[ad_1]
China's sleepy telecom campaigns woke up after Meng Wanzhou, chief financial officer of Huawei Technologies Co., was arrested in Canada in early December. Although the official accusation was that the company violated US sanctions against Iran, many Chinese experts have stopped the detention, representing a new attempt by the US government to arrest US officials. prevent the country from progressing in 5G.
According to the European Telecommunications Standards Institute, Huawei is one of the world's leading manufacturers of new generation wireless technology patents.
The annoyance of the Chinese equipment maker has fueled the enthusiasm of investors for them to spend money on everything related to 5G. December 7 The Ministry of Industry and Information Technology granted 5G spectrum licenses to three telecom operators, allowing them to complete the latest tests before global commercial delivery in 2020.
A month later, the government announced that it would issue temporary licenses in some cities this year. Unlike Europe and the United States, China does not waste time developing 5G.
Wireless antenna manufacturers and China Tower Corp. shares, owned by the state, are shredded like hot buns. The shares of mobile tour operators in Hong Kong have increased by more than 40% since early December and their market capitalization reached $ 37 billion.
On Monday, when Chinese dealers returned to work after a week-long New Year holiday, dozens of continental companies producing wireless antennas grew by 4.3 percent, while Comba Telecom Systems Holdings Ltd., established in Hong Kong, jumped more than 70%.
However, investors who are rushing to take the 5G train to China could face considerable difficulties. It is best to try to invest in major equipment manufacturers – especially Huawei, a privately managed company, and ZTE Corp., which sells in Hong Kong and Shenzhen, and claims to have acquired more than a thousand important licenses for 5G.
However, for now, it is rare to dare to buy ZTE shares. 2017 At the end of the year, the company had a market value of $ 23 billion, speculating on a faster investment in 5G, but it slowed down in June after the US banned critical technology to punish the violations of sanctions imposed by Iran.
Although insurance has been replaced by a $ 1 billion fine and the reorganization of the board, geopolitical issues remain relevant. ZTE 35 percent continues to earn its revenue in overseas markets, which are currently on the battlefield, with China fighting with the United States for the supremacy of 5G.
Antennas are, in comparison, a worse bet. Theoretically, with the 5G era, operators will buy a lot more. The so-called Mbadive MIMO technology will allow simultaneous transmission and reception of multiple data streams on the same radio channel using different antennas.
However, the reality is that Chinese public operators are reluctant to deal with a large number of suppliers and instead use a centralized procurement system to buy everything from major manufacturers such as Huawei and ZTE. For my part, some works are ceded to third parties, such as Comba. When demand for antennas will increase significantly, Huawei and ZTE will get the lion's share, leaving little revenue.
The problem with China Tower is the corporate governance. Its main clients are China Mobile Ltd., China Unicom Hong Kong Ltd. and China Telecom Corp. are also its main shareholders. From 2013 to 2017 These three operators have spent 1.7 trillion yuan (250 billion dollars) in capital costs from 3G to 4G. The installation of the 5G will cost even more and the base station will cost twice as much as the 4G.
For operators, this is an incentive to minimize the cost of mobile tours. They used the methods without compromise before. According to Citi Research, in 2014, when wireless Internet providers switched to 4G, the average cost of building base stations decreased by almost half. China Tower is currently taking 10%. overload.
The arrival of 5G in China for many people – from OEMs to electric car manufacturers to consumers – will be a veritable gold vase. However, the maximum return of equity investors will remain inaccessible. The most delicious morsel is for the elect.
[ad_2]
Source link
