PRESS RELEASE: Cloud phone is emerging as a highly promising service in the competitive communications market.

In September 2024, China Unicom launched a publicly available cloud phone service powered by ground-breaking cloud-network synergy technology. By November 6, 2024, the service had gained 10,000 registered users. Just 75 days later, on January 21, 2025, it had grown to over 10,000 daily active users (DAUs) with little reliance on marketing. As of the latest update, the service had expanded to 500,000 registered users and 20,000 DAUs. Built on cloud computing, AI, and 5G technologies, the service hosts mobile phone operating systems (OSs), apps, and data on cloud servers, and allows users to remotely access and use them through the network. By breaking free from storage and computing limitations of physical phones, the cloud phone service offers seamless one-tap cloud access across various scenarios, such as digital life, home entertainment, and business offices.

Why Cloud Phone Is Gaining Popularity

Performance bottlenecks and price considerations: In China, low-end and mid-range mobile phones priced below US$399 account for approximately 64% of the market share, primarily targeting teenagers who are avid mobile gamers. However, these devices have limited computing power, making them unsuitable for triple-A games and graphically-demanding games, such as Genshin Impact, which requires robust hardware to run smoothly.

Growing anxiety about storage capacity: Chinese mobile phone users have on average 70+ apps on their device, which take up increasing amounts of storage space. For instance, Genshin Impact alone requires 7 GB of storage space for initial installation and over 40 GB after use. The price gap between a 512 GB flagship phone and lower-capacity options is around US$100, aggravating capacity concerns for budget-conscious users.

Diverse service needs: Users expect flexibility in selecting and bundling services that meet their unique needs, such as app memberships and data plans that cater to their communications, entertainment, and office requirements. However, typical integrated service packages offered by operators struggle to meet these diverse demands. Furthermore, users require advanced features like app twin, Android app support (for Apple users), and robust privacy protection.

To address these pain points, China Unicom aims to establish a user-centric cloud phone ecosystem that delivers exceptional user experience, with a goal of reaching 10 million monthly active users (MAUs) by 2025.

What Sets the China Unicom Cloud Phone Apart

Comparable to physical phones in experience: China Unicom’s cloud phone supports 2K resolution and 60 frames per second (FPS), matching the user experience of physical devices. With cloud technologies, it upgrades mid-range and low-end mobile phones into high-performance devices with virtually unlimited cloud computing power and storage capacity. For example, Black Myth: Wukong, a triple-A game that has been a global hit since its release last year, is inaccessible to many players due to its high hardware requirements. Fortunately, China Unicom’s cloud gaming package, priced under US$5 per month, lets players embark on Wukong’s journey over cloud phones that harness cloud-based high computing power.

Enriched ecosystem to stimulate user interests: China Unicom has collaborated extensively with leading game and entertainment ecosystem partners to enhance cloud phone compatibility with popular apps. Its cloud phone service now supports China’s top 100 apps, including Taobao, Bilibili, Amap, WPS Office, and NetEase Cloud Music. Moreover, China Unicom has teamed up with iQIYI, Youku, and Thunder on joint membership initiatives since November last year, offering users enhanced, diverse traffic and ecosystem benefits.

China Unicom’s Cloud Phone Strategy

In the 4G era, operators’ services were remarkably similar, with competition revolving around subtle price and package differences. This has led to a lack of distinct advantages. As short video platforms like Douyin and Kuaishou, as well as online gaming and video streaming apps, increasingly dominate data traffic consumption, operators have become mere data transmission channels, generating revenue primarily from traffic fees. Cloud phones, however, offer users a holistic experience, including computing, storage, and ecosystem services delivered through the cloud. This frees operators from low-price traffic competition and paves the way for innovative cloud services.

Emerging foundation models, typified by ChatGPT, are equipped with ecosystem plug-ins and convergence capabilities, making it possible to call services across apps or even eliminate the need for apps. Generally, mainstream mobile phone vendors develop their own AI assistants, which are often closed systems that rely on phone hardware for computing. For instance, Apple’s iPhone 16 Pro features the A18 Pro chip, which costs over US$1,000 and provides 35 trillion operations per second (TOPS) of computing power. In contrast, China Unicom’s network-wide intelligent computing power reached 15 quintillion floating-point operations per second (EFLOPS) in 2024, with 29 computing center campuses and over 600 edge nodes deployed across 31 provinces in China. Its two intelligent computing clusters in Shanghai and Hohhot, each comprising over 10,000 cards, provide on-demand computing and storage for cloud phone users. The cloud phone enhances user loyalty for China Unicom and serves as an entry to public services in the AI era.

Operators’ networks connect a wide range of devices, supporting access to cloud phones via multiple channels, including apps, HTML5 pages, and mini programs, from any device and platform. China Unicom has the world’s largest 5G co-construction and sharing network. The rollout of 5G-Advanced (5G-A) in China enhances dual-carrier networks with additional air interface frequency resources as well as frequency selective scheduling capabilities. This results in approximately 30% lower service latency under heavy network loads, significantly improving gaming experience. In addition, 5G-A 2-component-carrier aggregation (2CC CA) can achieve downlink peak rates of up to 3.2 Gbps, enabling higher-bit-rate video streaming for users. The cloud phone service is driving the deployment of 5G-A networks. Cloud phones consume 1.2 GB of data per hour at 1080p 60 FPS, approximately 2.3 GB per hour at 2K 90 FPS, and are expected to consume 6.6 GB per hour at 4K 120 FPS. As its user base expands, this service will strain network resources, accelerating 5G-A network development in tandem with services.

All-Converged Future Ecosystem

In the future, China Unicom will make cloud phones a pioneering application that integrates with cloud tablets and smart home screens. It will build a unified account authentication platform based on the cloud phone OS to support user registration, login, and identity authentication for cloud phones, cloud tablets, and smart home screens. China Unicom will also introduce multi-device login and synchronization capabilities, allowing the OS background to automatically synchronize user data such as operation records and preferences across devices. What this means is that videos viewed or added to favorites on a cloud phone can be resumed from the last playback position or accessed from the favorites list on a cloud tablet or smart home screen. This marks the convergence of large, medium, and small screens. China Unicom’s strategy is poised to capture AI users and revolutionize communications services, shift its focus from traffic monetization to ecosystem value monetization, and transform the company into a cloud service provider.