VIEWPOINT

2024

M I G R AT I N G T O T H E
NEX T NET WORK
How telecom operators can accelerate
customer migration to advanced
networks

The telecom industry is evolving rapidly,
simultaneously witnessing the rise of new, advanced
network transitions while current technology

AUTHORS
Gonzalo Garcia
Marc Palacios
Guillem Casahuga

becomes obsolete. This Viewpoint explores how

Gregory Pankert

mobile telecom operators can effectively implement

Sean McDevittcustomer migration acceleration programs to optimize
operations, migrate customers to advanced networks,
and unlock new opportunities in a future-readytelecom landscape.

Vincenzo Basile

ARTHUR D. LITTLE

VIEWPOINT

CURRENT S TATUS & TRENDS

A CONFLUENCEO F FA C T O R S H A S
CONTRIBUTED TO
A D I G I TA L D I V I D E

In the evolving landscape of technologicaladvancement, traditional mobile infrastructure— namely 2G and 3G networks — is becoming
increasingly obsolete. These networks are being
systematically phased out across various global
regions (see Figure 1). However, the pace of thisHowever, this narrative is changing. The telecom

transformation is not uniform. While developed

industry in these regions is gradually awakening

nations have rapidly transitioned to moreto the opportunities presented by more advanced

advanced networks, regions such as Africa andnetworks like 5G. Operators, governments, andthe Middle East still have considerable groundinternational organizations are collaborating

to cover in the journey to sunset outdated

to invest in infrastructure, build supportive

technology.

regulatory frameworks, and raise awareness

A confluence of factors, including economic

among consumers about the benefits ofdisparities, infrastructure limitations, andimplementing newer technologies.

regulatory challenges, has contributed to this

Nevertheless, the path toward sunset

digital divide. In many African countries, foracceleration is long and complex. It requires

instance, 2G and 3G networks continue to forma carefully orchestrated approach that not

the backbone of mobile connectivity, due to their

only focuses on technology upgrades but also

wide coverage and the affordability of compatible

considers the socioeconomic realities of eachdevices. In parts of the Middle East, similar strides

unique market. This includes ensuring affordable

have been made toward adopting 4G and even 5G

access to advanced services, developing digitalin urban areas, while rural and remote areas often

skills among the population, and supporting local

remain reliant on 2G and 3G networks due tobusinesses in leveraging these technologies.

infrastructural and economic constraints.

Figure 1. Legacy mobile networks in the technology mix

Figure 1. Legacy mobile networks in the technology mix
100
80
60

17%
26%

23%

40
20
0

42%

50%

16%

57%
35%
Sub-SaharanAfrica

MENA

34%
CIS

62%

9%
29%

66%

79%

18%
16%

15%

Latin America Asia-Pacific
Other technologies

2G

Europe

91%

6%
6%

98%

3%

North America

1%

1%
China

3G

Base: Percentage of total mobile connections
Source: Arthur D. Little, GSMAMIGRATING TO THE NEXT NETWORK

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ARTHUR D. LITTLE

VIEWPOINT

As we navigate this transformative era

Most crucially, operators need to manage thein telecommunications, the frequency of

impact of the new technology on their customers.

communicated shutdowns of networks isThis involves communicating the changes toescalating (see Figure 2). Operators worldwide

them clearly and proactively, offering support

are increasingly acknowledging the need toas they shift to new services, and addressing any

optimize their network operations and drive

service disruptions or customer concerns thatcost efficiencies. And yet, while the intention toarise during the process. This customer-centric

expedite the sunset of outdated infrastructure

approach is vital in maintaining customer trustis gaining momentum, the timeline for thisand satisfaction and in seizing the opportunity

monumental shift remains protracted.

to upgrade customers to higher-value plans
and services.

