Huawei has eye on 5G

Telecom vendor investing in faster network

Chinese telecom equipment vendor Huawei Technologies Co Ltd announced on Wednesday that it will invest at least $600 million in research and development of fifth-generation mobile technology by 2018.

Huawei's move is part of a global trend that involves major telecom companies moving into 5G technology development as early as possible.

In May, South Korea-based Samsung Electronics Co Ltd said that it successfully tested super-fast 5G technology that allows users to download a film in just a few seconds.

The Shenzhen-based Huawei expects that the first 5G networks will be ready for commercial deployment starting in 2020, according to a company statement.

The technology will deliver peak data rates of more than 10 gigabits per second, or 100 times the speed of current 4G networks.

"5G mobile networks can provide a true-to-life video communications experience," said Eric Xu, rotating chief executive officer of Huawei.

Xu said that innovation is a continuous journey.

"While we continue to evolve our existing 4G network capabilities, we plan to invest in 5G technology to ensure that we meet consumers' demands for faster and better connections," he said.

Huawei began investing in 5G in 2009. So far, it's participated in the European Union's 5G research projects, helped establish the 5G Innovation Center in Britain and participated in joint research programs with more than 20 universities around the world.

"It's mandatory for Huawei to be more involved in 5G technology. Although an investment of $600 million over the next five years is not huge, it still demonstrates Huawei's determination to be part of the game," said Zhao Hailin, telecom analyst with research firm IHS iSuppli.

Huawei's rivals, including the Sweden-based LM Ericsson Group and China's ZTE Corp, have all moved into the field of 5G technology development, Zhao said.

In 2012, Huawei invested $4.8 billion in R&D, accounting for 13.7 percent of its annual sales. The company's R&D investment surpassed 130 billion yuan ($21.3 billion) over the past 10 years.

Although China hasn't yet started its 4G commercial service, the government is already paying a lot of attention to 5G technology development. Deputy Minister of Science and Technology Cao Jianlin said recently that the ministry will increase its investment and support for 5G technology.

According to public figures, the ministry has allocated about 160 million yuan to R&D work involving 5G technology in China this year. Cao said that China's approach to 5G innovation will be open and collaborative.

"Major international telecom companies and enterprises that are registered in China can take part in China's 5G R&D projects," Cao said.

Zhao has forecast that international 5G standards will be established around 2015, and 5G commercial networks will likely be launched in 2018.

"There are several issues that must be resolved before 5G can become a reality," said Xu.

"These include the availability of spectrum and technological challenges, such as how to engineer network architectures capable of handling increasingly higher data volumes and transmission speeds necessary to accommodate more users on the network," Xu said.

By 2020, about 6.5 billion people worldwide will use mobile networks for data communications, Huawei has estimated.

About 100 billion additional items, such as vehicles, meters, medical devices and home appliances, will also be connected to the network using 5G technology.