YOU ARE AT:Archived ArticlesFUTURE OF WIRELINE QUESTIONED AS COST OF WIRELESS DECREASES

FUTURE OF WIRELINE QUESTIONED AS COST OF WIRELESS DECREASES

NEW YORK-Provided technological breakthroughs occur to improve transmission quality and quantity, wireless communications could become a substitute for fixed wireline communications within a decade.

That assessment was offered Jan. 25 by Michael Minter, managing director of Smith Barney Inc. of New York, at the fourth annual “Communications and Media Finance” conference, sponsored by the Institute for International Research.

With billions of dollars invested in infrastructure, regional Bell operating companies “are concerned about the future of wireline networks as the price of PCS [personal communications services] and other wireless services goes down,” said Minter, head of Smith Barney’s telecom group.

If you can’t beat ’em, join ’em. That’s the goal behind a bevy of mergers, joint ventures and other alliances that did or will occur in order to diversify product offerings and spread risk among companies, Minter noted. All alliances are geared to give long-distance, RBOCs, cellular, PCS and other communications carriers strategic advantage in an increasingly deregulated and competitive marketplace.

The much-rumored pending merger between Bell Atlantic Corp. and Nynex Corp. is just one high-profile example of this trend, according to Minter. “They have a real commonality with respect to strategy, geographic territory, issues faced from a regulatory standpoint, corporate culture and management style,” he said.

A key component of the scramble for strategic advantage will be the bundling of various services, according to Tim Dibble, a partner in the San Francisco-based venture capital firm of Burr, Egan, Deleage & Co. “Given the inevitable nature of wireless, the battlegrounds will be over long-distance voice, business dial tone, residential dial tone and data,” he said.

Data transmission also is key to future telecommunications, said Charles F. Auster, executive vice president of Voyager Networks, Inc., a New York-based carrier.

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