Browse Definitions :
Definition

sunsetting

What is sunsetting?

Sunsetting is the intentional phasing out or termination of something, and in business, the term is used often regarding brands, partnerships, agreements, policies, and hardware and software.

How is sunsetting used in business?

Sunsetting something may be part of the original plan. In a legal context, for example, a sunset provision is a specification that legislation will no longer be in effect beyond a certain date or after a particular event has transpired, unless an extension is mandated.

However, it could also occur because of unplanned circumstances, for example, when a company is acquired and the new owner sunsets an old product line. If two companies with similar product lines merge, one of the lines could be discontinued.

In most cases, products and services are often sunsetted when they are no longer sufficiently profitable or when a company changes its focus. Software vendors usually sunset older versions of their products when a newer version is available. Or sunsetting can occur when a new technology replaces an older one. One example is the shift from 3G networking to 4G and then 5G. Another example is the transition to newer Windows operating systems (OSes), such as Windows 11. When this type of transition occurs, the earlier product or technology is no longer supported.

2g and 3g cellular network sunset dates
The shift from 3G networking to 4G and then 5G led to the sunsetting of 2G and 3G cellular networks.

A legacy application, such as an older browser, may still work. However, it may be unstable because of compatibility issues with current OSes, browsers and IT infrastructures.

Common reasons for sunsetting

Sunsetting might take place for the following reasons:

  • Obsolescence. The item is no longer relevant or useful.
  • Financial considerations. It's no longer cost-effective to maintain or support the item.
  • Legal. The item violates current laws or regulations.
  • Lack of resources. The company no longer has the resources or materials to keep it going.
  • Change in strategy. The company's overarching goal has shifted, making the item no longer a priority.

Examples of sunsetting

The following are common examples of sunsetting in business:

  • ending a business partnership;
  • canceling a project;
  • discontinuing a product line;
  • ending support for an older version of a software product;
  • eliminating a company policy; and
  • closing a physical location.
obsolescence chart
Software vendors usually sunset older versions of their applications when newer versions become available and the older versions are obsolete.

When is sunsetting the right move for a business?

There's no easy answer to this question. Sunsetting decisions must be made on a case-by-case basis, considering all the relevant factors. Nevertheless, sunsetting is usually the right move in the following scenarios:

  • The item in question is no longer profitable.
  • The item is no longer aligned with the company's goals.
  • The resources required to maintain the item are no longer available.
types of business goals
Changes in business goals often lead to the sunsetting of products and services.

Challenges in sunsetting an offering

The process of sunsetting a product, service or another business offering can be complex. It may involve legal, financial and emotional challenges.

There may be customers who are loyal to the item being sunsetted and who need to be transitioned to a new solution. Also, some employees may be attached to the item and need help finding new roles within the company. Finally, there may be environmental concerns if the sunsetting results in increased waste.

Overall, it's important to sunset responsibly and thoughtfully to keep negative impacts to a minimum.

evolutions of Microsoft Windows OS
The evolution of Windows has led Microsoft to sunset and no longer support earlier versions of the OS with the release of new iterations over the years.

Tips for sunsetting an offering

Sunsetting can be difficult but necessary for businesses. Here are some tips to help businesses sunset responsibly and thoughtfully:

  1. Communicate early and often. When customers and employees are affected, the decision can be difficult for businesses, as it may mean disappointing customers or losing employees. It's important to communicate sunset change management plans as early as possible so that those involved can be prepared and alternative solutions found.
  2. Have a plan. A sunsetting plan should be in place well in advance. This plan should include how the sunsetting takes place, what happens to customers and employees, and what the financial impacts are.
  3. Be transparent. Be honest about why the sunsetting is taking place. If it's due to financial considerations, let people know. If it's because of a change in strategy, explain the new direction the company is taking. This helps build trust with employees and customers.
  4. Follow through. Once the sunsetting process is underway, it's important to follow through on all aspects of the plan. This helps avoid surprises and keep disruptions to a minimum.
  5. Learn from mistakes. No matter how well a sunsetting plan is executed, there will probably be some bumps along the way. It's important to learn from these mistakes so that they can be avoided in the future.

See also: deprecation and product lifecycle management.

This was last updated in October 2022

Continue Reading About sunsetting

Networking
  • network management system

    A network management system, or NMS, is an application or set of applications that lets network engineers manage a network's ...

  • host (in computing)

    A host is a computer or other device that communicates with other hosts on a network.

  • Network as a Service (NaaS)

    Network as a service, or NaaS, is a business model for delivering enterprise WAN services virtually on a subscription basis.

Security
  • WebAuthn API

    The Web Authentication API (WebAuthn API) is a credential management application program interface (API) that lets web ...

  • Common Vulnerability Scoring System (CVSS)

    The Common Vulnerability Scoring System (CVSS) is a public framework for rating the severity of security vulnerabilities in ...

  • Dridex malware

    Dridex is a form of malware that targets victims' banking information, with the main goal of stealing online account credentials ...

CIO
  • audit program (audit plan)

    An audit program, also called an audit plan, is an action plan that documents what procedures an auditor will follow to validate ...

  • blockchain decentralization

    Decentralization is the distribution of functions, control and information instead of being centralized in a single entity.

  • outsourcing

    Outsourcing is a business practice in which a company hires a third party to perform tasks, handle operations or provide services...

HRSoftware
  • team collaboration

    Team collaboration is a communication and project management approach that emphasizes teamwork, innovative thinking and equal ...

  • employee self-service (ESS)

    Employee self-service (ESS) is a widely used human resources technology that enables employees to perform many job-related ...

  • learning experience platform (LXP)

    A learning experience platform (LXP) is an AI-driven peer learning experience platform delivered using software as a service (...

Customer Experience
  • market segmentation

    Market segmentation is a marketing strategy that uses well-defined criteria to divide a brand's total addressable market share ...

  • sales pipeline

    A sales pipeline is a visual representation of sales prospects and where they are in the purchasing process.

  • market basket analysis

    Market basket analysis is a data mining technique used by retailers to increase sales by better understanding customer purchasing...

Close