Government measures to contain the spread of the coronavirus in China look set to delay the rollout of next-generation 5G telecom networks, a key technology initiative for the country's leadership. Tenders for six big 5G projects have been postponed since Jan.31, government records show. Two leading providers of crucial fiberoptic cables also have headquarters and key production facilities in Wuhan city, the epicenter of the outbreak which is still under lockdown.

(Bloomberg) -- Huawei Technologies Co. is emerging as the runaway winner in China’s $170 billion effort to build out its fifth-generation wireless networks, part of a concerted effort by Beijing to seize the lead in a key technology from the U.S. while rebooting a virus-stricken economy.Since the beginning of the year, Huawei has secured 28.4 billion yuan ($4 billion) worth of 5G equipment orders from the country’s largest carrier, China Mobile Ltd., beating out competitors like Ericsson AB and ZTE Corp. to win more than half of the 5G contracts awarded by the operator during the period, according to an analysis of procurement data by Bloomberg News.Huawei is relying on its home market more than ever, at a time its growth has all but evaporated. The 5G contract haul shows Huawei is benefiting from the domestic market and building its telecommunications expertise despite the Trump administration’s blacklisting last year. Beijing has forcefully defended Huawei, and the country’s three wireless operators -- all state-backed -- have added support through network contracts.While China has spent years striving for leadership in 5G, the effort took on greater urgency after the coronavirus led to the nation’s first economic contraction in decades. In a meeting with senior officials in March, Chinese President Xi Jinping singled out the technology’s importance for rebooting the economy. Weeks later, the country’s telecom regulator said China will “make every effort” to hasten the expansion of 5G coverage.“The focus on buildouts, handsets, and other metrics misses the fact that 5G will be a platform where innovative Chinese companies such as Alibaba, Tencent, Baidu, and a host of new tech unicorns will be able to build new applications and use cases,” said Paul Triolo, head of global technology policy at Eurasia Group. “Beijing wants Chinese companies to lead in this race to innovate on top of 5G.”China is entrusting Huawei to galvanize 5G tech, a cornerstone of a national “new infrastructure” blueprint that covers nascent technologies from the Internet of Things and autonomous driving to surveillance and factory automation. An early and successful rollout could help solidify Huawei’s position as a world leader in 5G.More deals are on the horizon. China has earmarked 1.2 trillion yuan to build 5G networks in the next five years, directly creating more than 3 million jobs in related sectors, according to the China Academy of Information and Communications Technology, a government think tank. IDC telecom analyst Cui Kai said 5G investment will continue to climb and peak in 2022 or 2023.This year, China’s three state-owned telecom carriers will spend a total of 180 billion yuan on 5G-related projects, including base stations and smartphones. China Telecom and China Unicom still have to announce bidding results.The 5G contracts give Huawei a much-needed boost as some projects in Europe grind to a halt because of Covid-19. Huawei this week reported revenue growth slowed to 1.4% in the first three months -- down from 19% over all of 2019 -- following pressure from the U.S. and dampening demand brought about by the