As AT&T continues to build out its next-generation 4G network nationwide, it would possibly make sense to divert resources from older infrastructures that are becoming less useful.
Case in point, the nation's second largest wireless provider is doing just that with a roadmap to shut down second-generation (a.k.a. 2G) networks within five years.
AT&T quietly announced the shift towards solely supporting 3G and 4G networks through a Form 10-Q quarterly filing with the U.S. Securities and Exchange Commission on Friday.
Here's a snippet from the SEC filing that explains AT&T's rationale:
Also as part of our ongoing efforts to improve our network performance and help address the need for additional spectrum capacity, we intend to redeploy spectrum currently used for basic 2G services to support more advanced mobile Internet services on our 3G and 4G networks. We will manage this process consistent with previous network upgrades and will transition customers on a market-by-market basis from our Global System for Mobile Communications (GSM) and Enhanced Data rates for GSM Evolution (EDGE) networks (referred to as 2G networks) to our more advanced 3G and 4G networks.
We expect to fully discontinue service on our 2G networks by approximately January 1, 2017.
While AT&T asserted that this transition won't have a financial impact on operating results, AT&T does acknowledge there might be some worries amongst its customers utilizing 2G-based devices.
As of June 30, AT&T said that only 12 percent of postpaid customers were still using 2G mobile devices. Additionally, The Wall Street Journal reports that AT&T doesn't even sell 2G devices to prepaid and contract customers anymore. Thus, a five year plan might just work out for AT&T as more and more consumers make the jump to 4G anyway.
As a way to alleviate worries, AT&T insisted in the SEC report that it will work with customers to manage upgrades to 3G and 4G devices to reduce any risk of losing these customers altogether.