Analysts Ovum predict 2G and 3G spectrum will be refarmed by 2020
Mobile operators will be forced to redistribute 2G and 3G spectrum as demand for 4G grows, with legacy networks set to disappear within five years, according to Ovum.
A report from the analyst firm found that the majority of operators will not be in a strong enough position with their 4G rollout to begin closing 2G and 3G networks for “1-2 years”.
As demand for LTE grows, and new services such as machine-to-machine require more connectivity, operators need to determine the “sweet spot” for network closures, according to Ovum principle analyst Nicole McCormick.
“For operators in transition, there are key revenues – M2M, voice and roaming – that need to be considered in the trade-off when determining the optimal time to close the network,” she explained.
“The majority of operators are not in a position today to close their legacy networks. Rather, operators are deciding how to best manage a transition towards full network closure, given that M2M, voice, and roaming revenue cannibalization remains a pertinent issue. We don’t expect networks to be retired en masse until closer to 2020.”
In August 2012, US operator AT&T announced plans to switch off its 2G network by the end of 2017, whilst Australian carrier Telstra set out similar plans last year.
McCormick predicted that some markets will see 3G networks closed before 2G networks due to the cost and complication of migrating people off the latter.
She added: “2G is still an important source of revenue. LTE provides a better mobile broadband experience than 3G, and with VoLTE, LTE can handle the voice responsibilities of 3G. This points to the possibility that operators opt to close their 3G networks before they close 2G.”