PARTNER INTERVIEW: Xiao Ming, SVP and President of Overseas at ZTE (pictured), highlights the company’s key achievements in 2020 and talks about its R&D priorities in the build-up to 6G.
Mobile World Live: What were the highlights for ZTE in 2020 and what’s your outlook for the year ahead?
Xiao Ming: Last year was unique for all of us. The chief reason was the global Covid-19 (coronavirus) pandemic. The pace of 5G commercialisation, however, has not stopped, especially not in China where it has accelerated.
ZTE reported operating revenue of CNY74.1 billion ($11.4 billion) for the first nine months, 15.4 per cent year-on-year growth. We invested around CNY10.79 billion in R&D in the first three quarters, up 15.3 per cent from the same period in 2019.
Despite demand pressure and significant challenges, we actively tapped the potential of high-speed networks, maintained steady operations, strengthened our R&D investments and took steps to improve our core competitive advantages and customer satisfaction.
By collaborating with partners from various industries, we will continue to explore new 5G applications for vertical industries and promote the implementation of new services to deliver added value to our customers.
How has the Covid-19 pandemic impacted your operations and how have sales held up in China and overseas?
The epidemic has affected the world economy and changed people’s lives. Many industries have been hit. However, as people are required to work remotely and stay at home, they rely more on communication networks, so data traffic has surged.
We continue to strengthen our R&D and maintain close communications with customers to ensure stable network operations.
What have been your main achievements over the past 18 months?
By the end of September 2020, ZTE secured 55 5G commercial contracts and collaborated with more than 90 global operators. Together with some 500 industrial partners, we are exploring numerous industrial applications.
Data from Dell’Oro showed the global RAN market grew 20 per cent year-on-year in Q2 2020, reaching $9.4 billion. Pushed by China’s domestic market, ZTE accounted for 30 per cent of the global RAN shipments in the April to June period.
After 5G was commercialised in China in late 2019, more than 718,000 5G sites were deployed by the end of November. The country’s 5G user base now tops 160 million. At the same time, the big three operators accelerated their standalone (SA) deployments and are actively exploring vertical industrial applications.
China estimates the total cost of building out 5G networks in the country will reach $165 billion over the entire construction cycle, which is 50 per cent more than the investment for 4G. Over the next five years, 5G is projected to drive $3.6 trillion in value across a wide range of vertical industries.
Outside of China, ZTE has cooperated on 5G with major operators, including Orange, Telefonica, Wind Tre, Open Fiber, Hutchison Drei Austria and MTN.
How is ZTE helping operators work with various industries to deliver compelling 5G services that real add value to their operations?
In maximize the commercial value of 5G networks, ZTE actively cooperates with industry partners to expand 5G industrial application. We have more than 500 industrial partners in 15 industries, including manufacturing, education, health care, tourism, media, transportation, ports, environmental protection and energy.
Together we have explored 86 industrial 5G applications and implemented 60 projects, accumulating valuable experience in 5G business model innovation.
For example, last year ZTE cooperated with Tianjin Port and Tianjin Unicom to build the world’s first fully integrated 5G smart port. We also are cooperating with Antwerp port in Belgium to deploy a similar automated system.
ZTE joined with Fujian Mobile and Fujian Electric Power to establish the Energy Internet 5G Technology Innovation Application Laboratory and completed the industry’s first 5G network slice at the facility.
Can you detail some of the innovations ZTE has implemented making networks more flexible, robust and efficient to operate?
With the large-scale commercial deployment of 5G in China and global markets, we never stop innovating and have always been committed to delivering the most cost-efficient applications in our network deployments. In the area of wireless products, ZTE aims to continuously improve frequency efficiency, coverage and performance.
For example, in 2020 we launched the Synchronization Signal and PBCH block, which increase coverage inside tall buildings by up to 30 per cent. And our SuperDSS, the industry’s first dynamic spectrum sharing tri-RAT, gives operators more flexibility in quickly and efficiently deploying 5G networks.
ZTE’s FDD Assists Super TDD (FAST), an uplink enhancement technology, enables spectrum to reach its full potential by integrating time and frequency domains, with the uplink peak rate increasing by 32 per cent, while improving cell coverage by 31 per cent.
Meanwhile, network energy savings has never been more important. ZTE has always committed to building greener networks, and thanks to our advanced technologies and wide experience in commercial applications, our PowerPilot helps deliver the most energy-efficient networks with robust performance and lower opex for mobile network operators.
According to typical network configuration calculations, the energy saved by PowerPilot is twice that of conventional AI-based energy-saving options. It can reduce energy consumption in a multi-mode network by up to 20 per cent, significantly lowering opex.
To date, ZTE’s network energy-saving platforms have been deployed in more than 20 networks around the world covering some 600,000 sites and saving more than $1 billion in energy expenses for operators.
Now that 5G technology is mature and network deployments are gaining momentum across the world, how will ZTE’s R&D investment focus change over the next few years?
ZTE has always attached great importance to R&D, with our annual investment reaching CNY12.55 billion.
The commercial use of 5G is still in the popularisation stage, while 6G research has been put on the agenda in the industry.
We actually started early activities towards 6G in 2018. We believe 6G will be launched in 2030 and will change the world by making all connections intelligent.
ZTE established four joint 6G innovation centres with top universities, focusing on fundamental research, such as network architectures, new spectrum bands and air interface integrated with AI, along with 6G-related materials and devices.