Investment Rating - The report maintains a "Recommended" investment rating for the communication industry [1] Core Insights - The 2025 World Mobile Communication Conference (MWC) focused on key themes such as 5G integration, AI, and satellite communication, highlighting significant advancements in the industry [15][49] - The communication sector has shown resilience, outperforming major indices like the CSI 300 and the ChiNext Index in both weekly and year-to-date performance [8][9] - Key companies to watch include China Mobile, China Telecom, and China Unicom, with specific recommendations for various segments such as AI applications, satellite communication, and optical components [49][51] Summary by Sections Industry Overview - The communication industry consists of 124 listed companies with a total market capitalization of approximately 484.33 billion [3] - The sector's performance has been robust, with a 1.58% increase in the past week, outperforming the CSI 300 by 2.04 percentage points [8][9] MWC Highlights - Major announcements included the release of the "Agentic AI for Telco" white paper by China Mobile and several partners, outlining a framework for AI collaboration in telecommunications [15][16] - China Mobile introduced a series of AIoT products, emphasizing the integration of AI with IoT and satellite communications [21][22] - China Telecom showcased its cloud-network integration strategy, focusing on AI-driven applications across various sectors [25][27] Investment Recommendations - Recommended companies include: - Telecom Operators: China Mobile, China Telecom, China Unicom [51] - Optical Components: New Yisheng, Tianfu Communication, Zhongji Xuchuang [51] - Satellite Communication: Haige Communication, Shanghai Hanhua, Qiyi Er [51] - Equipment Manufacturers: Gongjin Co., Unisoc, ZTE, Ruijie Networks [51] - IoT Modules: Guanghetong, with a focus on AI applications [51]

Group 1 - The communication industry is undergoing a critical transformation, with 5G requiring differentiation and platformization for commercial growth, while AI is driving networks towards programmability and intelligence [1] - Ericsson's executives discussed 5G differentiated services, programmable networks, AI integration, and 6G planning during the "Imagine Live" event in Beijing [1] Group 2 - 5G differentiated services provide revenue growth opportunities for operators, shifting from uniform "best-effort" services to tailored connectivity for various applications and user needs [2] - The enterprise market requires more predictable and reliable connections to support critical business applications, while the consumer market faces challenges due to limited willingness to pay [2] - Ericsson's solutions include performance-based differentiated services like network slicing, AI-driven wireless access solutions, and standardization of APIs to lower development barriers [2] Group 3 - To address low consumer willingness to pay, Ericsson suggests tiered package designs, offering basic, video call, and low-latency gaming packages, as well as bundling high-value scenarios like AR glasses [3] Group 4 - The integration of AI and networks enhances operational efficiency and intent recognition, with over 85% of Ericsson's wireless network functions capable of intent-driven service demand recognition [4] - AI supports low-latency connections for edge and endpoint computing scenarios, facilitating data interaction for devices like mobile AI assistants and AR glasses [4] - Collaborations with companies like Toyota, NVIDIA, and Google aim to advance AI and 5G network integration for applications such as cloud rendering and autonomous driving [4] Group 5 - The development of 6G is focused on incorporating differentiated connectivity capabilities, with AI deeply integrated for self-optimizing intent recognition and dynamic resource allocation [4]