Some telecoms may close 3G networks before 2G to focus on LTE

Some telecom operators may close down their 3G networks before 2G in a bid to focus on LTE services, said Ovum.

“Ovum believes that in some markets 3G networks may see closure before 2G ones. 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,” said Nicole McCormick, principal analyst of Ovum.

The Ovum report said LTE’s appeal and affordability means operators in developed markets have to refarm GSM or CDMA spectrum to accommodate this demand. The next step is to close down these legacy networks, but determining the sweet spot for network closure is challenging.

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Telecoms will consider key revenue streams such as M2M (machine-to-machine), voice and roaming in the trade-off when determining the optimal time to close the network. The amount of 2G, 3G, and LTE spectrum will also affect timing of the closure.

The Ovum report comes at a time when a few telecom operators in the US and Asia Pacific have announced network closures.
Ovum says the majority of mobile operators are not in a position to close their legacy networks. They will not shut down their legacy networks in the next 1–2 years. Wireless operators are deciding how to best manage a transition towards full network closure.

“We don’t expect networks to be retired en masse until closer to 2020,” McCormick said.

Commercial and cost factors will affect the timing of shutting down the network. These include the cost of migrating residual customers to LTE and the cost of maintaining an ageing legacy network.

Baburajan K
editor@telecomlead.com