outbreak.The Shenzhen-based company clinched deals to build more than 132,000 base stations for China Mobile across the country worth 21.4 billion yuan. The telecom carrier awarded rival ZTE Corp. 5G base station contracts worth 10 billion yuan, while Ericsson’s haul was around half of that. Nokia Oyj, which runs its China business via a joint venture with a local partner, didn’t get any of the business.Huawei won 56% of total orders by China Mobile for slicing packet network construction, or SPN, responsible for 5G data transmission between base stations and the core network. This brought in another 5.6 billion yuan in revenue.Huawei and ZTE also split 5G data management orders worth 1 billion yuan, leaving a fraction of the order to Ericsson, according to two separate procurement documents from China Mobile.In addition to 5G infrastructure, China Mobile placed orders with Huawei’s consumer electronics unit from the beginning of the year, including for about 70,000 units of the latest 5G smartphones and 140,000 5G portable Wi-Fi devices, without providing the procurement price. Most 5G phones in China cost around 4,000 yuan retail but carriers usually buy popular smartphone models from vendors at a discount.China Mobile had 31.7 million 5G package subscriptions nationwide as of March, more than doubling the subscription number in February, according to its website. 5G smartphone sales are expected to increase as more telecom carrier branches around the country place orders. Not all will be Huawei sales. So far this year, the carriers purchased more than 130,000 units of 5G smartphones from rivals Oppo and Vivo, the data show.Huawei’s 5G boost has benefited its suppliers. Shares of printed circuits board maker Shennan Circuits Co. Ltd. jumped more than 60% since the beginning of the year. Wuhan Fingu Electronic, a maker of radio frequency components used in base stations, increased by about 25%.Still, some doubt that 5G will be the savior that China is seeking. Gavekal Dragonomics analyst Dan Wang said that 5G doesn’t look like a big factor in moving the economy. “It’s a build-first-and-ask-questions later approach led by the state,” he said. “There’s not yet a killer app.”Huawei has put up a fierce fight since Washington banned the Chinese company from getting key American technologies last year. In the latest development, the Trump administration was said to consider imposing restrictions on the sale of semiconductors to Huawei by chipmakers such as Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co., a move that would effectively deprive the Chinese giant of using the most advanced chips.“There’s no question that China’s state-owned telecom operators can direct a lot of business to Huawei,” said Wang. “The company’s problem, however, is on the supply side. Escalating U.S. sanctions might be highly disruptive.”(Updates with Huawei’s latest quarterly results in the third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Jamaica-based mobile phone carrier Digicel Group denied an Australian newspaper report on Thursday and said there is "no basis whatsoever" that it would sell its Pacific unit to state-owned China Mobile Ltd <0941.HK>. Earlier in the day, the Australian Financial Review had reported that the Chinese company has been conducting due diligence on Digicel's Pacific unit since the beginning of the year, in a deal that could be worth as much as $900 million. "We can categorically state there is no basis to this whatsoever and that no approach has been made to us," Antonia Graham, head of communications for Digicel Group, said in an emailed statement.

