VIEW POINT

When it rains, it pours.

That phrase certainly has been true for news taking place the last two weeks in the wireless industry.

The U.S. digital standards war is getting ready to wage battle as PCS PrimeCo L.P.-the consortium of Nynex Corp., Bell Atlantic Corp., U S West Inc. and AirTouch Communications-announced plans to use Qualcomm Inc.’s Code Division Multiple Access technology for its personal communications services networks, as well as their individual cellular operations once they are converted to digital technology.

While several companies (including the aforementioned) have made public their plans to implement CDMA cellular networks once the time came, they’ve also been known to change their minds. Bell Atlantic, for one, announced in February 1994 that it would adopt rival Time Division Multiple Access technology in its Washington/Baltimore market, rather than the CDMA technology it had been touting.

My take on this is if the consortium chose to make public its CDMA selection, it probably will stick by that decision. (Perhaps now they can spend their efforts coming up with a decent marketing name.)

Since the consortium is the first “really big” player to make CDMA its technology choice, the reality seems nearer that there will actually be two digital standards in America and all the headaches that can go along with that.

As we go to press, the Senate still is “almost” ready to vote on the telecom reform bill.

Then last week, the big news hit. The U.S. Supreme Court ruled federal affirmative action rules must meet stricter state requirements, throwing a wrench into the FCC’s planned Aug. 2 PCS auction.

At RCR press time, the FCC had postponed the auction’s filing deadline for short-form applications, and plans this week to introduce a new filing deadline. DEs are scrambling since the ruling could actually force the FCC to postpone the auction, which not only affects the female- and minority-owned companies planning to bid, but every other bidder as well.

My crystal ball won’t reveal the auction’s outcome in light of this ruling, but I do have three comments on the ordeal:

1. It would be disastrous to postpone the auction one more time. While postponing the auction may not prove catastrophic, it might feel that way. Potential PCS investors may already be more than a little nervous, being among the last to receive licenses is not likely to make them feel any better.

2. The FCC should have had a back-up plan. I like an idea proposed by the National Paging and Personal Communications Association that would replace the race/gender standard with a new small business standard.

3. Despite the FCC not having a back-up plan, PCS bidders are aware this is a high-risk industry, and with the Adarand case looming overhead, affected DEs should have had their own back-up plans. (I realize this is easier said than done).

At this point, there are only unanswered questions and the only auction certainty is uncertainty. That needs to change quickly if the entrepreneurial block auction is going to be successful.

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