It’s becoming more and more common for operators to consider sharing as 5G rolls out, but it’s certainly news when two of the biggest operators in the world propose such a strategy.
In this case, there’s been an announcement that China Telecom and China Unicom will partner to build and maintain 5G radio access networks throughout China.
News reports have indicated that the operators will share spectrum resources and a single RAN network. A formal notice on the Unicom site explains: “The 5G network co-build co-share will be based on co-share of access network and 5G spectrum resources but with core network to be constructed independently by each party.” Branding will also remain separate and the two companies will be individually responsible for construction and maintenance in specific regions.
The focus on RAN sharing is important, given that the RAN can account for the vast majority of capex. But bringing down rollout costs is clearly not the only consideration. Sharing would mean that deployment time could be cut, accelerating time to market and speeding up ROI.
Another incentive, apart from the obvious ones of time and cost, is to compete more effectively with the country’s largest operator, China Mobile. Certainly reduced costs would do wonders for market competitiveness.
This agreement is not without precedent. Both operators have form in this area, with a successful, money-saving 2016 deal to collaborate on 4G network construction already behind them.