2G is abandoned by many countries, China will have to wait at least another ten years

The GSM network, which has made a monumental contribution to the mobile communications industry, is accelerating its pace of retirement. The list of operators that have officially announced plans to shut down their GSM networks is already long: Singapore's M1, Singtel, StarHub, Telstra, AT&T...

With the rapid popularization of 4G, it is expected that GSM networks will accelerate their withdrawal from the global market. So the question is what will China do? - I think the GSM network will have at least ten years of life in China, and I mean the time when the GSM network will completely withdraw from the service.

According to the ITU's vision, 5G will be commercially available worldwide in 2020. Will China's mobile communications industry really last for four generations? I am also surprised by this judgment, but looking back at history and facing reality, it is not sensational to think that the GSM network can survive in China for at least another ten years.

There are two main reasons why foreign operators shut down GSM networks. One is that the maintenance cost of the network is seriously out of line with the revenue, and it is no longer necessary to maintain the existence of this network. For example, Telstra said in 2014 that GSM accounted for less than 1% of all traffic. The other is to make way for 4G networks and free up spectrum for 4G. It should be noted that foreign operators have to pay huge spectrum fees to the government every year.

Therefore, enterprises in the market economy still mainly consider economic interests, so foreign operators will mostly formulate GSM network decommissioning plans based on their own circumstances.

However, this does not mean that cost-effectiveness considerations are applicable to China's national conditions. Moreover, even if it is only for economic benefits, Chinese operators are unlikely to make a big move in the matter of GSM withdrawal. Let's look at some data to illustrate this point:

As of April 2015, the number of 2G users was 649 million; as of March 2015, the total number of base stations in China was 3.539 million, of which the total number of 3G/4G base stations reached 2.273 million, which means that there were 1.266 million 2G base stations.

With such huge assets and users, putting the delisting of GSM on the agenda seems like a fantasy story, no matter for operators or users.

This can also be seen from the requirements of China Unicom and China Telecom for multi-mode in their terminal strategies in the 4G era. In other words, for China Mobile and China Unicom, as long as there are enough 2G users, they can maintain economies of scale in terms of economic benefits and do not need to worry about network decommissioning.

Of course, history is a lesson for the future. If we have a brief understanding of the history of the decommissioning of China's PHS service, perhaps we can more clearly understand why the decommissioning of the GSM network is not an easy task.

Xiaolingtong officially left the stage of history in China in 2014. In that year, China Telecom and China Unicom in various regions successively announced the termination of Xiaolingtong services: Beijing Unicom announced that it would terminate Xiaolingtong services on December 31, 2014.

Theoretically, according to the requirements of the Ministry of Industry and Information Technology at that time, the two major operators, China Telecom and China Unicom, needed to complete the frequency clearance and network withdrawal of Xiaolingtong users by the end of 2011. This requirement was put forward when the 3G licenses were issued in 2009 in order to make way for TD-SCDMA, the 3G standard produced in China.

In other words, the government gave Xiaolingtong a three-year grace period before it was delisted, but it was only seven years later that it was officially delisted. The last statistical data from the Ministry of Industry and Information Technology in January 2014 showed that there were still 7.37 million Xiaolingtong users.

Compared with PHS, the decommissioning of GSM is obviously a more complex system engineering, which involves the following issues:

1) GSM spectrum allocation in the 4G era

2) Issues with Issuing the Third FDD License

3) The issue of maximizing the interests of state-owned capital

4) Issues regarding user interest protection and service quality complaint assessment

5) The problem of balanced market competition among the three major operators

6) Issues regarding the development of supporting services in the industry chain

In short, the delisting of GSM in China is by no means a simple matter of rational corporate decision-making in a market economy, so before the relevant government departments have officially started discussions, the delisting of GSM will not be put on the operators' agenda.

Of course, if the EU, GSM's home base, speeds up the process of decommissioning GSM networks, I believe China's process may also be accelerated. However, no matter how fast it is, GSM still has at least a ten-year life cycle in China.

With the accelerated popularization of 4G and the advent of 5G, China's mobile communications will present a grand and spectacular scene of four generations living under the same roof.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.