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Chinese have long been aware that they are tracked by the world's most sophisticated system of electronic surveillance. The coronavirus emergency has brought some of that technology out of the shadows, providing the authorities with a justification for sweeping methods of high tech social control. Artificial intelligence and security camera companies boast that their systems can scan the streets for people with even low-grade fevers, recognise their faces even if they are wearing masks and report them to the authorities.

Luckin Coffee and three other Chinese stocks could be in the blast zone of newly proposed regulations.

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

(Bloomberg) -- A group of U.S. security agencies is urging the Federal Communications Commission to revoke China Telecom’s permission to operate in the country.“This recommendation reflects the substantial and unacceptable national security and law enforcement risks” associated with China Telecom’s access to the U.S. telecommunications network, the agencies said in a filing at the FCC.The U.S. and China are at odds over a suite of issues such as the spread of the novel coronavirus, trade, and security of telecommunications networks. U.S. officials have moved to bar Chinese gear maker Huawei Technologies Co. as a security threat, an assertion the company denies.China Telecom “unequivocally” denies the allegations, a representative said in an email.“The company has always been extremely cooperative and transparent with regulators,” said the representative, Ge Yu. “In many instances, we have gone beyond what has been requested to demonstrate how our business operates and serves our customers following the highest international standards.”Thursday’s recommendation to revoke an authorization held by China Telecom since 2007 is part of a review announced last year by the FCC, as the commission barred China Mobile Ltd. from the U.S. market. The FCC usually follows recommendations from security agencies.“We welcome the input of the executive branch agencies and will review it carefully,”said Tina Pelkey, an FCC spokeswoman.‘Beholden’“The threat from China Telecom is a reflection of the threat that we see from Chinese telecommunications companies generally,” said John Demers, assistant attorney general for national security. “They are beholden to the government of China both by law and in fact to do its bidding.”“We have seen behavior in violation of the mitigation agreement that we had entered into with China Telecom at the time that the license was approved,” Demers said. “That raises national security concerns.”Agencies taking part in Thursday’s filing include the Departments of Justice, Homeland Security, Defense, State, Commerce and the U.S. Trade Representative.China was also a factor in another recent regulatory decision. Alphabet Inc.’s Google and Facebook Inc. won U.S. regulatory approval for an undersea trans-Pacific internet cable on condition the project not carry data traffic to Hong Kong.“There is a significant risk that a direct cable connection between the United States and Hong Kong would seriously jeopardize the national security,” the Justice Department said in an April 8 filing to the FCC.‘Disrupt and Misroute’China Telecom offers U.S. customers access to international private lines, which it markets as providing secure bandwidth for sensitive data, according to the filing. It also offers mobile service under the CTExcel brand name, according to the filing.The Chinese government has “ultimate ownership and control” of China Telecom, and the company’s U.S. operations “provide opportunities for increased Chinese government-sponsored economic espionage,” according to the filing.The company made inaccurate statements about where its records were stored, and had “inadequate”cybersecurity and privacy practices, the agencies said in the filing.The scope of China Telecom’s activities in the U.S. wasn’t immediately clear. The security agencies said the company connects to the Internet at 18 points, giving “Chinese government-sponsored actors with openings to disrupt and misroute U.S. data and communications traffic.”The company on its website lists six U.S. offices in New York, Los Angeles and other cities, with a headquarters in Herndon, Virginia, near Washington, D.C. China Telecom works “to deliver high-quality data and voice solutions and services between the Americas and China to businesses and carriers,” according to the website.The parent company, China Telecom Corp., says it’s the second-largest mobile provider in China, with 336 million subscribers. Revenue at the company’s China Telecom Americas business has had 68% compound growth annually since 2005, according to the company’s website.(Updates with FCC statement in 7th paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

We travel to tobacco fields, out-of-favor telcos, and even China to find some of the market's top high-yielding stocks.

The U.S. Justice Department and other federal agencies on Thursday called on the Federal Communications Commission (FCC) to revoke China Telecom (Americas) Corp's authorization to provide international telecommunications services to and from the United States. China Telecom is the U.S. subsidiary of a People’s Republic of China (PRC) state-owned telecommunications company.

Learn about the top ten telecommunications companies in the world and information about each company’s customer base, market share, and services.

Coronavirus is probably the 1 concern in investors' minds right now. It should be. On February 27th we published an article with the title Recession is Imminent: We Need A Travel Ban NOW. We predicted that a US recession is imminent and US stocks will go down by at least 20% in the next 3-6 […]

Jamaica-based telecommunications company Digicel Group has offered its Pacific business as security to creditors in a debt restructuring, a U.S. Securities and Exchange Commission filing shows. The SEC filings showed Digicel Pacific as a guarantor for $941 million in new secured notes maturing in 2024. Digicel is one of the biggest mobile phone carriers in the Pacific Island region.

Read about the five largest and most influential software companies in China, including a new up and coming superstar.

Short selling of U.S.-listed companies from China and Hong Kong has climbed since the coronavirus outbreak was confirmed on Jan. 20, according to the latest report from S3, a provider of short interest and securities finance data. S3 said that $751 million new shares were shorted in the 494 U.S.-traded Chinese and Hong Kong stocks the company tracks, bringing total short interest in those stocks to $27.27 billion. S3 said it expects to see continued short-selling in Chinese/Hong Kong stocks and that this would happen primarily in the U.S. market as Chinese regulators limit short-selling on China's exchanges.

