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China outpaces US in 5G

Uwe Hessler with Reuters
August 7, 2018

Unless the US moves more quickly, its firms will lose out against Chinese rivals, says a consultancy, as it found the US is being outspent by China in the race to build the next generation of wireless communication.

Guangzhou Messe Qualcomm 5G
Image: picture-alliance/dpa/L. Zhihao

According to a report published by US consultancy firm Deloitte on Tuesday, China has currently 10 times more sites to support 5G wireless communication than the United States, and its mobile phone companies added more sites in just three months last year than the US has done in the previous three years in total.

As a result, the US risked losing out on the potential economic benefits of the technology that's generally perceived as the mobile industry's future, the report said.

"Accordingly, countries that adopt 5G first are expected to experience disproportionate gains in macroeconomic impact compared to those that lag," it added.

Read more: Data privacy, 5G, A.I. and IoT paint a drab picture at CeBIT 2016

The United States led in the development of the internet and current 4G wireless communication. But its internet giants such as Google, Amazon and Uber are increasingly matched by Chinese rivals. With regard to 5G, early leadership is expected to translate into more users who generate more data that, in turn, helps improve services.

5G: The next generation

Higher spending

Deloitte backed up its claim with evidence showing that China has outspent the US in 5G development by $24 billion (€20 billion) since 2015 and has built 350,000 new cell phone towers, while the US built less than 30,000.

The report also noted that in China it may be about 35 percent cheaper to install equipment necessary to add carriers to 5G as compared to the United States.

Read more: Internet in China — no more safe havens?

Dan Littmann, a principal at Deloitte, said in a statement that "for the US to remain competitive and eventually emerge as a leader, the race to 5G should be carefully evaluated and swift actions should be taken."

Read more: The death of America's net neutrality and how it affects you

The report, however, concludes that the US could still catch up with China, and recommended an adjustment of US policy to reduce deployment time, encourage carriers to collaborate, and implement a database of statistics and best practice.

5G wireless networks all the rage at MWC