Following China Telecom's announcement of its grand strategic plan for LTE-based Internet of Things (IoT), China Mobile, the world’s largest mobile communications operator, has finally decided to roll out Narrow-Band IoT (NB-IoT) under the guidance of national policies and the company's "Big Connection" strategy.
Last week, China Mobile officially initiated related collection activities. According to China Mobile’s "Cellular Internet of Things Engineering Wireless and Core Network Equipment Design and R&D," the total project amount is 39.5 billion yuan. C114 reports that China Mobile anticipates a total base station construction exceeding 400,000 units within two years, with the overall investment surpassing 40 billion yuan. Of this, around 10 billion yuan will be invested in building 145,000 new stations in 2017. Both the wireless network and core network will see significant investments.
At this year’s MWC Shanghai, China Mobile Vice President Sha Yuejia announced that the company would begin constructing mobile IoT networks in 346 cities nationwide. By the end of the year, some key cities will be commercially ready, and the number of intelligent IoT connections will increase by 100 million to 200 million households.
Industry experts noted that although China Mobile started later than China Telecom, given the maturity of the entire industry chain—especially the cost of chips and modules—the LTE IoT is expected to experience a true boom next year. Thus, China Mobile’s timing is opportune. With plans to deploy the network at 900 MHz, 400,000 sites should be sufficient to ensure full network coverage.
**Collection and Investment: A 40 Billion Yuan Opportunity**
While money isn’t everything, it’s hard to succeed without it. This is a fitting comment regarding the actions of the three major domestic operators in the LTE IoT space. In June of this year, the Ministry of Industry and Information Technology officially issued a notice promoting the construction and development of mobile IoT (NB-IoT), allowing operators to deploy NB-IoT systems in allocated IMT system bands of GSM or FDD mode. China Mobile has loosened its restrictions.
Under the combined influence of various factors, China Mobile swiftly adjusted its strategic direction. Although the annual capital expenditure remains at 176 billion yuan, the investment in NB-IoT has increased significantly.
Recently, China Mobile issued a call for tenders for narrow-band IoT antennas for 2017-2018, with an estimated total of 1.11 million panels. These include narrow-band IoT antennas (single-frequency 900MHz) and narrow-band IoT antennas (dual-band 900/1800MHz). Additionally, China Mobile launched a tender for the design and feasibility study of cellular IoT project wireless and core network equipment for 2017-2018, with estimated project costs reaching 39.5 billion yuan. Furthermore, related network survey procurement was also launched, with amounts reaching 1.56 billion yuan.
Local branches of China Mobile have moved even faster on NB-IoT than the group. For instance, in May of this year, Zhejiang Mobile launched the "IoT Action," planning to invest 2 billion yuan in network construction funds, establish two laboratories, provide 50 million yuan in IoT terminal subsidies, and build an IoT cloud platform to support 100 partners. By the end of June, the number of NB-IoT base stations in Zhejiang Mobile had surpassed 1,000.
Although China Mobile’s current focus is on NB-IoT, NB-IoT is not the entirety of China Mobile’s narrowband IoT efforts.
Some analysts noted that China Mobile has been hesitant in deploying NB-IoT, primarily due to considerations around "investment returns." However, under the guidance of national policies and the company's "Big Connection" strategy, it ultimately decided to launch NB-IoT in May of this year. Yet, NB-IoT is not the sole focus; NB-IoT is being deployed alongside LTE FDD and eMTC capabilities. Both NB-IoT and FDD are planned in unison, ensuring convergence while allocating investments efficiently. Sha Yuejia clarified that China Mobile is committed to promoting the coordinated development of NB-IoT and eMTC, achieving complementary technologies and industrial progress.
**Comprehensive Advancement: Accelerating the Maturation of the NB-IoT Industry Chain**
Currently, both NB-IoT and eMTC costs remain higher than
other IoT connections. However, with large-scale funding and commercialization on the horizon, the price of NB-IoT is gradually declining, though it remains relatively high this year.
According to Lu Liangjun, Deputy General Manager of the Marketing Department at China Telecom Group, the NB-IoT industry chain is now mature and commercially viable, but prices are relatively high, with module prices (around 120 yuan) becoming a limiting factor. For NB-IoT, the initial phase has seen rapid growth, with strong support from the second-half of the industry chain, though prices remain high (70-100 yuan). In response, operators like China Mobile and China Telecom are leveraging their industry influence and capital advantages to stimulate the NB-IoT industry chain.
For instance, in the chip sector, China Mobile has actively promoted the integration of software and hardware with the basic communication suite, thereby lowering the development cost and threshold for IoT applications. Companies such as ZTE Microelectronics, Ziguang Zhanrui, and Haisi have released chip plans for the second half of 2017, supporting connectivity with China Mobile's OneNET platform.
In the module sector, to address fragmentation issues, China Mobile collaborated with vertical industries and module manufacturers to launch four general-purpose modules. In terms of subsidies, China Mobile plans to offer special subsidies and promotions. For users employing China Mobile IoT cards as transmission channels with contracts lasting over a year, industry customers will receive subsidies covering up to 50% of their product costs.
In the main equipment sector, China Mobile launched the "Cellular IoT Technology Test" earlier this year, where Datong Mobile tested in Lanzhou, Huawei in Hangzhou, ZTE in Guangzhou, Ericsson in Shanghai, and Nokia in Fuzhou. Reports indicate that the main equipment tests yielded relatively favorable results.
This article provides an overview of China Mobile's recent initiatives in the IoT space, highlighting its strategic shift toward NB-IoT and the broader impact on the industry.
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