The 2G era will not come to an abrupt end; network transformation requires the support of the Internet of Things

Recently, China Unicom announced that it will carry out a comprehensive upgrade of its 2G network. In fact, since the end of last year, news about Unicom taking the lead in "shutting down" the 2G network has been circulating in various channels. With the full maturity of 4G and the development of 5G, it is an inevitable trend that the 2G era will completely leave us. However, upgrading the 2G network is not a matter of overnight, and the challenges that must be overcome may be more than imagined.

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China Unicom adjusts 2G network

Recently, China Unicom issued an announcement stating that it will transform and upgrade the existing 2G network in the near future.

It is reported that at the beginning of this year, China Unicom has already started to actively deploy 2G network adjustments in many provinces and cities, and required the market line to strictly prohibit the development of 2G business. At present, Unicom's 2G customers account for about 2% of the total number of customers. At the end of last year, the number of Unicom users reached 280 million, and the current number of 2G customers is about 5 million.

In response, the outside world believed that China Unicom would shut down the 2G network, causing users to be unable to make calls. However, in response to this, a relevant person in charge of China Unicom told reporters that it cannot be called shutting down the 2G network, but rather that the 2G bandwidth resources should be freed up for the higher-level 4G network and deployment.

In recent years, the number of 2G users has gradually decreased, while the growth rate of 4G traffic has been rapid, and the frequency resources of 4G are obviously insufficient. Under such circumstances, China Unicom will also promote the migration of 2G users to 3G and 4G through a number of preferential and subsidy measures such as preferential purchase of mobile phones and free replacement of mobile phone cards.

Low-cost Internet packages urgently need resource support

The adjustment and upgrade of the 2G network has driven users to make changes, and the reason behind this is the popularity of 4G Internet packages.

Last year, China Unicom, China Telecom and China Mobile successively launched "unlimited" data packages. This year, some provincial and municipal operators have further launched "unlimited" data packages priced below RMB 100, playing the low-price card to attract users.

For example, Beijing Mobile recently launched an "unlimited" data package with a promotional price of 98 yuan/month, while China Unicom launched the "Ice God Card" series of Internet packages. The 99 yuan small Ice God Card has a monthly fee of 99 yuan, unlimited domestic data and includes 300 minutes of domestic voice calls; Beijing Telecom's Tianyi "unlimited" is launched at a limited-time promotional price of 99 yuan/month, and an additional 30 yuan of phone bills will be given every month in the first year of the limited-time promotion.

This year, my country will cancel data "roaming" fees, and as major operators push Internet packages such as "unlimited" data, support for 3G and 4G networks has also posed greater challenges.

Currently, China Unicom has a relatively small number of base stations among the three major operators, and it has been committed to developing Internet packages and using traffic to attract more users in the past two years. From this perspective, China Unicom's network support may face the greatest challenges.

In this regard, communications expert Xiang Ligang said that the vast majority of consumers will not be affected, and the 2G frequency of China Unicom has been vacated, which will have a positive impact on the wide coverage and quality assurance of China Unicom's 4G network.

2G transformation and upgrading is not a one-shot process

Obviously, the "extinction" of 2G is a trend, but it is not a simple matter. It is not a "one size fits all" approach where users lose their right to use the service.

At present, many foreign operators have shut down their 2G networks. Between 2009 and 2012, Japan's NTT-DoCoMo, KDDI, Finnish operators, New Zealand Telecom and South Korea's KT have successively announced the suspension of 2G services.

Based on the existing experience, it takes a long time to upgrade 2G. For example, AT&T started to migrate 2G network users one year before officially shutting down the 2G network, offering discounts for users to switch to 3G or 4G phones. Before officially shutting down the 2G network, Telstra said that the company had contacted those users who were still using the 2G network and would provide free upgrade services. If customers want to buy a new phone, the company also has new phones for as low as 29 Australian dollars.

China Unicom has a time advantage in spectrum refarming

2G occupies high-quality spectrum such as 900MHz and 1800MHz. The withdrawal of 2G network can not only avoid operators from operating multiple networks and multiple frequencies, streamline the network, re-cultivate frequencies, reduce costs and increase efficiency, but also re-cultivate the vacated spectrum for 4G and 5G deployment.

However, in terms of re-cultivation time, China Unicom has a certain advantage. On April 3, 2018, China Mobile was issued an FDD license. However, the Ministry of Industry and Information Technology has not yet issued a notice to allow China Mobile to re-cultivate 2G frequencies for 4G network construction. For China Mobile, the 2G decommissioned frequencies can only be used for the Internet of Things, not data services, and the spectrum re-cultivation policy has not been completely relaxed.

This means that even if China Mobile transforms its 2G network, it cannot use it for 4G data services.

IoT support is a key issue

The transformation of 2G networks affects not only data services in the consumer market, but also the Internet of Things support in the enterprise market.

Last year, the Ministry of Industry and Information Technology issued a document allowing operators to deploy NB-IoT systems on the GSM frequency band. Subsequently, China Mobile built a 4G-based narrowband IoT network on the original 2G frequency band.

However, given that narrowband IoT networks are still in their early stages of development, the reality is that, currently, most IoT support is based on 2G networks.

"A 2G module may cost only more than 10 yuan, but a 4G module is several times more expensive." Taking POS machines as an example, most of them still rely on the support of 2G networks.

At present, China Mobile alone has 230 million IoT devices, all based on 2G networks. Unlike data services, IoT services are not that sensitive to speed. At present, when narrowband IoT is still in its early stages of development, the high maturity and high cost-effectiveness of 2G networks are still the best support for IoT.

At the same time, IoT devices have a long design life cycle, and because they are deeply rooted in the enterprise market, the frequency of upgrades and renovations is much lower than that of the consumer market. These factors determine that 2G network transformation still faces the greatest challenges.