Opportunity and Uncertainty
Big opportunities in small markets across North America. Australia embraces cdmaOne as analog networks give way to digital. And the hunt goes on for 3G harmony.
Now that cdmaOne has made its mark in North America's largest
metropolitan markets, manufacturers are stepping in to help
carriers build a business case for expansion into smaller
suburban and rural areas.
Samsung Telecommunications America and Tecore Inc. are among vendors seeking to exploit this opening. The two have joined to offer a modular solution for small PCS operators entering second-tier markets. The Samsung-Tecore partnership integrates Samsung's Pico Base Transceiver Station - the PicoBTS - and Tecore's AirCore Platform MSC and transmission system.
The modular cdmaOne solution competes economically with infrastructure equipment for other air interfaces and could help sway small PCS licensees to make cdmaOne their technological choice, says John Kavulich, Samsung's senior product manager of wireless systems.
Such a decision is being aided by the fact that, overall, costs for cdmaOne base stations have fallen, allowing them to compete price-wise with base stations for TDMA and GSM communications networks. Paul Sergeant, senior manager of product marketing for CDMA wireless networks at Nortel Networks, says this price decrease is due to economies of scale as well as technological advances. He agrees that the cost parity is helping CDMA expansion. "We've been able to help rural operators justify putting in CDMA," he adds.
Casey Joseph, Tecore's chief technical officer, claims that "carriers have been buying into more capacity than needed" because only large, centralized switching systems were available for cdmaOne networks. Joseph says Tecore's AirCore scaleable switching system can be cost-effective with as few as 500 subscribers and can handle up to 100,000 subscribers. Joseph notes that using scaleable solutions lets smaller operators affiliate with brand-name carriers like a Sprint PCS but continue to "operate their own systems and control their own destiny."
For its part, Nortel touts scalability and modularity at
the base station level, with its Mini Cells and higher-capacity
Metro Cells sharing common components that allow a network
to be quickly reconfigured in line with changing usage patterns.
Sergeant notes that while coverage may be a rural carrier's
first concern, the network must be able to add capacity once
corporate services and fixed applications grow in popularity.
Nortel also sold a DMS-100 to Utah-based UBTA Communications,
which has about 4,000 customers. UBTA will use the switch
for wireline telephone traffic as well as 800 MHz analog and
Time Division Multiple Access networks and a cdmaOne 1900
MHz network operated by its wireless subsidiary, Uintah Basin
Electronic Telecommunication (UBTA).
While these cost-effective cdmaOne technologies may be getting
their starts in U.S. markets, they could have global futures.
The Samsung-Tecore solution "was developed for the U.S.
as a way to reduce costs in line with falling ARPU (average
revenue per subscriber,)" Kavulich says. But he notes
that Samsung is taking the product to South Korea, showing
that there is an international business case for scaleable
cdmaOne technology, he says.
Australia's digital decision
Australia's Telstra has announced that a new national cdmaOne mobile network will replace its old analog (AMPS) network which at present serves more than 1.5 million users.
Telstra's group managing director, products and marketing, Mr. Lindsay Yelland, said Telstra's decision to build the new network would particularly benefit rural mobile users.
"Telstra plans to commercially launch CDMA in mid-1999 in Melbourne, Sydney, Perth, Adelaide and Brisbane. This will be followed by a rapid introduction commencing the second half of 1999 into regional locations covered by the current analog network.
To smooth the transition from analog to digital, Telstra
has successfully negotiated with other mobile operators Optus
and Vodafone, along with the government, a strategy for the
phase-out of the analog network that will ensure continued
mobile phone service and coverage in rural areas.
Telstra will determine the 130 non-metropolitan sites in conjunction with the rollout plan for its new CDMA network and finalize the sites by the end of 1998.
Of the 270 analog sites remaining open after the end of 1999, at least 50 per cent will close on June 30, 2000, and the remaining sites on or before December 31, 2000.
"Telstra's CDMA network rollout will be completed prior
to the final closure of the analog network ensuring customers
can retain continuity of service during the period of the
analog network closure," Mr Yelland said.
Telstra has chosen Nortel Networks Australia as its vendor to provide the infrastructure for the rollout of its CDMA network.
The hunt for harmony
Efforts to harmonize the approach to a third generation mobile technology based on CDMA are continuing. In late September, the CDMA Development Group (CDG) submitted a letter to 21 key U.S. government officials, stressing the importance of harmonization for third generation (3G) mobile technologies.
The letter, signed by members of the CDG executive board,
detailed the benefits of harmonizing the two leading third
generation proposals. It pointed out, said Perry LaForge,
executive director of the CDG, that "the presence of
multiple second generation technologies was a key driver of
growth and competition in the U.S. wireless market, and the
significant differences between CDMA, GSM and TDMA still provide
an important basis for competitive differentiation. In contrast,
W-CDMA and CDMA2000 are nearly identical and will provide
little or no basis for competitive differentiation".
This is not to imply that all 3G difficulties have been resolved.
Certainly, the perceived lack of flexibility on the part of
W-CDMA proponents has brought a strong response from cdmaOne
Qualcomm supports achieving a single, converged standard for all proposed 3G CDMA technologies submitted to the ITU as candidates for IMT-2000 and is willing to license its IPRs only on fair, reasonable and non-discriminatory terms for standards that meet a specific set of criteria. These are based on three 'fairness principles' which support convergence of all proposed 3G CDMA technologies.
The ITU will not complete the process of evaluating and selecting submitted proposals unless all essential IPR holders for those proposals either waive all rights to their IPR or commit to license their IPR on a non-discriminatory basis on reasonable terms and conditions in accordance with the ITU's patent policy. It remains unclear how - or whether - this impasse can be resolved.
NEC do Brasil has asked us to point out that NEC, not Qualcomm,
was the system supplier for Telecomunicacoes do Rio de Janeiro's
cellular network. Qualcomm was, in fact, the handset vendor.
Our apologies for this oversight.
Telecommunicaoes do Estado de Sao Paolo (TELESP CELULAR)
The next listings feature will appear in the May 1999 issue. However, all corrections or additions to the information already published can be sent to us at any time as our records will be regularly updated.