China’s 5G Story: Inspiring Rollout Journey and Ongoing Challenges

By Tianhe Xie

With its lightning-fast speed and reduced latency, 5G technology is embraced by businesses and governments worldwide and touted as the game-changer for industry. Yet, a new network is never cheap to build and maintain. Even accounting for the possibility of infrastructure sharing, the total cost of ownership for a 5G network covering Britain is estimated to be £38 billion ($47 billion USD)[1]. In addition, customer uptake of premium 5G subscriptions has faltered, discouraging operators to invest. According to a survey in 2022, the majority of the customers in the UK and US are not willing to pay more to access 5G technology, due to the ambiguity of 5G benefits[2]. Hampered by high costs and unclear revenue, the 5G rollout has been slower than expected in many countries.

When we look at China, a very different picture emerges. China is undoubtedly the leader in the 5G field in terms of deployment quantity. As of the end of 2022, China had a total of 10.8 million base stations, including 2.3 million 5G base stations, accounting for 60% of the world’s total 5G base stations[3]. It’s estimated that China’s per capita base station number is about 4 times that of the United States and 2.3 times that of the European Union[4]. In 2023, China plans to continue the construction speed of 2022 and deploy a further 600,000 5G base stations[5].

Column chart showing China's large number of 5G base stations deployed compared to the EU and the US

Source: 5G European Observatory International 5G Scoreboard; China MIIT 2022 Communication Industry Statistical Bulletin

While China’s population accounts for about 20% of the world’s population, its 5G base station count accounts for 60% of the world’s total 5G base stations. How did China achieve this rollout speed and what challenges did they overcome? This article elaborates on the China practices for 5G cost control and demand uptake, while exploring its future opportunities and challenges.

Chinese Telcos and local governments are highly motivated by central policy objectives to invest in the construction of 5G networks and find ways to finance them.

Clearly, 5G infrastructure requires a substantial amount of funds and involves multiple parties sharing risks. In 2022, Chinese telcos and China Tower built approximately 887,000 5G base stations, at an infrastructure cost of over RMB 180 billion (USD 26 billion), accounting for 43% of the fixed asset investment that year[1]. As these companies are state-owned in nature, their culture and organisational setup make them responsive to political objectives. Consequently, the steadfast policy support for 5G in China becomes a critical factor to promote 5G rollout. Since 2013, China has viewed 5G as a core part of its science and technology policy. The Ministry of Industry and Information Technology, the National Development and Reform Commission, and the Ministry of Science and Technology established the IMT-2020 5G Promotion Group in 2013, forming a government and industry alliance to promote the 5G process. Additionally, 5G has been mentioned in all important government technology policies such as Made in China 2025 and the National Informatization Development Strategy[6]. To respond to these government calls at manageable cost, in 2019, China Unicom and China Telecom signed a 5G Network Co-Building and Sharing Framework Cooperation Agreement for 5G infrastructure sharing[7]. Most local governments have also issued subsidy policies for 5G deployment, typically ranging from RMB 5,000 to 10,000 (USD 700 to 1,400) for each accepted 5G base station[8] [9].

As rollout efforts continue, customer uptake is progressing rapidly, alongside investment in commercial applications.

Annual financial reports from China’s three major operators revealed that the accumulated number of 5G subscribers in China has reached 1 billion by the end of 2022[10], accounting for over 70% of the population. Yet, the number of users using the 5G network appears to be slightly less impressive. Indeed, a report from China’s Ministry of Industry and Information Technology showed that the number of 5G mobile network users is around 500 million[1], only half of the number of 5G plan subscribers. This is not very surprising, as 5G plans often include more data compared to similar-priced 4G plans to boost sales. After purchasing 5G plans, many 5G subscribers remain on the 4G network because (1) they are still using 4G phones and (2) they dislike the discontinuous experience created by the frequent switching of 4G/5G networks.

Moving from users to enterprises, the focus of China’s 5G commercial applications is around ‘5G + Industrial Internet’, a concept firmly supported by the Chinese government. Since 2017, there have been 10+ policy papers from the central government and over 100 documents from 31 provincial governments, to support the development of 5G and industrial internet applications[11]. In particular, the new “Guidelines for the Construction of 5G Fully Connected Factories”, released by the Ministry of Industry and Information Technology in August 2022, aims to promote “the construction of 5G fully connected factories by 10,000 enterprises”[12].