This extended timeline reflects the complexity of
shutting down mobile networks and transitioning

While the number of communicated shutdowns

to advanced infrastructures. While the benefits

is rising, the journey toward a modern telecom

are clear — enhanced network performance, costlandscape remains a marathon, not a sprint. It

reductions, improved customer experience, and thenecessitates a strategic, methodical approach

potential for new services and revenue streams —that balances the ambition to accelerate

the process itself is multifaceted and challenging.

progress with the need to manage complexity

Operators must manage multiple interdependentand customer impact. As operators continue tofactors, including technical, regulatory,

navigate this path, their success will be definedand customer-related elements. Technicalnot only by the pace of change, but also byconsiderations encompass the need to ensure

their ability to maintain network quality, satisfy

network stability and the quality of service during

customers, and unlock new opportunities in thethe transition, while simultaneously deploying andprocess.

scaling up newer technologies. Operators also needto comply with regulatory requirements regarding
service continuity and customer communications,which often requires negotiation with authorities

Figure 2. Announced
2G
and 3G network sunsets
to align on shutdown
timelines.

Figure 2. Announced 2G and 3G network sunsets
3G

37

42

44

2G

46

27

5
22
’15

’16

’17

9
26
’18

9

10
49

30
’19

53

56

56 61

33

’20

’21

’22

’23

’24

’25

COUNTRYOPERATORSERVICE

CLOSURE

Finland

Telia

3G

Dec '23

Japan

SoftBank

3G

Jan '24

Australia

Telstra2G

Jun '24

India

BSNL

3G

Dec '24

Austria

A1

3G

Dec '25

Bulgaria

A1

3G

Dec '25

FranceOrange2G

Dec '25

Ireland

Vodafone2G

Dec '25

Italy

Vodafone2G

Dec '25

LatviaTele2 SIA

2G

Dec '25

Netherlands

Vodafone2G

Dec '25

Portugal

Vodafone2G

Dec '25

Spain

Telefonica

3G

Dec '25

SwedenTelenor

3G

Dec '25

Japan

NTT DOCOMO

3G

Mar '26

UK

Vodafone2G

Dec '26

FranceOrange3G

Dec '28

BelgiumOrange2G

Dec '30

Source: Arthur D. Little, GSMAMIGRATING
TOD.
THE
NEXTGSMANETWORK
Source:Arthur
Little,3

ARTHUR D. LITTLE

VIEWPOINTCUS TOMER MIGR ATIONACCELER ATIONPROGR AM BENEFIT S

A WELL- E XECUTEDC U S T O M E R M I G R AT I O N
A C C E L E R AT I O N P R O G R A M
P U T S O P E R AT O R S I N A
POSITION TO THRIVE IN
T H E S W I F T LY C H A N G I N G
TELECOM INDUSTRY

A customer migration acceleration program
strategically phases out the use of legacy
networks and expedites advanced technology
adoption. It can serve as a significant catalyst
for a telecom network operator, ushering intransformative operational, financial, andcustomer-centric benefits (see Figure 3). By

Incorporating energy efficiency into new

hastening the process of closing old networks

networks as part of the transition process

to make room for newer technologies, operators

highlights the operator’s commitment to

can reduce the burdensome maintenance costs
that accompany outdated systems. The resulting
financial efficiency allows for the reallocation

well-executed customer migration acceleration

infrastructure, thereby enhancing network
performance and opening doors for cutting-edge
services.
Furthermore, advanced networks offer a superior
lower latency, and increased reliability, which

responsible steward in a world increasingly
conscious of environmental impacts. Thus, aof resources toward innovative, advanceduser experience: improved connectivity speed,

sustainability, reinforcing its position as aprogram puts operators in a position to thrivein the swiftly changing telecom industry,paving the way for operational excellence, costsavings, elevated customer experiences, andenvironmental stewardship.

strengthens customer satisfaction and loyalty.

