China is exploring whether a merger between two of its carriers will secure its lead in 5G over the US, but it could also work in T-Mobile’s favour stateside.
The country’s ongoing trade war between the US and China is said to have spurred discussions over how it can lead in the latest technologies.
A proposed merger between two of China’s three wireless carriers – China United Network Communications Group (China Unicom) and China Telecommunications Corp (China Telecom) – aims to speed up the development of 5G services.
Combined, the networks will have a total of nearly 600 million subscribers – closing the gap with China Mobile which has over 900 million. Both would represent the largest wireless networks in the world.
Working in T-Mobile’s favour
T-Mobile US is currently attempting its own landmark merger with Sprint as part of a $26 billion deal that would similarly bring the combined operators’ number of subscribers closer to the nation’s largest mobile networks, AT&T and Verizon.
The proposal is undergoing scrutiny by regulators, with some raising fears a reduction to three major carriers would lead to a less competitive market. T-Mobile and Sprint argue if the merger is allowed to proceed it would help them deploy 5G services faster.
With the race on between China and the US to become leaders in 5G, US regulators may see the impending merger in China as providing a big advantage. As a result, they may look upon the T-Mobile/Sprint merger within their own jurisdiction more favourably.
In both cases, it’s likely consumers’ wallets are going to be hit. While the mergers could lead to improved access to services, the reduction in market competition will likely increase prices – especially as operators attempt to recoup the costs spent on network upgrades.
According to Eric Xu, Chairman of Chinese telecoms equipment giant Huawei, most consumers will not even notice a ‘fundamental difference’ using 5G from 4G.
What are your thoughts on the 5G rivalry between China and the US? Let us know in the comments.
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