On June 6, 2023, China's 5G commercial sector officially entered its fifth year. As an industry benchmark, a reporter from China Business Daily saw at the 31st China International Information and Communication Exhibition held at the same time that a large number of communication equipment manufacturers began to display 5G small base station products. A source from a manufacturer told reporters that China's 5G network deployment has entered a refined stage, and small base stations will become a key focus of 5G deployment in the coming years.

Compared with 5G ordinary base stations, small base stations have smaller size and flexible deployment, so the former is also known as the "5G macro base station" in the industry. According to their size, 5G small base stations can be further divided into three types: micro base stations, pico base stations, and flying base stations. They are commonly deployed in indoor and local scenes that cannot be covered by ordinary base stations such as airports, train stations, and sports stadiums. In addition, the reporter also learned at this year's communication exhibition that the price of small base stations is generally 1-2 times cheaper than that of macro base stations.

At the industry seminar held earlier, Li Nan, Deputy Director of the Wireless and Terminal Technology Research Institute of China Mobile Research Institute, pointed out that small base stations are an important component of 5G commercial networks. After large-scale network construction, they can low-cost and on-demand supplement the shortcomings of large network coverage and capacity. At the same time, customers in industries such as factories, mines, and hospitals have a strong demand for flexible networking of 5G small base stations.

The latest statistical data from the Ministry of Industry and Information Technology shows that as of the end of April 2023, China has built over 2.733 million 5G base stations, accounting for 60% of the global total number of 5G base stations and 24.5% of China's total base stations. The Prospective Industry Research Institute predicts that from 2022 to 2025, the annual construction volume of 5G small base stations in China will be 600000, 1.5 million, 2 million, and 1.9 million, respectively, with corresponding market progress of 39 billion yuan, 97.5 billion yuan, 130 billion yuan, and 123.5 billion yuan.

It is estimated that over 80% of the data business in the 5G era will occur in indoor scenarios, "a person in charge of a domestic 5G small base station manufacturer who participated in the exhibition quoted data from the" White Paper on Indoor 5G Scenarioization "previously released by China, telling reporters that in the next three years, the procurement volume of domestic operators for 5G small base stations is expected to increase in scale.

Both upstream and downstream of the industrial chain benefit

The operational laws of the domestic communication industry are mostly initiated by the three major operators and gradually transmitted to the downstream of the industrial chain, and small base stations are no exception. The reporter noticed that since 2022, operators have started to purchase 5G small base stations in a centralized manner.

According to procurement information, on May 12, 2022, China Telecom took the lead in initiating the procurement of 5G low specification digital room sub station equipment and customized equipment procurement. On the 23rd of the same month, China Mobile launched a customized development and trial production service project for the 5G Femto family small base station research and development project, which requires clear inclusion of products such as integrated small stations, integrated leather base stations, and integrated watt level small base stations.

On August 4, 2022, China Mobile announced the bidding information for the centralized procurement of expanded leather station equipment from 2022 to 2023. The bidding situation showed that the estimated procurement scale for this centralized procurement was about 20000 stations, with a centralized procurement amount of nearly 1.3 billion yuan. The winning shares were mainly obtained by small and medium-sized suppliers such as Jingxin, Saites, Ruijie Network, and Xinhuasan.

Small and medium-sized manufacturers are the main beneficiaries of this round of small base station procurement. "Zhou Guijun, editor in chief of C114 Communication Network, told reporters that compared to Acer Station, small base stations have lower prices and smaller profit margins. In addition, the overall shipment quantity is difficult to match Acer Station, making it difficult for top equipment manufacturers to have sufficient attractiveness.

At the same time, facing the high investment in 5G network deployment, operators also hope to reduce cost pressure by purchasing lower cost small base stations. Some operators told reporters that top device manufacturers have actually launched some competitive small base station products, but they are mainly used in high-value government enterprise private network scenarios, such as coal mines and power industries. In more common indoor scenarios such as supermarkets, office buildings, hospitals, schools, etc., the products of small and medium-sized manufacturers can also meet demand and have higher cost-effectiveness.

Although 5G small base stations may seem small, due to the complex indoor scene requirements, it is difficult for equipment manufacturers to provide differentiated solutions, making it difficult for top equipment manufacturers to fully grasp them. "The operator stated that small and medium-sized manufacturers are more willing to provide personalized small base station solutions for niche customer groups.

It is worth noting that small base station products also require technical verification from the operator's network. Many small and medium-sized equipment manufacturers have participated in the relevant testing and verification of operators. At this exhibition, Chief Engineer Zhao Zhuxing of Setex revealed that after signing a framework contract with China Mobile Group in November last year, trial operations were carried out in multiple provinces, and the equipment operated smoothly. Afterwards, Setex also began large-scale supply and commercial deployment.

