China Mobile’s 2024, in one word： Tuo!

China Mobile’s 2023 is a breakthrough year, with its operating income exceeding one trillion yuan, and its profit reaching a new record high. The construction of 5G dominates the world, the computing network has begun to take shape, and its business performance has been excellent. Under the background that telecom operators around the world are generally sluggish, it is not an exaggeration to say "learning to dominate".

Especially recently, China Mobile talked about the future development of the communication industry and the construction plan of a digital intelligence society at MWC2024, and it has become a proper master!

This is the current development foundation. Past achievements can be the foundation for the future, but it is also a burden. After all, it is easy to "make a hundred feet" and it is difficult to "go further"!

Based on the achievements in 2023 and the assessment requirements of the State-owned Assets Supervision and Administration Commission (SASAC) for central enterprises, the goal of China Mobile in 2024 is still "two growth and four promotion": "two growth"-good income growth, coordinated profit growth and "four promotion"-development quality improvement, scientific and technological innovation ability improvement, investment efficiency improvement and personnel efficiency improvement. It is basically consistent with 2023.

How will China Mobile achieve this goal in 2024? I think the key lies in one word: extension!

First, expand business boundaries

At present, China Mobile has formed a business system with CHBN+VG as the core. It can be said that this system has basically achieved full coverage of the fields and industries that China Mobile can provide services, and the next step is to expand its business depth and breadth.

The following are the business areas that I think have great room for expansion:

1, the network business:At present, the digital transformation of society is accelerating, and the business space of computing network is huge. After intensive construction in the early stage, China Mobile currently has strong computing resources, which has obvious advantages in computing network business scenarios. In 2024, we should further dig deep into the scenarios, build demonstration projects, promote the development of computing network business market, and form a stable channel for realizing computing network resources. Of course, if it can become an important component and main carrier of the national large-scale computing network, then the future of the latter computing network business is boundless.

2. AI+ business.The rise of big models, in a year’s time, China Mobile released a number of big models, including the big model of public engine base, the big model of sea computing government affairs, the big model of customer service, the big model of network, the big model of enterprise calls, the big model of Sichuan outbound bank and so on. These large models can promote the intelligent upgrade of operation and management mode internally, but more importantly, they can provide high-level intelligent business applications around the needs of the intelligent transformation of production, life and governance, which also has huge market space, especially in combination with the original resource endowment of China Mobile, which is attractive to all walks of life and can also play a role.

3. Data service:Needless to say, China Mobile’s advantages in data are also on the way to realizing data. For example, the Wutong big data platform can provide valuable information and insight for government, finance, tourism, transportation and other fields; For example, the digital networking DSSN provides low-cost, efficient and credible "data logistics" services. These have broad market space and liquidity.

4. Taiwan business:China’s mobile capability center has gathered nearly 1,000 high-quality capabilities such as artificial intelligence, Beidou high-precision positioning, and large-scale data acquisition. At present, its internal value has been quite remarkable, mainly reflected in cost saving. There is no doubt that the next step is to fully open up to the outside world, and turn China Mobile’s capability center into a capability center of thousands of industries, providing digital intelligent transformation solutions for all walks of life.

5, security business:Network information security is one of the highest tasks in China at present. From the commercial point of view, security is a trillion-dollar market. China Mobile originally had relatively strong network security capabilities, and combined with its recently acquired Venus and self-developed security capabilities, it has the strength to make security a business/service/solution to provide services for all walks of life.

6. Big video service.At present, multimedia services such as video, live broadcast, cloud games and cloud VR are popular, and the demand for high-quality video content is booming. For China Mobile, which has a network, a data center and edge computing, this can be said to be a natural business, and it cannot be missed.

7. Satellite Internet service.After the release of Huawei Mate60 last year, China Telecom’s satellite communication was out of the limelight. In the second half of the year, China Mobile obviously accelerated its deployment in satellite communication and satellite Internet. From the current wind direction, I estimate that the relevant license for China Mobile’s satellite communication should be soon. Once the license is issued, it will be a new business for China Mobile.

Second, expand network capabilities

China Mobile is the largest mobile network operator in the world, and there is no one. Just looking at 5G, China Mobile has 1.9 million 5G base stations, making it a proper global brother. But at the same time, it should be pointed out that China Mobile still has a lot of courses to make up on the network, and it still needs to further expand its network capabilities, which is not only the current development needs, but also the future layout needs.

1. All-optical backbone network:China Mobile needs to further build a reliable, stable, visible and manageable all-optical network, which is the basis for China Mobile to expand the industrial Internet, and this should be a key point of China Mobile’s current network construction.

