There is an incredibly complicated challenge facing the Machine-to-Machine (M2M) industry. In August 2012, AT&T declared that they prepare to shut down 2G GSM solutions (including GPRS & EDGE packet-data) by Jan. 1, 2017 in a little over four years from the date of the news.
This sunset demands substituting an estimated 10 to 14 Million GSM devices on AT&T's network before the services are removed-- and the deadline is now just over three years away!
Some companies have begun dealing with this sunset replacement prerequisite, but far too many have yet to resolve this issue meaningfully.
With the Machine-to-Machine industry facing this tough target date, there simply isn't any time to waste.
Companies using AT&T's 2G GSM services must act now-- to rapidly establish and completely carry out a multi-year plan to replace programs and reduce interruption for their customers.
AT&T also ceased provisioning new Subscriber Identity Modules ("SIM") for existing, certified, 2G GSM devices and applications.
This means that customers can not deploy Anymore 2G GSM devices into their existing Machine-to-Machine applications installed base.
AT&T services for Machine-to-Machine in a serious financial bind-- the cost of replacement (for devices, logistics, installation services, "truck rolls", etc.) is expensive.
When North American service providers initially deployed digital cellular, they chose technologies with incompatible coding and data protocols.
Some carriers chose CDMA cellular and others picked GSM3 cellular after first deploying ANSI-136 TDMA1.
For simplicity, these are called the "CDMA carriers" and the "GSM carriers".
As a result, companies deployed electronic cellular Machine-to-Machine products and applications using two packet-data services: 2G CDMA 1xRTT and 2G GSM GPRS.
The automotive and trucking industries chose CDMA for the higher data throughput and easy roaming into Analog AMPS in rural market areas, since ANSI-95 CDMA radios fully supported AMPS mode.
More significantly, automobile design and production cycles drove criteria for service longevity, for which CDMA was the best choice.
However, CDMA radios were two to 2.5 times more costly than GSM radios. Cost-conscious industries, such as the residential and commercial alarm/security businesses, chose 2G GSM GPRS, since the far lower cost of radios was just too eye-catching to neglect.
The simpler technology of the GSM protocol, combined with the scale and volume of GSM device sales in International markets, dropped radio prices rapidly.
Recently, carriers have seen large increases in the number of smartphones and a dramatic rise in packet data use.
This has forced them to acquire spectrum to add capacity.
And deploy more spectrum-efficient protocols in existing spectrum to improve capacity.
Because of the higher spectrum efficiency of the CDMA packet-data protocols, the CDMA carriers were under less business stress than the GSM carriers.
They had time to deploy 3G EV-DO, which co-existed with 2G 1xRTT in the same spectrum bands and allowed handset customers an easier migration path to faster performance.
The CDMA carriers deployed 3G EV-DO in their entire coverage footprint quite rapidly, but the GSM carriers have yet to complete their 3G deployment into many markets where they have deployed 2G GSM.
Over the past years, standard transmission of mobile data has boosted dramatically and is not slowing down.
Not surprisingly, the largest growth is from smartphones, laptops and tablets.
Consumers want more and more data for their mobile devices and applications, and they want it faster and faster.
Carriers must provide for this dramatic growth in wireless mobile traffic.
As smartphone deployment and usage increased carriers needed to deploy even more spectrum efficient protocols, such as OFDMA (as used in WiMAX and LTE).
Since they had fully established their 3G networks, the CDMA carriers began deployment of WiMAX and LTE sooner than the GSM carriers who continued their 3G expansion in.
For 4G deployments, carriers have been using new spectrum to avoid disrupting 2G/3G services.
However, AT&T is in a weak spectrum position, in many markets. Thus, in 2011, AT&T attempted to purchase T-Mobile to acquire additional AWS spectrum licenses at 1700/2100MHz for their LTE deployment.
During negotiations, AT&T's VP Jean Marsh wrote what might happen if the acquisition was not approved: First, AT&T would promptly shut down its 2G GSM network, a network that currently supports tens of millions of devices that customer base would be required to go purchase new mobile broadband (UMTS) handsets, which are generally more expensive.."
As we know, AT&T did not receive approval for the T-Mobile acquisition. Of the top U.S. carriers, AT&T is in the weakest position for spectrum ownership.
Cellular Devices for Top Carriers in US, it must support nearly as many cellular devices like Verizon with good throughput, coverage and service quality-- to retain its customer base.
The recent T-Mobile merger with MetroPCS creates a stronger number-four carrier, with good spectrum holdings, that can compete effectively with AT&T using 3G HSPA+ and 4G LTE.
Indeed, its spectrum ownership allows it to support its 2G GSM/GPRS network for a few more years than AT&T, since it has fewer customers using that spectrum.
Since T-Mobile is also actively selling the latest smartphones using the latest 3G and 4G cellular technologies, it can gain significant market share from AT&T now that the acquisition of MetroPCS is complete-- indeed, the latest reports show that T-Mobile is adding customers faster than the other carriers.
AT&T needs to re-use its existing spectrum at 850MHz and 1900 MHz for 3G and 4G technology deployments.
The mixture of data growth, competitive tension from other carriers, and the cost of adding new spectrum has driven this sunset judgment.
Nonetheless of the resulting trouble faced by the Machine-to-Machine industry as a whole, their decision to remove 2G GSM service was not taken lightly.
The GSM sunset is a major issue for the M2M industry because such large numbers of GSM/GPRS devices have been positioned.
To maintain service, an estimated 10 to 12 million 2G GSM devices must be replaced in just over three years.
Assuming 200 working days a year, the Machine-to-Machine industry must replace more than 17,000 devices per day, starting immediately.
To complete this, companies must instantly develop and execute thorough plans, including new products from suppliers, detailed schedules, customer notifications, installer training as needed, recall plans, etc.
Device suppliers are making new 3G HSPA devices. However, the HSPA coverage footprint is much smaller than GPRS and, in time, the HSPA service in many markets will also be swapped for LTE.
Thus, there is likely to be an eventual "3G HSPA Sunset" in about seven to eight years.
This sunset would be even worse, since the number of deployed units will be much increased.
As in all technology fields, we must expect change more often, and Machine-to-Machine application providers must expect and plan for cellular technology changes and shorter product life cycles.
Since Machine-to-Machine devices usually operate for many years-- unlike consumer handsets and smartphones mechanisms to accommodate these changes are important.
For example, in the alarm and security industry, device developers need to make a radio technology modification as easy as a battery change by using a plug-in adapter or sled for the radio in the alarm system instruments.
This could enable residential and business owners to update their tools relatively effortlessly and minimize pricey truck rolls.
Lastly, if any company with 2G GSM/GPRS machines has not yet begun changing units, must they start as soon as attainable.
The AT&T 2G GSM Sunset is simply too close now to prolong motion any further.