owners and consumers.

5G promised direct benefits for everyone. Consumers looked forward to leveraging faster mobile connectivity to access better telehealth services, streaming more entertainment content in high definition, playing online games with less buffering, and having high-quality video chats with families in remote locations. All these promises led some in the Chinese press to call 5G networks “the enabler of a heightened human experience.”

Since its arrival two years ago, 5G has mostly delivered on its hype and lived up to its potential. It was estimated that China in 2021 would account for more than 57% of the world’s total 5G network usage, per a 2020 report from CCS Insight. By 2025, according to the same report, China will be home to over 1.6 billion 5G devices.

 
 

Many 5G-enabled technologies and digital services have already played an important role in improving people’s everyday lives, changing the game in fields such as industrial production, energy, and medical services, while driving forward digital transformation in China. Looking ahead, 5G connectivity is playing a central role in the government’s push for Made-in-China 2025, a state-led policy that seeks to make China dominant in global high-tech manufacturing.

As more and more devices become connected, much of China’s digital economy will run on mobile connectivity, and the upgrade to 5G networks will play a critical role in its development. It is estimated that the 5G industry will contribute up to 5.8% of China’s GDP by 2030, per a 2019 report from IDTechEx Research.

Image: Camilo Jimenez via Unsplash

 
 

The wonders of 5G extend to lifestyle and media sectors, such as 8K video streaming, self-driving cars, agricultural smart grids, smart cities, and increased public security. Local tech giants have been quick to seize the opportunity and capitalize on various forms of horizontal development that 5G enabled. For example, Baidu’s recent launch of its “Robocar,” as well as the reinvention of its taxi service business to ‘Robo-taxis” with autonomous driving tech, is powered by China’s widespread 5G networks in urban areas.

Interestingly, the widespread adoption of 5G connectivity may spell trouble for one of the tech giants. According to a recent report from South China Morning Post, the “Big Three” telecom companies in China have reportedly begun collaborating on a 5G messaging platform that will give users the ability to use the messaging window on their smartphones, rather than an app, to send texts, photos, and videos.

If this new messaging platform takes off, it could go head-to-head for user attention with Tencent’s all-in-one super-app WeChat. In addition, this 5G messaging service will reportedly have its own built-in payment system, and it could correlate to some state-led efforts of popularizing the digital yuan.

5G also played a critical role during the outbreak of the Covid-19 pandemic in Wuhan. The government set up 5G stations through the country’s three major telecom carriers, dedicated to delivering high-speed connectivity to hospitals. The stations were quickly set up to broadcast the speedy construction of temporary hospitals through 4K live streaming along with 360-degree panoramic cameras. The streaming reached over 65 million viewers who watched from home to cheer on the construction workers.

China makes up 57% of the world’s total 5G network usage, per a 2020 report from CCS Insight. By 2025, according to the same report, China will be home to over 1.6 billion 5G devices.

As China deployed strict protocols on public safety, aimed at keeping orderly operations around lockdowns, social distancing, and quarantines, 5G technology quickly took over services that are traditionally driven by manual labor. XAG Robotics worked with Huawei, a major 5G equipment supplier, to quickly turn its inventory of 2,600 robots and drones into automated disinfectant sprayers. Moreover, 5G-enabled robots were sent to hospitals at ground zero to support consultation and help deliver medicine to minimize human contact.

Driverless cars, another major technological advancement unlocked by 5G, were deployed nationwide to aid in food delivery to people in quarantine and lockdown, as well as to help transport medical supplies and other goods. China was the only country that has 5G connectivity deployed at scale and leveraged it in response to the pandemic. Partly thanks to the various tech-led efforts boosted by 5G, China was able to enforce its lockdown and limit the spread of the virus.

As the rest of the world slowly catches up with the deployment and commercialization of 5G networks, China is again one step ahead, with plans to test 6G networks.

The impact of 5G continues to play out in China as the pandemic subsides, continuing to enhance people’s daily experiences, cloud-based platforms enabled by 5G are blurring the distinction between online and offline, enhancing physical experiences with AR navigation, virtual product guide, and branded content while on the go.

As the rest of the world slowly catches up with the deployment and commercialization of 5G networks, China is again one step ahead, with plans to test 6G networks. According to sources cited by publications such as Bloomberg, the state has already put in a plan to activate 6G technology by 2025, which coincides with the timing of the broader initiative of Made in China 2025.

While other markets want to compete with China and fight to be the first to launch 6G, according to a recent report by Nikkei Asia, China is already “responsible for 40.3% of global 6G patent filings, followed by the U.S. with 35.2%.”

As the traditional Chinese proverb says, 好戏在后头 (“the best is yet to come”), we anticipate more great things to come with the developments of new technologies that 5G enables, not just in the industrial fields, but also in consumer-facing industries to deliver added value to the brand experiences that businesses can provide their customers.


Featured image: Rob Hampson via Unsplash

This is the fifth in a six-part series

  1. Retail Transformation – The Future of Retail in APAC
  2. Digital Health – APAC is Paving the Way for Digital Health Ecosystems
  3. Augmented Reality: Renewed Optimism for AR Across the Asia-Pacific
  4. Podcasts See Widespread Adoption Across APAC
  5. 5G is Driving the Digital Transformation in China
  6. Wearables Unlock IoT Potential for APAC Consumers

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