Figure 3. Opportunities and benefits of customer migration
acceleration program
Figure 3. Opportunities and benefits of customer migration acceleration program
PRE-SUNSET PERIOD

Existing B2C network customers have a muchhigher churn rate (revenue leakage) with no
incentives to migrate their service

CHALLENGES

Existing B2B & government network customers
might have strong contractual commitments for
specific usage of carrier technology
Complexity of extended product portfolio& customer management

OPPORTUNITIESPOST-SUNSET PERIODHigh customer migration costs(e.g., communications, incentives, handsets)

Highly complex & expensive process with numerous
contractual commitments with third parties (e.g.,service providers, vendors, TowerCo, spectrum leases)

Avoid B2C customer churn by having theright migration program & incentives

Capture network cost efficiencies (CAPEX/OPEX);
reduce sunset-related process costs (e.g., logistics,
contractual impacts)

Accelerate migration of B2B customers,
improve quality & eliminate dependencies

Free up spectrum derived from dedicatedold service operations

Simplify customer service operations &maintenance (more relevant for B2B segment)

Optimize space onsite for future network deployment

Source: Arthur D. Little

MIGRATING TO THE NEXT NETWORK

Source: Arthur D. Little

4

ARTHUR D. LITTLE

VIEWPOINTCUS TOMER MIGR ATION
PL AYBO OK
A customer migration “playbook” offers a concise
approach to facilitating customer migration andpath toward the intended goal. The roadmap
should outline timelines, milestones, risk
management strategies, and contingency plans.
3. Run migrations and shutdown. This
stage helps manage expectations andexpediting the switch to new technologies. First, amaintain customer trust during transition. A

thorough planning stage establishes the roadmap,

comprehensive customer migration programbalancing technical, financial, and customer

offers customers an affordable, accessible

considerations. Next, a proactive communications

option for maintaining service. Efforts focus on

strategy ensures customers are well-informed,

avoiding customer complaints and surpassing

supported, and encouraged to transition to

expectations. Stakeholder communication

advanced services. Finally, executing the shutdown

should be consistent and transparent andinvolves meticulous management to ensure service
continuity and to address any emerging customer
concerns. As Figure 4 illustrates, a playbook can

include customers, employees, and partners.
4. Collect and analyze network data. This
process includes logical and physical network

provide operators with a structured, customer-

inventory and analysis.

centric blueprint to navigate the complex journey offuture network customer migration acceleration as
technology evolves:

5. Select vendor and execute decommissioning
plan. This stage involves shutting down oldsystems and integrating new technologies. It’s

1. Define strategy. This initial stage involves

best to complete this task in phases to minimize

assessing customer impacts and potential

service disruptions.

risks. Conducting a careful audit of existing
infrastructure and customer bases, scrutinizing
efficiency and costs, and identifying potential

6. Monitor and optimize. Once new systems
are operational, they will require continuous

risk and opportunity will offer guidance formonitoring and optimization to ensure

subsequent stages.

delivery of anticipated benefits. Unforeseen
issues are identified and addressed, and

2. Prepare migration operating model. A

processes are refined for improve efficiency.

detailed sunset roadmap based on knowledge

gained during theassessment provides
a clearFigure 4. Customer
migrationandnetwork shutdown
playbook
Figure 4. Customer migration and network shutdown playbook
Assess customer impacts &potential risks & define strategy

Prepare migration
operating model

Run migrations & shutdown

Customer segmentation& characterization

01

New service plan requirements

01

PMO migration operating model

02 Migration service alternatives

02

Migration & suspension goal setting
per geography/segment

02

Monitor results & capture benefits

03

PMO suspension waves

Promotional migration incentives

04

Approach regulatory & consumer
authorities

IT requirements to execute service

05

Approach business segment &ensure one-on-one communication

01

Subscriber forecast & financial
impacts (revenue & OPEX)

