The layout of the three major operators is "Counting East and Counting in the West" to open a new track of competition

Reporter Li Qiaoyu and trainee reporter Xu Linyan

Boosted by the news of the official launch of the "East Number West Calculation" project, on February 21, the concept of computing power in the A-share market and the data center sector staged a rising and stopping tide. However, "the bustle is theirs", compared with the hilarity of the concept stock of "East Number West Calculation", the three major telecom operators that are also involved in the data center business and provide the network foundation for "East Number West Calculation" have performed flat in the secondary market.

On February 21, China Mobile's A-shares opened high, and the intraday continued to oscillate at a high level, reaching a close of 63.53 yuan / share, a slight increase of 1.16%. In the same period, China Unicom opened low and went high, as of the close of 3.97 yuan / share, a slight increase of 0.25%; China Telecom reported closing at 4.19 yuan / share, down 1.64%.

"The three major operators have large plates, so the volatility is limited, and in addition, the revenue generated by the IDC business accounts for a relatively small proportion of the total revenue of operators." Fu Liang, an analyst in the communication industry, told the Securities Daily reporter, "But in the long run, with the gradual tilt of the policy, the three major operators are expected to get more business increments, and the integration of IDC services and other self-owned services of operators is also expected to bring new market space." ”

Actively grab the beach "count the east and count the west"

In fact, the three major operators have all laid out in the field of "East Counting and West Counting". In January this year, the first phase of China Mobile (Guangxi) data center project was completed and put into operation. It is understood that the center is divided into two phases of construction, with a total investment of 2.5 billion yuan, can accommodate 15,000 racks, 225,000 servers, and will provide new momentum for building a digital Silk Road facing ASEAN. In addition, Guangxi Mobile has built 30 data centers in the whole region, covering 14 districted cities.

Liu Guiqing, deputy general manager of China Telecom Group Co., Ltd., said that China Telecom is the largest number, most widely distributed and the largest IDC service provider in China, with 794 data centers and 500,000 racks. China Telecom has clearly defined the layout of "2+4+31+X", of which 2 refer to inner Mongolia and Guizhou data center parks in inner Mongolia and Guizhou, which are positioned as bases for national data storage backup and offline analysis; 4 are the layout of the four hubs of Beijing-Tianjin-Hebei, Yangtze River Delta, Guangdong-Hong Kong-Macao Greater Bay Area and Chengdu-Chongqing, positioning it as the carrier of high-frequency video playback and e-commerce in hot spots; 31+X is for 31 provinces (autonomous regions, including the two hubs of Gansu and Ningxia. Municipality) and the layout of X key cities, focusing on ultra-low latency, large bandwidth, and massive connectivity services such as internet of vehicles, autonomous driving, drones, industrial Internet, and AR\VR.

According to Liu Guiqing, at present, China Telecom has 400,000 data center racks in the 2+4 region, accounting for 80% of all data centers in China Telecom, and in the next step, China Telecom will further accelerate the land acquisition and construction work in the eight major hub nodes, and it is expected that the proportion will reach 85% at the end of the "14th Five-Year Plan". At the same time, the ratio of east and west will be further optimized, from the current 7:3 to 6:4 at the end of the "14th Five-Year Plan".

The relevant person in charge of China Unicom told the Securities Daily reporter that China Unicom accelerated the new construction and expansion of new data centers in the four major countries of Beijing-Tianjin-Hebei, Yangtze River Delta, Guangdong-Hong Kong-Macao Greater Bay Area and Chengdu-Chongqing Region to meet the implementation needs of major national regional development strategies.

At the same time, we will give full play to the advantages of natural resources such as energy and climate, build the four major national western computing hub nodes in Menggui, Ganning, and Ningxia, improve the quality and utilization efficiency of computing power services, and create a non-real-time computing power guarantee base for the whole country.

"China Unicom is actively declaring and building relevant projects, and striving to set a benchmark for the effective implementation of the national 'East Counting West' project." The person in charge of China Unicom said.

Fu Liang told the "Securities Daily" reporter that the western region has a large temperature difference and small energy consumption, low electricity costs, and has unique geographical advantages. Therefore, "counting the east and counting the west" can be regarded as the result of the joint promotion of the industry. In the future, the western region is expected to usher in more policy inclinations, establish a better industrial environment, or have more data storage and cloud computing needs converge in the western region.

Data center operating costs are expected to fall

"East counting and west counting" is expected to bring benefits to the three major operators at the performance level.

Liu Guiqing said that the construction of a national integrated big data center system will effectively make up for the shortage of resources in the east, and at the same time will fully revitalize the resources in the west and reduce operating costs. "Energy consumption in data centers has always been high. Taking China Telecom as an example, data center power consumption will reach 5.6 billion kWh in 2021, accounting for 20% of total electricity consumption. The layout of the integrated big data center requires efficient coordination of the energy grid and the computing power network, which will reduce operating costs to a certain extent. ”

Huang Han, co-chief analyst of Guosheng Securities Communications, told the Securities Daily reporter that the "East Number West Calculation" to promote the expansion of new data centers will have a positive contribution to the overall revenue of operators, and at the same time will have a very obvious pull on the entire network traffic end. In addition, the initial stage of "East Counting West Calculation" may be carried out in the form of cooperation between local governments and operators, and operators will be deeply involved and fully benefited.

"We expect emerging services to account for an average share of operators' revenues by more than 30 percent in the future." Huang Han said that under the background of the overall digital transformation of operators, the proportion of emerging services such as cloud computing and Internet of Things will further increase. "'Counting East and Counting West' is a good place to stay."

In the view of Wang Zhengnan, a senior observer of the telecom operator industry, "counting the east and counting the west" means the beginning of a new round of communication infrastructure, which is a major benefit to the communication field. "At the same time, behind the optimization and upgrading of computing power is new technology applications, iteration of new scenarios, and the industry empowered by operator cloud numbers will be more extensive."

It is worth noting that the adjustment of the revenue structure of the three major operators will be a long-term process. "In the short term, traditional businesses will still contribute the vast majority of revenue to the three major operators, and the revenue pattern will not change for at least a year or two." Wang Zhengnan said.

In his view, the layout of the three major operators "counting the east and counting the west" has more important significance. "With the gradual improvement of infrastructure, in the next three to five years, around the digital communication industry, the surrounding areas may establish a new industrial chain, thereby driving the overall economic development of the western region."