AT&T begins cannibalizing its 2G and 3G networks to boost LTE capacity

Verizon(s vz)(s vod), Sprint(s s) and T-Mobile(s tmus) are all turbo-charging their 4G networks, but AT&T won’t be left out of the party. It’s begun building a new LTE network in the PCS band, the swath of digital communications spectrum where carriers have traditionally run their 2G voice and 3G data services.

AT&T PCS LTE screenshotGigaom’s favorite mobile signal spotter Milan Milanovic spied AT&T’s new network in his NYC stomping grounds last week (Milanovic caught the first glimpse of Verizon’s massive new LTE network in NYC as well). As Milanovic’s screenshot shows, AT&T has a 5 MHz-by-5 MHz network running in the 1900 MHz PCS band — band 2 is PCS — which previously contained only HSPA and GSM signals. Commercial devices are already connecting to the network.

AT&T actually revealed its plans to cannibalize — or as they say in industry speak, refarm — portions of its networks for LTE in an August FCC filing related to Ma Bell’s planned acquisition of Leap Wireless(s leap). AT&T SVP of Network Planning and Engineering William Hogg wrote that AT&T was in the process of deploying LTE in PCS and would launch the service commercially in Baltimore, Dallas, New York City, Philadelphia, San Francisco and Washington, D.C., by the end of this year.

But AT&T began laying the groundwork for this move well over a year ago. In March of 2012, AT&T started culling all 2G-only PCS phones from its New York networks in order to make way for a shutdown of GSM in the PCS band. At the time, AT&T said it would repurpose that GSM spectrum for its 3G and 4G networks, which was a bit confusing since AT&T calls its HSPA+ service 4G. But it’s now obvious it had LTE intentions for the band as well.

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In September of 2012, FCC documentation revealed two hidden bands on AT&T’s version of the iPhone 5 that didn’t appear in Apple’s(s aapl) official spec sheet: PCS and cellular. At the time, no GSM operator had plans to deploy LTE in either band. Apple included them probably because AT&T asked it to.

Since then PCS and cellular support have been showing up in a lot of devices, including the current generation of iPhones and iPads, the latest Galaxy phones and tablets and the new Google(s goog) Nexus 5. The end result: as these new PCS LTE networks go live some of AT&T’s most popular phones will automatically connect to them — even phones from a generation back. It also means that AT&T almost certainly has plans to repurpose some of its 850 MHz cellular spectrum for LTE as well.

Unlike Verizon’s forthcoming 4G monster, Sprint’s planned Spark network and T-Mobile’s recent doubling of LTE bandwidth; AT&T’s new PCS LTE network won’t boost the speeds of its current networks. The 10 MHz configuration AT&T is using is only half the size of the 20 MHz network its already running in the 700 MHz band, which means it will support only half the theoretical speed. But I doubt AT&T is too worried.

AT&T's network coverage with LTE markets marked in black

AT&T’s network coverage with LTE markets marked in black

The new network will give AT&T a significant boost in overall LTE capacity. Between the two networks, AT&T will be able to support a lot more connections and maintain its current speeds even as its network grows more crowded. AT&T already holds the LTE bandwidth crown; this new network will help it keep that crown longer — at least until the other carriers’ new souped-up 4G systems come online.

As AT&T continues to connect more customers to LTE devices, its HSPA networks will less use. Then it can start adding that freed-up bandwidth to the 10 MHz it’s already using.  We’re also going to see a lot more 2G and 3G cannibalization in the coming years. T-Mobile was the first, shutting down most of its GSM network capacity to make room for LTE. Then came Sprint, which canned its old Nextel network so it could use its spectrum for Spark. Verizon has said it will start replacing CDMA with LTE in 2015.

2G and 3G networks will stick around for a while. Even as phones all migrate to LTE, the old networks will be needed in rural areas and to support machine-to-machine communications. But as carriers migrate their voice and SMS services to IP and the vast majority of traffic flows to LTE, those old networks will become scarcer and scarcer.

NYC image courtesy of Flickr user Joey Parsons