03 Migration operating model

04 authorities’ risks

Regulatory & consumer public

04 for customers

05 Migration & sunset rollout plan

05 plan migration or suspension

03

Select vendor & execute
decommissioning plan

Collect & analyze network data
01

Logical & physical network inventory& analysis

01

RFQ/vendor selection &decommissioning plan development

Monitor & optimize
01

PMO execution

Source: Arthur D. Little

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ARTHUR D. LITTLE

VIEWPOINT- Economic impacts. The broader economic

VALUE EQUATION OF
CUS TOMER MIGR ATIONACCELER ATION

environment influences the timing decision.
For instance, operators might defer thetransition during a downturn due to budget

As we dissect the mechanics of moving fromold networks to advanced infrastructure in
the telecom industry, a fundamental element
emerges: the value equation of the transition
process. The crux of this equation revolves aroundthe net present value (NPV) of the program.
In the context of a network transition, NPV isdetermined by the current technological cost, thepotential for customer loss, the opportunity cost,and additional factors. However, the time variable
increases the complexity of the value equation.
Timing is integral to the success of thechangeover. Specifically, optimizing NPV relies on
deciding when to initiate and when to complete
the transition. If an operator decreases theinitiation period by a year and compresses therest of the process by several months, NPV could
potentially increase significantly. However,determining the optimal timing for the transition

constraints or uncertain ROI.

- Regulatory considerations. The telecom

industry is heavily regulated; any significant
infrastructure change often requires regulatory
approval, which can complicate timing.

- Transition process constraints. Revamping
projects can be time-consuming, requiring
substantial planning, implementation, andtesting. Accelerating this process too rapidly
could risk the quality of the transition andjeopardize network reliability and customer
satisfaction.
Given these complexities, a well-devised holistic
customer migration acceleration program
becomes pivotal in overcoming these limitations
and optimizing the NPV of the process. Sucha program could entail strategic negotiation
with suppliers for flexible contracts, robust

is a complex puzzle involving several factors:

communications strategies to minimize customer- Supplier and customer obligations. Telecom

quality, and active engagement with regulators tooperators often have existing contracts withequipment suppliers and service agreements

churn, phased transition plans to maintain service
expedite approvals (see Figure 5).

with customers that need to be honored.

Figure 5. Estimated financial outcomes from four legacy
financial penalties and reputational damage.
networks’ customer migration programs
Violating these obligations could lead to

Figure 5. Estimated financial outcomes from four legacy networks’ customer migration
programs
PROGRAMDESCRIPTION(TIME/CUSTOMERS)

Global telco:
Mobilenetwork 1•~5% total customers•

10 months to complete
process & sunset network

Global telco:
Mobilenetwork 2•~1% total customers••

5 months to complete
process & sunset network

Average 4.5 months
payback for migration•

Global telco:
Mobilenetwork 3•~2% total customers

Savings from network
sunset•7 months to complete
process & sunset network•

Zero formal claims
with official consumer
authorities

Global telco:
Mobilenetwork 4•~2% total customers•

5 months to complete
process & sunset platform•~25% total customers•

5 months to complete
process

Leading
pay-TV (DTH)
providerBENEFITS•

Churn reduction throughmigration efforts:–•+20-30% active
customers retained

Churn reduction throughmigration efforts:–+30% active customers
retained

ANNUALSAVINGS

INCREMENTAL
ANNUALREVENUETOTAL GROSSBENEFIT(EBITDA)~1% of OPEX

+1%

+2 p.p.

~1% of OPEX

+1%

+3 p.p.

~0.5% of OPEX

+0.5%

+2 p.p.

~0.5% of OPEX

+0.2%

+1 p.p.

~1% of OPEX

+0.5%

+2 p.p.

Source: Arthur D. Little

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ARTHUR D. LITTLE

VIEWPOINT

The changeover from outdated networks
to advanced infrastructure is not just atechnological shift; it’s a comprehensive
strategic process that requires meticulous
planning and execution. By understanding and

EFFECTIVE
C O M M U N I C AT I O N C A N
MAKE OR BREAK THE
M I G R AT I O N P L A N

optimizing the value equation of the process,telecom operators can navigate the complex
puzzle of transition timing and strike a balance

A clear picture of the customer base can facilitate

between technological advancement, customer

scheduling and prioritizing the migration, withsatisfaction, and financial viability. If theyfactors such as readiness for change, network

succeed, they will unlock substantial value

load impact, and business considerations

and firmly position themselves in the telecom

driving the decisions. The segmentation andindustry of the future.

characterization exercise should culminate in thecreation of unique offers for each customer group.