2. 5G private network:China Mobile has a certain scale of 5G private network, but it still needs to further speed up the streamlining of the network 5G RedCap and the cross-domain network 5G LAN capabilities, such as "plug and play" 5G express line, "jump into the cloud" 5G direct connection and other lightweight services.

3、5G-A：5G-A is regarded as the further evolution and promotion of 5G network, which will release the greater potential of 5G technology. Previously, China Mobile announced that it would launch the world’s largest commercial deployment of 5G-A in more than 300 domestic cities in 2024. This deployment will include promoting the trial commercialization of a number of 5G-A network technologies, such as synaesthesia, passive Internet of Things, network intelligence, XR enhancement and industrial Internet. These technologies will help to improve network performance, expand coverage and enhance network functions, and lay the foundation for the application of 5G in the production industry.

4、6G：At present, the world has entered the competition period of 6G. Combined with the background of the current Sino-US game, 6G is facing new challenges, such as the split of international standards, the difficulty of technological integration and innovation, and the profound adjustment of industrial model. In 2024, one of the important and urgent tasks of China Mobile is to speed up the research and development of 6G, realize the breakthrough of 6G theory and technology, lead the international standards, and at the same time cultivate 6G autonomous controllable industries in advance. This task is very heavy.

Third, expand overseas markets

It’s a fact that the domestic communication market is over-saturated, but if we jump out of the domestic border and look at overseas markets, we will find that there is still huge room for growth outside. At present, 5G is still exclusive to a few countries, and most countries still stay in the 4G or even 3G stage, and the information infrastructure construction is seriously backward.

In recent years, China Mobile has been actively promoting the construction of international information infrastructure, constantly optimizing the layout of resources along the Belt and Road and around the world, continuously deepening the interconnection between China and the world, and improving the layout of new digital infrastructure of international roads (land and sea cables), stations (network access points) and islands (data centers). By 2022, China Mobile International Company has set up 36 business locations around the world to provide digital intelligence services to customers around the world.

Based on the present and looking to the future, China Mobile should give full play to the leading comparative advantages of China’s digital economy, focus on the advantageous areas such as 5G and cloud network, and actively promote the overseas expansion of China’s solutions and China’s capabilities, not only to build a "model house" for going to sea, but also to normalize the relatively perfect digital intelligence solutions such as 5G smart factories, Internet of Things platforms and 5G drones.

Considering geopolitical factors, we may not expect to replicate China Mobile in overseas markets, but at least we can make overseas markets a powerful growth point of income, which is not too difficult.

Fourth, expand investment space

In recent years, China Mobile has obviously stepped up the pace of foreign investment. In 2016, China Mobile Investment Company was established, with two direct investment entities and three fund platforms. In the past few years, the annual investment quota was not less than 20 billion yuan, and the accumulated investment enterprises exceeded 500, with the investment scale exceeding 190 billion yuan and the assets under management exceeding 250 billion yuan. In particular, in 2023, a number of major strategic projects such as Dahua, Postal Savings Bank and Phoenix Media were completed, with an investment quota of nearly 60 billion yuan. From the data in the financial report, China Mobile’s foreign investment has made a great contribution to the overall profit of China Mobile, which is estimated to be close to 15 billion yuan, and the income from investment alone is almost the same as that of China Unicom.

Of course, the return of investment lies not only in the profit contribution, but also in the ecological expansion. At present, China Mobile has invested in more than 150 key computing industries such as chips, semiconductors and quantum communication. This is very helpful for China Mobile’s joint industrial strength to become bigger and stronger. A striking example is Venus Star. After the acquisition of Venus Star, China Mobile’s competitiveness in security-related projects in the government and enterprise market has at least reached a higher level.

Fifth, expand the vitality of employees

China Mobile’s workforce structure is divided, which is my consistent view. However, how to make employees in different lines and positions work together to support the long-term development of China Mobile is the key issue that China Mobile is facing at present and in the next few years.

The competition among enterprises ultimately comes down to the competition among enterprise teams. How to mobilize employees’ work enthusiasm, stimulate employees’ vitality, and improve employees’ work efficiency and creativity is a key issue to enhance the competitiveness of enterprises, especially how to cultivate employees’ innovative consciousness and ability and develop new products and services before the current new quality productivity issue is an important task of China Mobile 2024.

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In 2023, China Mobile climbed a peak, on which the road ahead is steeper and the wind is more urgent. In 2024, it depends on how China Mobile continues to explore the situation.