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China Mobile expects 5G license this year as it watches Huawei developments

Chairman says 2020 to 2025 to be 'peak period' for 5G investments

China Mobile says it is closely watching developments related to Huawei (Photo by Takaki Kashiwabara)

HONG KONG (Nikkei Markets) -- China Mobile, the world's largest mobile services provider by subscribers, expects to secure a license this year to provide commercial services based on high-speed fifth-generation telecommunications networks and is closely watching developments related to U.S. restrictions on telecommunications equipment major Huawei Technologies, its chairman said on Wednesday.

The company, along with local peers China Unicom (Hong Kong) and China Telecom, is currently conducting 5G trials in China after being allocated the frequency spectrum, or the airwaves on which the signals are carried, to offer the high-speed service.

"5G is a big investment and we will allocate investments reasonably, according to our business development" plan, China Mobile Chairman Yang Jie told reporters after the company's annual shareholders' meeting in Hong Kong on Wednesday. While the exact timing for securing the license was not known yet, the duration from 2020 to 2025 is expected to be the "peak period" for 5G investments, he said.

Yang said the company is watching events related to Huawei to assess and analyze any impact from the U.S. restrictions on Huawei. The latter is expected to play a crucial role in the rollout of 5G services by developing and supplying the infrastructure backbone needed by wireless companies to provide the service.

U.S. President Donald Trump last week signed an executive order to ban the use of information and communications technology or services that pose "an unacceptable risk" to national security, a move believed to target Huawei amid the Sino-American trade war. Washington last week also barred Huawei from buying components and technology from U.S. companies without government approval, raising some doubts over the company's ability to build the telecom gear needed for 5G.

China Mobile on Wednesday underlined its long-lasting partnership with Huawei and signaled its intention to maintain that relationship.

"Huawei has never caused any security problems to us," Yang said, adding that China Mobile will continue to cooperate with top-notch partners. "We will stick to our transparent approach to selecting suppliers" via tender, he said.

Yang said 4G handset devices can continue to be used even after the launch of 5G services, and that voice communication services will continue to rely on the existing infrastructure for 4G.

"5G and 4G will coexist for a long period of time," he said.

China Mobile shares fell 0.8% to HK$72.95 as of 11:33 a.m. in Hong Kong on Wednesday.

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