China Unicom and China Telecom Joining Hands to Build a Shared 5G Network

Updated:2019/9/9 21:29

China Unicom announced that it will sign a "Framework Cooperation Agreement on 5G Network Co-construction and Sharing" with China Telecom. According to the agreement, in their joint efforts to build a 5G network nationwide, the two will be responsible for different regions, each covering the construction, investment, maintenance and operation of the regions assigned to them.

China Unicom and China Telecom agreed to team on building a nationwide 5G network. The 5G network will be based on co-share of access network and 5G spectrum resources, but core network shall be constructed independently by each party. Both parties will jointly guarantee a unified standard on network planning, construction, maintenance and service and assure the same service level in the regions that support the 5G network “co-build, co-share”. Any partnership on network “co-build, co-share” established by either party with a third party must not improperly harm the interests of the other party. The subscribers’ ownership will remain unchanged, while each party’s branding and business operation will remain independent.

The 5G network “co-build, co-share” between China Unicom and China Telecom is bad news for many companies, said by Fu Liang, an independent telecom analyst.

First, China Tower Corporation will lose a major client. Since China Unicom and China Telecom share the access network, only one of them needs to negotiate with China Tower Corporation on building 5G towers in a certain area. What's more, China Unicom and China Telecom will become the largest shareholder of China Tower Corporation.

Second, equipment vendors like Huawei and ZTE will also lose a major client.

At last, Fu stressed that “it basically has no impact on China Mobile, because China Mobile is still more powerful than the combination of China Unicom and China Telecom.”

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