The Future of GSM – Is 2G Wireless Technology Being Phased Out?

December 31, 2014 Pekka Keskiivari

Pekka KeskiivariI note that the discussion regarding the future of 2G networks has been initiated by a few machine-to-machine providers who seek to use claims of an impending phase-out against their competitors deploying GSM-only equipment.  There are currently no published plans or announcements from any wireless carrier regarding phase-out of their 2G networks, and this lack of any published plans creates an opportunity to present such claims.

There is naturally an on-going evolution of networks, and eventually any technology will become out-dated.  To analyze the future of 2G, we should try to understand the drivers for wireless carriers in the development of their networks.  Essentially, their decisions are based on the relevant regulative framework and business case. Wireless radio spectrum is typically licensed for a fixed term and for specific use, determining which wireless technology can be used to operate on the licensed frequency band. While it is difficult to predict how the license landscape will change over time in each country, the periods tend to be fairly long, and it is not reasonable for the regulator to make abrupt changes that would severely affect how the carriers can utilize their massive investments in network infrastructure.  Carriers will not phase out a technology that is generating them a profit if they don't have to, and if it does not make business sense to them.

Let's look at why and when a network operator would want to phase out a given network technology.  There are technical concerns regarding the use of different wireless technologies on the same frequency bands, and traditionally large chunks of the wireless radio spectrum have been dedicated to a given technology (like GSM, WCDMA etc).  Also, as can easily be seen from the specifications of handsets, support for each technology/frequency band set needs to be built into the radio design on the phone.  Consequently, there have been strict and established standards for which technology to use on which frequency band.

With the development of wireless technology it has recently become more viable to be flexible in the assignment of technologies.  A concept of "refarming" frequencies has been introduced and is also increasingly endorsed by regulators. In refarming, frequencies previously allocated to one technology, like 2G GSM, are reused using a new technology, usually with the goal of providing more capacity to high speed mobile broadband services. Overall, the rationale for this process is highly dependent on both the frequency bands held by the carrier, the customer needs and the business case.  As parts of the old frequency band are being refarmed, this first results in a drop in capacity (how many simultaneous users are supported), and only impacts coverage (how good and comprehensive the service is) once the process goes so far that complete bands are overtaken by the new technology.  The carriers will obviously control the process in such a way that their existing subscriber base is not adversely affected.

When assessing the possible effects of 2G refarming, it should be noted that the new technologies like LTE are really not supported by many handsets yet.  Each operator has a unique selection of licenses, frequencies and technologies that they need to leverage.  They need to support their existing customers, so switching to a new technology that their customers' phones cannot use is not a viable option.  For example, a carrier may have licenses for 850 and 1900 Mhz used by GSM, and a WCDMA license for 1700 MHz, but even the newest phones may not support WCDMA on this band, and will so rely on 2G to operate in this carrier's network.  The carriers need to plan their possible refarming upgrades carefully to match the evolution of technology standards and handsets in order to minimize the negative impact on their existing subscriber base, at the same time maximizing the total return on their investments.  In some countries like Finland where operator subsidies have not been commonplace, there is even less carrier control over the handsets used by the subscribers, and a significant portion of users are still using old 2G-only phones.  To conclude, the machine-to-machine market that was mentioned in the beginning is largely static with slow turnover of technology. This all means there is a large existing base of devices in the current networks requiring continuing support of the traditional 2G service.

Mobile broadband services will continue to grow in popularity and carriers will need more radio spectrum in order to support the growth of these services.  However, refarming of existing frequency bands is not the only alternative since new frequency bands are also being allocated.  For instance, part of the radio spectrum previously used by analogue TV is going to be reallocated to wireless broadband (so called ‘digital dividend’).  It can be estimated that refarming will probably have an effect on availability of 2G services in the next ten years.  Nevertheless, any wireless carrier that will engage in this process will provide a graceful migration to the new technologies and is likely to make announcements in plenty of time before they see it will affect the existing GSM subscriber base.  Until these announcements, partial refarming of the 2G frequencies may cause some decrease in the capacity of GSM-based packet data services, but this will have minimal or no effect on ePRO data collection due to the relatively low data bandwidth needed for collection of data from the eDiaries.

 

Best Regards,
Pekka Keskiivari
CTO, CRF Health

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