THE CUS TOMERMIGR ATION JOURNE Y

Crafting personalized incentives to motivate early

As telecommunication technology evolves from

customers all potentially add value.

traditional to cutting-edge, crafting a thoroughcustomer migration strategy and steering it
successfully is key. Ideally, the shift to advanced
systems should be as intuitive and frictionlessas possible for customers.

transition, bundling new features with packages,
and/or designing loyalty programs for longtime

However, a migration strategy requires clear
forecasts of the customer base post-migration.
These predictions feed into planning network
capacity, allocating resources, and financial
forecasting. This brings us to a critical part

Knowledge of the customer base forms theof the strategy: understanding the financial

bedrock of a successful migration strategy; each

impacts. This relies on having a clear-eyed view

customer is unique and thus demands a differentof the direct costs, the effect of customer churn,approach. Organizing the customer base into

and the potential revenue uplift from the new

manageable groups based on demographics,

services now possible thanks to the advanced

usage behaviors, and preferences offers key

systems. While the migration strategy forms

insights that can shape a more targeted

the blueprint, the execution brings it to life.

migration plan.

The cornerstone is setting up effective tools

But segmentation is just the first step. Detailed
characterization helps to truly understand eachcustomer group. This involves delving deepand channels to facilitate migration, including
customer self-service portals that provide accessto dedicated customer support teams.

into their specific needs, how they perceive thetransition, and most importantly, how ready they
are to embrace advances in telecommunications.

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ARTHUR D. LITTLE

VIEWPOINTP R E PA R I N G F O R T H E
FUTURE IS NOT JUSTA B O U T H AV I N G T H E
M O S T T E C H N O L O G I C A L LY
A D VA N C E D T E L E C O M
SYSTEMS

Closely monitoring progress is critical to themigration process. This involves tracking thenumber of successfully migrated customers, therate of customer churn, and customer satisfaction
scores. Studying these metrics can help measuresuccess against planned milestones and identify
any potential issues; the strategy can be tweaked
as needed.
Preparing for the future is not just about having

Effective communication can make or break thethe most technologically advanced telecom

migration plan. Customers need to be aware ofsystems; it is about ensuring a seamless,every aspect of the migration — what it entails,

customer-centric transition, one that does

how it will benefit them, and most importantly,

not disrupt the customer experience but rather

the potential for service interruptions. Thisenhances it, opening new avenues for service

communication plan should evolve based on

improvement and revenue generation.

customer feedback and changing behaviors(see Figure 6).

Figure 6. One customer’s journey
Figure 6. One customer’s journey

DIEGO PARDO PRODUCT #/SERVICE #/SEGMENT #CONTACTINTRODUCTIONHOME OFFER

Call center call

Sellerpresentation

Introductorymigration
offer

Call inReason for
call

Product
description

Result of the interaction: The migration is completed
NEGOTIATION WITH CLIENT

1st argument

Description of
migration offer

2nd argument

New features
explained

Ask differenceswith current
product/service
1

Customerreceives call

2 Executive provides

introduction,
explains reason
for call

3 Executive gives

brief explanationof new product/
service

Lack of clarity

Script adjusted &informational mail sent

Price of $XX
is shared

OrderplacedNEXT STEPS

Concretemigration

Confirm
deliveryaddress

Deliveryaddress
confirmed

Price inquiry

Orderconfirmed

4 Executive describes

6 Executive

8 Executive indicates

10 Executive confirms delivery

5 Client asks about

7 Customer asks

9 Customer likes

11 Executive closes call &new product as acomplement tocurrent service

differences withcurrent equipment

Quickpresentation

3rd argument

CLOSING

Clarified provided

describes more
new productfeaturesabout cost of
new productprice of $XX/month& offers freeshipping
product & asks
for itOffers full
price first