Notably, a significant proportion of the local policies are funding-related, providing innovation grants or government investment funding. For example, Hefei, a city with a population of 7 million, has been providing RMB 90 million (USD 13 million) per year as dedicated funding in recent years, to support industrial internet applications, and is planning to set up a RMB 200 million (USD 29 million) fund in 2023[13]. As of the end of 2022, over 4,000 5G+ industrial internet applications are under construction, offering use cases for 20+ typical application scenarios[9]. While these applications and associated innovations successfully reduced cost of 5G IoT modules down to a quarter and lead to automation of industry tasks, such as remote equipment control and machine vision inspection, industry experts acknowledge a lack of scalable applications and are calling global players for ‘an exploration of integration synergies’ between 5G modules and industries or factories, to fully unlock the potential of 5G bandwidth and make the solution replicable in various settings[14].

Nonetheless, China’s massive 5G network is a prime laboratory environment for 5G innovation practices, providing essential infrastructure and testbeds for innovative application. Although radical, widely-adapted 5G commercial applications are yet to arise, China’s infrastructure lays a solid foundation to enable a quick adoption once successful use cases arise in the future.

While the extensive rollout of 5G networks has paved the way for innovative applications, its huge energy bill remains a challenge for sustainable operation.

Indeed, the rapid rollout of 5G networks has caused a signification increase in energy consumption and raised concerns about sustainability and operating cost. When operating at higher frequencies, each 5G base station only covers one-third of the 4G coverage area, requiring a three-fold increase in deployment density. With 5G base stations consuming approximately 3 times more power per base station unit[15] [16], this means 5G networks could result in a nine-fold increase in electricity costs and carbon emissions.

In the face of this challenge, many solutions are being trialled and introduced to reduce 5G energy consumption, and not just in China. For example, mobile operators are deploying intelligent software to power down base stations in quiet times[17]. Another example can be found in Finland, where Nokia and Elisa deployed liquid cooling 5G base stations to convert and repurpose waste heat, reducing potential energy expense by 30%[18].

Given cost and environmental concerns, it’s foreseeable that sustainability innovation will become a priority for 5G operations, as Telco companies must seek ways to optimize energy consumption if they want a sustainable 5G success at large scale.


[1] “Exploring the cost, coverage and rollout implications of 5G in Britain”. National Infrastructure Commission. 2016.

[2] “Here’s what Americans and Brits say about paying more for 5G”. Jan 2022.

[3] “2022 Communication Industry Statistical Bulletin”. Ministry of Industry and Information Technology of the People’s Republic of China. Feb 2023.

[4] “International 5G Scoreboard”. 5G European Observatory. 2022. (Accessed on 24th Apr 2023)

[5] “The Ministry of Industry and Information Technology plans to build 600,000 5G base stations in 2023, equivalent to the 2022 target”. Mar 2023.

[6] Triolo, P. (2020). China’s 5G Strategy: Be First Out of the Gate and Ready to Innovate. In S. Kennedy (Ed.), China’s Uneven High-Tech Drive: Implications for the United States (pp. 21–28). Center for Strategic and International Studies (CSIS).

[7] “China telcos weigh sharing 5G network to cut costs, potentially hurting Huawei”. Reuters. Aug 2019.


[9] “[Illustration]: Interpretation of the “Implementation Rules for Subsidies for 5G Base Station Construction (Trial)” Policy”. Department of Industry and Information Technology of Shanxi Province. Jan 2022.

[10] “Interpretation of the financial reports of the three major operators: 5G investment slows down, computing power becomes the new favourite”. Mar 2023.

[11] “<<2022 China ‘5G+Industrial Internet’ Development Effectiveness Evaluation Report>> Released”. Alliance of Industrial Internet. Nov 2022.

[12] “Notice of the General Office of the Ministry of Industry and Information Technology on Printing and Distributing Guidelines for the Construction of 5G Fully Connected Factories”. Aug 2022.

[13] “Hefei is planning to set up a 200 million yuan municipal-level industrial Internet special fund”. Anhui Provincial Department of Economy and Information. Dec 2022.

[14] “Interview with Yu Xiaohui, Dean of China Academy of Information and Communications Technology: the dual development of 5G and industrial Internet, transformation and upgrade co-happening to drive new industry energy”. Hong Xing News. Nov 2022.

[15] “What are key considerations for 5G sites?”. Analysys Mason. Oct 2019.

[16] “5G Power: Creating a green grid that slashes costs, emissions & energy use”. Huawei. July 2020.

[17] “Reducing emissions in our operations”. Vodafone. (Accessed on 26 May 2023)

[18] “Nokia and Elisa see sustainability leap in world-first 5G liquid cooling deployment”. Nokia. June 2020.