AirTouch Communications Inc. shut down its nascent cellular digital packet data network in San Diego-apparently the casualty of changing approaches to CDPD business development.

According to a “report card” issued by the CDPD Forum last January, AirTouch was supposed to be testing the new mobile data technology over an area equivalent to its cellular voice coverage in the San Diego market with commercial service beginning sometime in the first quarter. But AirTouch spokeswoman Susan Rosenberg confirmed the trial has been discontinued.

“We decided not to continue with it because we haven’t seen enough market demand,” she said. She also confirmed that Lee Franklin, president of AirTouch’s Cellular Data Group, left the company several months ago and his department has been folded into the cellular marketing group headed by Vice President of Marketing Ujjal Kohli.

The CDPD technical standard was unveiled two years ago by a number of cellular carriers who wanted to transmit packetized data over their analog networks to compete with the dedicated packet-radio networks of Ram Mobile Data USA L.P. and Ardis Co.

“Ram and Ardis built their systems out before there were customers. Evidently AirTouch is not willing to do this-which indicates to me that all is not well with CDPD,” said Andrew Seybold, an industry consultant and long-time critic of the way CDPD has been introduced.

Seybold noted last April that a new and unexpectedly low pricing schedule announced by McCaw Cellular Communications Inc.-16 cents per kilobyte-could jeopardize deployment financial projections for many carriers by placing a ceiling over what they could charge before their systems were even built out.

CDPD is still largely targeted at vertical market applications where investment payback from new revenue is undermined by the costs of a sales cycle that stretches out as long as 18 months.

“Upper management in cellular is tired of promises and no income,” Seybold said.

Rob Balgley, vice president of sales and marketing at specialized channel distributor Wireless Telecom Inc. said, “Nobody really knows the cost of customer acquisition for CDPD. What’s happening is the carriers are starting to realize that deploying technology is only part of the solution.”

In pursuing the multibillion dollar jackpot in mobile data, cellular carriers have been focusing most of their efforts on working out the bugs in CDPD’s frequency-hopping technique as well as network interoperability. Market education and applications development have lagged.

Rand Baldwin, executive director of the CDPD Forum said, “As a product, CDPD is very much in the early stages.

“AirTouch made a specific decision for a specific case in a specific city. Everybody’s got a lot of irons in the fire and they just decided to pull one out. AirTouch is still very much involved and is an integral part of the CDPD Forum,” Baldwin continued.

AirTouch reportedly will continue to test CDPD in the San Francisco Bay Area as well as Kansas City, Mo./Kan., in a joint venture with McCaw called CMT Partners.

Baldwin also noted, “From the customers’ standpoint, there’s still CDPD coverage in San Diego. The footprint hasn’t changed.”

The A side cellular carrier in that market-U S West Cellular Inc.-opted out of CDPD at the beginning but is scheduled to swap its San Diego franchise with GTE Mobilenet Inc.

GTE spokeswoman Susan Asher said the San Diego swap will close July 1 and that GTE intends to roll out CDPD service in that market.


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