ZTE to devote 2 per cent of annual sales to develop world’s fastest 5G mobile networks

The largest-listed Chinese telecommunications equipment manufacturer will spend 2 billion yuan every year, equivalent to 2 per cent of annual sales, through 2020 to supply ultra-fast 5G networks to mobile operators around the world.

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Visitors try out smart phones at the ZTE's stand during the Mobile World Congress in Barcelona in 2016. The company has 3,000 employees engaged in 5G R&D. Photo: AFP

Published: 10:45am, 29 Jun 2017Updated: 4:51pm, 1 Jul 2017

ZTE Corp, China’s largest-listed telecommunications equipment supplier, will earmark at least 2 billion yuan (US$294 million) every year through 2020 for 5G research and development, revving up efforts to commercialise next-generation mobile networks designed to be 20 times faster than current 4G infrastructure.

Li Cui, a vice-president at Shenzhen-based ZTE, said the company would consider increasing its research and development budget in the coming years, as key markets around the world accelerate the pace of 5G deployment.

“From this year, ZTE is committed to strengthening investment in 5G,” Li told reporters on the sidelines of a 5G industry summit. “An annual 2-billion-yuan R&D investment will be the minimum in the coming years. It is certain we will slate more funds for research and development.”

Such expenditure on developing the relevant technologies behind 5G mobile networks represents about 2 per cent of ZTE’s revenue in 2016.

The new 5G mobile standard will also provide higher capacity than current 4G networks, allowing a higher density of mobile broadband users with higher reliability.