In addition to the above scale collection projects, China Telecom and other regional branches' fiber optic cable procurement projects also include: trunk cable, photoelectric composite cable, anti-rodent armored field cable, self-adhesive invisible fiber optic cable, field cable for base stations, cluster tail cable, base station supporting fiber optic cable, etc.
The changes in the combined number of scaled outdoor and introduced fibre optic cables collected in different years are shown in the table below.
It is easy to see that in recent years, the total demand for China Telecom's outdoor fibre optic cables and introduction of fibre optic cables has basically stabilised, generally above 45.1 million core kilometres. Only for outdoor fibre optic cable, in 2020, China Telecom's outdoor fibre optic cable shrinks from the initially announced 75 million core kilometres to 45.5 million core kilometres. Entering 2021, outdoor fibre optic cable purchases reach 43 million core kilometres and introduction of fibre optic cables reach 2.1 million core kilometres, in addition to approximately 700 million metres of butterfly (round) introduction cables. The total demand for fibre optic cables continues to fluctuate, but the overall scale remains very substantial. The main reasons for this are as follows.
On the one hand, in recent years, China Telecom's capital expenditure has generally remained stable with slight adjustments. 2020 full-year capital expenditure was RMB84.8 billion, of which RMB39.2 billion was spent on 5G. 2021, China Telecom requested a 12% year-on-year decrease in capital expenditure on 5G/4G/fixed-line broadband, etc.; 5G capital expenditure remained stable, with approximately 180,000 5G base stations built by itself (shared throughout the year) The company's 5G capex will remain stable, with approximately 180,000 5G base stations built by the company itself (320,000 5G base stations will be jointly built and shared throughout the year); 4G capex will be significantly reduced year-on-year, with no more master equipment procured and existing resources further utilised; and fixed-line broadband capex will remain stable.
Data shows that in the first half of 2021, China Telecom's capital expenditure reached RMB 27 billion, including RMB 11.05 billion in 5G capital expenditure. China Telecom's annual capital expenditure plan for 2021 remains unchanged at RMB87 billion, with RMB39.7 billion invested in 5G, approximately 180,000 stations built by itself, and 700,000 base stations striving to be in use throughout the year.
It is easy to see that with China Telecom's overall capital expenditure higher than last year, 5G capital expenditure largely stable and the number of base stations increasing, the total demand for optical fibre cables generated remained stable.
On the other hand, the joint construction of 5G by China Telecom and China Unicom will further stimulate the demand for optical fiber cables. Considering the huge scale of 5G investment and the long 5G investment cycle, the Ministry of Industry and Information Technology requires joint construction of 5G networks between operators, which will help accelerate the pace of 5G construction. China Telecom and China Unicom group construction 5G network, will to a certain extent stimulate the demand for optical fiber cable, such as base stations with pull far cable, outdoor fiber optic cable, etc.. In addition, China Telecom to build 5G + optical broadband + WiFi6 "three thousand trillion" high-quality pan-connected services, will also generate a certain amount of demand for optical fiber cable.
On the other hand, the joint construction of 5G by China Telecom and China Unicom will further stimulate the demand for optical fiber cables. Considering the huge scale of 5G investment and the long 5G investment cycle, the Ministry of Industry and Information Technology requires joint construction of 5G networks between operators, which will help accelerate the pace of 5G construction. China Telecom and China Unicom group construction 5G network, will to a certain extent stimulate the demand for optical fiber cable, such as base stations with pull far cable, outdoor fiber optic cable, etc.. In addition, China Telecom to build 5G + optical broadband + WiFi6 "three thousand trillion" high-quality pan-connected services, will also generate a certain amount of demand for optical fiber cable.