(Bloomberg Opinion) -- Big spending numbers are being thrown around in China, once again. This time, it’s trillions of yuan of fiscal stimulus on all things tech. The plans are bold and vague: China wants to bring technology into its mainstream infrastructure buildout and, in the process, heave the economy out of a gloom due only partly to the coronavirus.But will this move the needle for China to achieve some kind of technological dominance? Or increase jobs, or boost favored companies? Not as much as the numbers would suggest, and possibly very little. A country covered in 5G networks makes for a tech-savvy society; it's less clear that this money will boost industrial innovation or even productivity.Over the next few years, national-level plans include injecting more than 2.5 trillion yuan ($352 billion) into over 550,000 base stations, a key building block of 5G infrastructure, and 500 billion yuan into ultra-high-voltage power. Local governments have ideas, too. They want data centers and cloud computing projects, among other things. Jiangsu is looking for faster connectivity for smart medical care, smart transportation and, well, all things smart.  Shanghai’s City Action Plan alone is supposed to total 270 billon yuan.By 2025, China will have invested an estimated $1.4 trillion. According to a work report released Friday in conjunction with the start of the National People’s Congress, the government plans to prioritize “new infrastructure and new urbanization initiatives” to boost consumption and growth. Goldman Sachs Group Inc. analysts have said that new infrastructure sectors could total 2 trillion yuan ($281 billion) this year, and twice that in 2021. Funding is being secured through special bonds and big banks. The Shanghai provincial administration, for instance, plans to get more than 40% of its needs from capital markets, and the rest from central government funds and special loans. Thousands of funds have been set up in various industries since 2018, and some goals were set forth in previous plans.Policymakers are aggressively driving the fiscal stimulus narrative through this new infrastructure lens. Building big things is a tried and true fallback in China, from the nation’s own road-and-rail networks to its most important soft-power foreign policy, the belt-and-road initiative to connect the globe in a physical network for trade. It’s less obvious that this will work for technology. The reality is that the central-government approved projects add up to only around 10% of infrastructure spending and 3% of total fixed asset investment. The plans lack the focus or evidence of expertise to show quite how China would achieve technological dominance. Thousands more charging stations for electric cars won’t change the fact that the country has been unable to produce a top-of-the-line electric vehicle, and demand for what’s on offer has tanked without subsidies. With their revenues barely growing, China’s telecom giants seem reluctant to allocate capital expenditures toward the bold 5G vision. China Mobile Ltd. Chairman Yang Jie said on a March earnings call that capex won’t be expanding much despite the company being at the outset of a three-year peak period for 5G investments. Analysts had expected it to grow by more than 20%, compared to the actual 8.4%.Laying this new foundation for the economy, which includes incorporating artificial intelligence into rail transit and utilities, requires time, not just pledged capital. It’s hard to see the returns any time soon, compared to investments on old infrastructure. These projects are less labor intensive, so there’s no corresponding whack at the post-virus jobless rate that would help demand. State-led firms that could boast big profits from sales of cement and machinery on the back of building projects, for instance, can’t reap money as visibly from being more connected.Spending the old way isn’t paying off like it used to, either. Sectors such as automobiles and materials, big beneficiaries of subsidies and state funding, have seen returns on invested capital fall. The massive push over the years gave China the Shanghai maglev and a vast network of trains and roads. But much debt remains and several of those projects still don’t make money. Add in balance-sheet pressures and spending constraints, and every yuan of credit becomes less effective. There’s also expertise to consider. Technological dominance may require research more than 5G poles. China’s problem with wide-scale innovation remains the same as it has been for years: It always comes from the top down. Beijing has determined and shaped who the players will be. Good examples are the 2006 innovative society plan and Made in China 2025, published in 2015, that intended to transform industries and manufacturing, and have had mixed results.China is unlikely to get the boost from tech spending that it needs to solve present-day problems, especially in the flux of the post-Covid-19 era. Ultimately, the country will just fall back on what it knows best: property, cars, roads and industrial parks. The economy is still run by construction, real estate and manufacturing. Investors should think again before bringing in anything but caution.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Anjani Trivedi is a Bloomberg Opinion columnist covering industrial companies in Asia. She previously worked for the Wall Street Journal. For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

China Mobile Limited (HKG:941) is about to trade ex-dividend in the next 4 days. If you purchase the stock on or after...

Let's see if China Mobile (Hong Kong) (CHL) stock is a good choice for value-oriented investors right now from multiple angles.