Chip self-developed and accelerated

Similar to any communication hardware product, chips are also the core components of 5G small base stations. On traditional 5G macro base stations, most of the core chips are contracted by foreign manufacturers such as Intel, Qualcomm, and NXP. However, with the acceleration of domestic self-developed innovation, domestic manufacturers are gradually becoming self-sufficient in 5G small base station chips.

In February of this year, China Telecom Research Institute announced that it had successfully developed a 5G expandable small base station localization pRRU (picosecond station), with a 100% localization rate of chips and devices, achieving the national production and development of small base station products in China. According to the China Telecom Research Institute, the RF transceiver chips and DFE chips of the 5G small base station product developed in this project are all from domestic manufacturers, and the integrated application of domestically produced chip devices for the entire product has been successfully achieved.

The reporter learned from sources related to China Telecom that the main end-to-end business of this product has completed laboratory testing, and typical indicators meet the requirements of industry and enterprise standards. The project team will carry out field trials and promote the application of a small base station system based on domestically produced pRRUs within the year.

The reporter also learned at this exhibition that both Huawei's LampSite and ZTE's Qcell have adopted mature self-developed chips for their 5G small base stations, and local enterprises represented by chip companies such as Bikoch Microelectronics and Silang Technology have also become the main players in similar markets.

During the current communication exhibition, CEO of Silang Technology, Cha Hao, stated that his latest UCP4008 is a truly domestic small base station chip that has been independently developed from the core to instruction set, SoC, and upper layer applications, which can better support future domestic 5G applications. In addition, Silang products are also developing a self-developed home base station system level chip. It is revealed that the chip will be released in the first quarter of 2024 and returned in the second quarter of 2024.

Semiconductor analyst Ji Wei told reporters that 5G small base station chips are mostly developed for specific scenarios, and indoor scenarios require complex requirements. A single solution is difficult to meet the demand for differentiation. Therefore, based on architecture based design, software plays a significant role in small base stations, which is the strength of Chinese manufacturers.

However, Zhao Zhuxing also reminded that compared to foreign communication equipment giants, there is still a certain gap in performance, power consumption, and other aspects of domestic small base station products. After solving the problem of "from scratch", the next direction will be "from scratch to excellence".

New Role in Computing Network Layout

In the industry's view, the emergence of 5G small base stations also means that 5G development has entered a new stage. Du Jiadong, Deputy Director of the 5G Application Innovation Center of the Chinese Academy of Information and Communications, recently pointed out that the development of 5G has entered the second half, and promoting application development has become a focus of attention for all parties. Especially in the field of to B, in order to ensure the continuity of industry enterprise business, the collaboration of "macro station+small station" will become an inevitable development trend of 5G to B.

It is worth noting that small base stations, as the closest small terminals to users, are also considered important nodes on the edge of the network. If linked with cloud networks, they can effectively solve network congestion and divert network traffic. Regarding this, Zhao Zhuxing stated that the significant difference between 5G small base stations and 4G small base stations is that 5G small base stations are cloud based small stations promoted by cloud computing technology, which can make the network more flexible and have stronger operation and maintenance capabilities.

Li Nan pointed out more directly that in addition to providing an important supplement to public network coverage, 5G mini NodeBs also have the ability to support cloud, intelligence and integration with edge computing and other technologies, can provide overall solutions for vertical industries such as industrial Internet, and will play an important role in the construction of 5G private networks in the industry.

This also means that operators can still explore a lot in diversifying the role of small base stations, "Zhou Guijun said. The current focus of operators is to build a new generation of computing infrastructure, which is the" computing network "that the three major operators are focusing on building. As an edge node of the network, small stations can undertake more functions.

According to the capital expenditure plans publicly announced by the three major operators, China Telecom Computing Power (Cloud Resources) is expected to invest 19.5 billion yuan in 2023, a year-on-year increase of 39.3%, bringing the total scale of computing power to 6.2 EFLOPS; China Mobile invested 45.2 billion yuan in computing power network, a year-on-year increase of 34.9%; China Unicom's computing power network is expected to invest 14.9 billion yuan, a year-on-year increase of 20.2%.

At present, the three major operators are reducing 5G construction expenses and increasing investment in computing power networks, and small base stations will be a major focus on the edge side of computing power networks. "An operator told reporters during the communication exhibition that from this perspective, 5G small base stations may have moved away from the pure 5G network category and entered a larger computing network field, which is destined to play a key role in the next operator strategy.