address & other data

puts order in system

Generate
post-call order

2nd productnot offered
Customer

Agent

Source: Arthur D. Little

Source: Arthur D. Little

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ARTHUR D. LITTLE

VIEWPOINT

FUTURE- RE ADY
TELECOM L ANDSCAPE
The transition to advanced infrastructure holds
the promise of a future-ready telecom landscape,which gives operators the ability to adapt,

A D O P T I O N O F A DVA N C E D ,E N E R GY- E F F I C I E N T
NET WORKS WILL
ENHANCE THE SECTOR’SS U S TA I N A B I L I T Y P R O F I L E

innovate, and offer unique services. Executing
a program that uses a systematic, wave-likestructure of migrations and suspensions
minimizes disruptions and facilitates adequate
support, ensuring a seamless and customercentric process (see Figure 7). This customeroriented approach is designed to maintain
service and may even enhance user experiencethroughout the shift.

Furthermore, telecom operators can significantly
reduce their operating costs and environmental
footprint by phasing out power-hungry, spaceconsuming old systems. The adoption ofadvanced, energy-efficient networks will enhance
the sector’s sustainability profile, aligning it withbroader global goals for carbon reduction andsustainable development.

Figure 7. Customer-oriented migration program actions

Figure 7. Customer-oriented migration program actions

High-value
customers

Customerloyalty

Focus efforts
on high-value
customers byoffering bestphone options& home delivery

Compensate
customerloyalty withbonus to buy
new phone& maintainbalance& tenure

Fixed
telephonecustomers

Customers
withcontracts

Inaccessible
physicalstoresCustomers
with nocoverage

Solutions forenterprisecustomers

Unusualhandset
needs

Offer
customers
devices tomeet financial
needs (e.g.,
refurbishedphones)

Focus efforts
on customers
withincontract
terms byoffering bestphone options& no penalties
for cancelling

Develop homedelivery forcustomers
whose closest
store is morethan 2 hours
away or are
unable to visit
storesInstall cell on
wheels (CoWs)
to ensurenetwork
coverage &replacecustomerhandsetswith freesmartphones

Create special
solutions forenterprisecustomers to
support theiroperations &transition to a
new service

Developcapabilities
to provide
differentiatedhandsets toclients
operating inspecialenvironments

Source: Arthur D. Little

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ARTHUR D. LITTLE

VIEWPOINT

CONCLUSIONE M B R AC IN G DAW N O F
A NEW TELECOM ERA

T H I S S H I F T U N L O C K S A W O R L D T H AT B R I M S
WITH OPPORTUNITIES, MINIMIZES BOUNDARIES,AND MA XIMIZES POTENTIAL

The transition to advanced infrastructures like 5G has ushered in atransformative era. Future success hinges on three pivotal components:
1

Advanced infrastructure — upgrading to sophisticated networks
that support innovative services

2

Agile business models — adapting swiftly to market dynamics,
emphasizing innovation and being receptive to feedback

3

Customer-centric approach — personalizing offerings, employing
analytics, and ensuring superior experiences

This shift unlocks a world that brims with opportunities, minimizes
boundaries, and maximizes potential. The telecom sector is poised for
unprecedented growth that melds innovation and efficiency, and theindustry must gear up for this bright horizon. While the journey might
be long, the destination — a future where everyone, irrespective ofgeography, can access and benefit from advanced telecommunications— is worth the effort. The challenge in these regions offers an
opportunity to leapfrog traditional development pathways to build
a more inclusive, connected, and prosperous digital future.

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ARTHUR D. LITTLE

VIEWPOINTNOTESMIGRATING TO THE NEXT NETWORK

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