(Bloomberg) -- Facebook Inc. and some of the world’s largest telecom carriers including China Mobile Ltd. are joining forces to build a giant sub-sea cable to help bring more reliable and faster internet across Africa.The cost of the project will be just under $1 billion, according to three people familiar with the project, who asking not to be identified as the budget hasn’t been made public. The 37,000-kilometer (23,000 miles) long cable -- dubbed 2Africa -- will connect Europe to the Middle East and 16 African countries, according to a statement on Thursday.The undersea cable sector is experiencing a resurgence. During the 1990s dot-com boom, phone companies spent more than $20 billion laying fiber-optic lines under the oceans. Now tech giants, led by Facebook and Alphabet Inc.’s Google, are behind about 80% of the recent investment in transatlantic cable, driven by demand for fast-data transfers used for streaming movies to social messaging.Facebook has long tried to lead the race to improve connectivity in Africa in a bid to take advantage of a young population, greater connectivity and the increasing availability and affordability of smartphones. The U.S. social-media giant attempted to launch a satellite in 2016 to beam signal around the continent, but the SpaceX rocket carrying the technology blew up on the launchpad.Google announced its own sub-sea cable connecting Europe to Africa last year, using a route down the west coast.2Africa is expected to come into operation by 2024 and will deliver more than the combined capacity of all sub-sea cables serving Africa, according to the statement. The announcement comes after internet users across more than a dozen sub-Saharan African nations experienced slow service in January after two undersea cables were damaged.Facebook has partnered on the new cable with two of Africa’s biggest wireless carriers, Johannesburg-based MTN Group Ltd. and Telecom Egypt Co. The U.K.’s Vodafone Group Plc and Paris-based Orange SA, which both have a significant presence on the continent, are also involved. Nokia Oyj’s Alcatel Submarine Networks has been appointed to build the cable.The 2Africa cable will be one of the longest in the world, trailing Sea-Me-We 3, which is 39,000 kilometers long and connects 33 countries, according to Submarine Cable Networks.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

(Bloomberg) -- The Federal Communications Commission threatened to bar four telecommunications operators unless they can show they’re independent from the Chinese government, the latest in the agency’s efforts to limit Beijing’s role in U.S. networks.The agency named China Telecom Americas, China Unicom Americas, Pacific Networks and its subsidiary ComNet, and told them to respond within 30 days. The companies need to explain why the agency shouldn’t move to revoke their authorizations, according to the FCC.The action reflects “deep concern” among U.S. government agencies, FCC Chairman Ajit Pai said in an emailed statement.Pai said the companies are vulnerable “to the exploitation, influence, and control of the Chinese Communist Party, given that they are subsidiaries of Chinese state-owned entities. We simply cannot take a risk and hope for the best when it comes to the security of our networks.”The U.S. and China are at odds over a suite of issues such as the spread of the novel coronavirus, trade, and security of telecommunications networks. U.S. officials have moved to bar Chinese equipment maker Huawei Technologies Co. as a security threat, an assertion the company denies.China Telecom “has been operating in good standing in the United States for nearly 20 years,” Ge Yu, a spokesman, said in an email. “We look forward, in the coming weeks, to sharing information with the FCC that speaks to our role as a responsible telecom company.”Emails to China Unicom weren’t immediately returned, and the telephone system at ComNet’s California offices didn’t accept a voicemail. ComNet and Pacific Networks are owned by Citic Group Corp., a Chinese state-owned limited liability company, according to the FCC. An email to Citic’s telecommunications unit wasn’t immediately returned.In an earlier filing by U.S. security agencies, the FCC told China Telecom to respond to concerns the Beijing-based telecommunications provider is a national security threat. China Telecom said it “unequivocally” denied the allegations.The FCC barred China Mobile from the U.S. market last year and said it would review other companies’ record.Senator Tom Cotton, an Arkansas Republican, said he supports the FCC’s action.“No matter their cries to the contrary, these firms are beholden to the Chinese Communist Party, and their operation in the United States will continue to pose a threat to our critical networks as long as it continues,” Cotton said in a news release. “Chairman Pai has rightly identified the magnitude of the Chinese telecom contamination.”(Updates with statement from China Telecom in sixth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.