Digital connectivity

China’s commercial space sector is heavily funded by state capital, with private capital playing a supporting role. For example, about 82 percent of shares in the company that operates SpaceSail, one of China’s satellite internet megaconstellations in Low Earth Orbit, are held by state investors, with the rest belonging to private shareholders. Core segments such as satellite manufacturing and ground systems are largely state-funded. Rockets, component manufacturing, remote sensing, and navigation services increasingly rely on the private sector for funding.

Satellites depend on ground stations to manage and control satellites and facilitate communication. China has expanded this infrastructure in recent years. On the ground, it hosts five rocket launch centers, three sea-based launch sites, two aerospace and satellite control centers in Beijing and Xi’an, and at least ten tracking, telemetry, and control (TT&C) stations. The country is also trying to build ground stations beyond its borders.

In 2016, various domestic units formed a committee with one mission: Systematically replacing foreign technology from China’s IT systems, starting with government and military infrastructure and later moving to state-owned enterprises. The campaign that unfolded, known as “xinchuang” (信创, loosely translated as IT innovation) has nurtured domestic champions not only in hardware sectors, but also in software segments like databases, cloud services and operating systems.