EW YORK-Personal communications services are projected to triple their market penetration to 40 percent or more by 2006, according to participants in a “PCS: Here at Last?” panel. The discussion, held June 18, was part of the Bear Stearns & Co. Inc. three-day Technology Conference.
“I have a bullish outlook,” said David A. Freedman, managing director of Bear Stearns, and moderator of the panel. “PCS should enter the major (U.S.) markets by the end of 1996, and I’ll project it will more than triple in the next 10 years to more than 43 percent market penetration.”
Alan Battey, vice president of marketing for Sprint Spectrum, concurred with Freedman’s projections. “Revenues will double in the next five years,” he added.
Aiding the expanding inroads of PCS into the marketplace will be a marked decline in prices to consumers, predicted Clark Smith, chief financial officer of American Portable Telecom Inc. “The average (monthly) bill expectations start out at $50,” Smith said. “We’re looking at $30 service down the road that will support increased market penetration.”
Barry Winkle, executive vice president of sales and marketing for Pocket Communications Inc., formerly called DCR PCS Inc., agreed with the expectations of diminishing prices, following the pattern set previously by cellular service. But Winkle said he strongly hopes personal communications service providers will avoid another pattern set by cellular. “I hope PCS doesn’t get to the point of selling 99 cent phones,” Winkle said.
Sprint Spectrum’s Battey believes the PCS handset market instead will follow the appliance model of cordless phones. “We can move to have reasonable value in handset prices for units with good features, and people will pay for them the same way they do for cordless phones,” Battey said.
Even as PCS makes significant inroads into the wireless marketplace, voice communications still will dominate the way in which it is used, panelists said. “In terms of mobile voice vs. mobile data, voice will hold control of 80 percent to 90 percent, from a bandwidth standpoint,” said Winkle of Pocket Communications.
Christopher Resavy, senior director of engineering and operations for Omnipoint Corp., predicted, “a nine-to-one split between voice and data in the next five years, although data capabilities could go as high as 30 percent.”
Both Resavy and Irwin Jacobs, chief executive officer of Qualcomm Inc., predicted the commercial advent of full data packet applications in 18 months.
