DeepSeek ignites the market for the three major telecom operators

Author | Huang Yu

Editor | Zhou Zhiyu

Riding the wave of DeepSeek's explosive growth, China's three major telecom operators have also ushered in a new round of bullish market trends.

On February 10, the stock prices of China Telecom, China Unicom, and China Mobile opened high collectively, with China Telecom hitting the daily limit and reaching a historic high. China Unicom saw a maximum increase of over 7.8%, while China Mobile rose nearly 4.6% at its peak.

By the close of trading that day, China Telecom, China Unicom, and China Mobile had increased by 6.59%, 4.4%, and 1.72%, respectively.

In terms of news, on February 8, the Bureau of Operation Monitoring and Coordination of the Ministry of Industry and Information Technology mentioned in its report on the communication services for the 2025 Spring Festival that all three major telecom operators have fully integrated with the DeepSeek open-source large model, enabling applications across multiple scenarios and products. They are providing exclusive computing power solutions and supporting environments for the popular DeepSeek-R1 model, aiding in the performance release of domestic large models.

Investors generally believe that the three major telecom operators have unique advantages in data resources and network infrastructure, and are expected to explore new business growth points through deep integration with AI technologies like DeepSeek, thereby enhancing the company's profitability and market value, which is directly reflected in the rise in stock prices.

Recently, DeepSeek has gained significant attention, and its success has made the entire AI industry chain highly favored. As telecom operators are closely related to digital information transmission and data center resources, they are naturally expected to perform well in the market.

It is reported that China Telecom has taken the lead in completing the deep adaptation and optimization of domestic computing power with the DeepSeek-R1/V3 series large models through its self-developed "Xirang" intelligent computing platform on Tianyi Cloud, becoming the first operator-level cloud platform in China to realize the full-stack domestic inference service of DeepSeek.

China Mobile's Mobile Cloud has deeply integrated the DeepSeek model, achieving "full version coverage, full size adaptation, and full function usage," and provides flexible deployment relying on 13 intelligent computing centers across the country. Users can choose any intelligent computing resource pool for deployment, distillation, intelligent agent orchestration, and other operations.

Unicom Cloud has also achieved multi-specification adaptation of the domestic and mainstream computing power for the DeepSeek-R1 model based on the Xingluo platform, accommodating both privatized and public scenarios, and can be pre-deployed in over 270 backbone cloud pools nationwide, fully integrating with Unicom Cloud Desktop, programming assistants, and other product scenarios.

The cooperation between the three major telecom operators and DeepSeek represents not only a deep technical adaptation but also an exploration of innovative business models.

In the AI industrial revolution, the role of telecom operators is being redefined, transitioning from computing power infrastructure to scenario implementation, from cost optimization to ecological co-construction. Driven by DeepSeek, the three major telecom operators will accelerate their transformation from traditional communication pipeline providers to "intelligent service ecosystem builders." As the growth rate of traditional communication services slows to single digits, the transformation to AI has become a critical question for survival, and the three major telecom operators are standing at the critical point of value reassessment.

CITIC Securities research report states that China Telecom, China Unicom, and China Mobile have all announced full access to DeepSeek. The three operators have achieved extensive application of DeepSeek across multiple scenarios and products through their respective platforms and resources, which is expected to accelerate the growth of the operators' cloud computing revenue.

Huatai Securities pointed out that under the leadership of DeepSeek, the depth and breadth of AI application promotion in China are expected to be further strengthened, leading to a more prosperous application side and driving strong growth in traffic and inference demand. The three major telecom operators are expected to benefit from the "network + cloud + end" in three aspects.

Firstly, AI applications drive the growth of traffic demand, and network traffic business is expected to regain growth potential; secondly, the three operators hold leading positions in the domestic cloud and data center industry, and these two businesses are expected to see dual improvements in growth and profitability; in addition, AI is expanding connections from "person to person" to "thing to thing."

In recent years, the three major telecom operators have actively promoted digital transformation strategies, increasing investments in 5G network construction, cloud computing, big data, and other fields, building a solid digital foundation, and have become major players in the domestic cloud computing market.

For example, China Mobile is vigorously building the "Jiutian" artificial intelligence platform, China Unicom has launched "Unicom Cloud," and China Telecom continues to optimize its Tianyi Cloud layout. These initiatives not only enhance the operators' operational efficiency but also lay the foundation for their participation in AI ecosystem construction.

According to IDC statistics, in the first half of 2024, the market shares of China Telecom and China Mobile in the domestic public cloud IaaS field are expected to reach 13% and 9%, ranking third and fourth respectively.

In addition, the operators are also a core force in promoting the development of domestic computing power. Tianfeng Securities stated that from January to June 2024, in the bidding events related to intelligent computing centers, operator bids accounted for 55.8% of the total number of bids, occupying a significant share.

According to the plans of the three major telecom operators, it is expected that a total of 31.6 EFlops of intelligent computing capacity will be built throughout 2024, representing a year-on-year growth of 107%. Among them, China Mobile is expected to build 6.9 EFlops, China Unicom 14.7 EFlops, and China Telecom 10 EFlops.

Huatai Securities analysts believe that after the release of DeepSeek, the depth and breadth of AI application promotion have further strengthened, driving strong growth in traffic and inference demand. Against this backdrop, the vacancy rate of domestic existing data centers is expected to decline further, and prices are expected to warm up, benefiting the data center businesses of the three major operators.

QuestMobile data shows that on January 28, DeepSeek's daily active users first surpassed ByteDance's Douyin, and then on February 1, it broke through the 30 million mark, becoming the fastest application to achieve this milestone in history.

2025 will be a year of accelerated explosion of AI applications, and the market demand for computing power will continue to rise. For the three major operators, seizing the historical opportunity brought by the AI revolution is not only related to whether they can open up the imagination space of the capital market but also determines whether they can grasp the discourse power in the AI era