LAKE BUENA VISTA, Fla.-“Until a few weeks ago, I was under the impression that the outlook for TDMA (Time Division Multiple Access) was quite different than it is today,” said investment banker Brad Peery at last week’s TDMA Global Summit here.

“Qualcomm (Inc.) has done a good job of portraying the 10-times (analog cellular) capacity of CDMA (Code Division Multiple Access),” said Peery, who is president of Brad Peery Capital, Mill Valley, Calif. “TDMA advocates have not been as verbal about the capabilities that IS-136 offers.”

The Interim Standard-136 version of TDMA allows Advanced Mobile Phone Service, the United States analog cellular standard, to co-exist with TDMA digital cellular networks using the same frequencies and radio channels, according to Universal Wireless Communications, Redmond, Wash. UWC, a consortium of vendors and carrier promoting TDMA, held a “Global Summit” here last week on TDMA.

“I’ve changed my view about IS-136, and think it is probably a given it can offer 10 times the capacity (of AMPS),” Peery said. “I think IS-136 stacks up in the ballpark with CDMA. I’d place GSM (Global System for Mobile Communications) third as a technology choice; its capacity won’t be as good and it won’t be as good a technology for networking.”

Realistic laboratory simulations have shown that CDMA can deliver on its promises of greater capacity and better call quality, according to Iain Gillott, director of wireless broadband and networking for the market research firm of IDC/Link Resources, Austin, Texas. In the real world of customer usage, however, Gillott said he doubted that CDMA would live up to its advance billing of “toll quality” or that the average user would notice the difference in call quality between IS-136 TDMA and CDMA.

“With the Sprint and PrimeCo deployments proceeding, we will finally get real-time experience in loading capacity and voice quality,” Gillott said. “Qualcomm makes a compelling argument for the soft handoff as an attractive feature, but there are those who would argue that giving up capacity for this may not be worth it.”

Qualcomm has promoted its product and service offering on the basis of superior voice quality from 13 kilobit per second vocoders. With respect to voice quality, a critical characteristic for consumer acceptance, “TDMA doesn’t have a good image,” Peery said. But a new generation of 8 Kbps TDMA vocoders, expected to be available mid-year, along with additional voice quality improvements expected farther in the future, should improve TDMA’s reputation in this regard, he said.

Peery added that he is uncertain “how dynamic in terms of upgradability” vocoders are that are used in GSM handsets.

In the United States, minutes of use rather than market penetration is fast becoming a benchmark for carriers’ business success, as dramatic increases in wireless capacity result from both advances in technology for efficient use of spectrum and added spectrum available for commercial use.

Consequently, Peery said, successful wireless players will need to capitalize on both roaming and fixed-use revenues.

GSM has far broader international coverage, according to Gillott. “Both GSM and IS-136 are older technologies that work. The difference (today) is that GSM has taken off worldwide,” he said. “My candid view of IS-136 is that it’s been dominated by AT&T. My impression is that it’s a North America only standard, but that will change as more and more countries adopt it.”

With dual-mode, AMPS-TDMA handsets, IS-136 networks offer “ubiquity, not only in the United States but worldwide in more than 100 countries, with AMPS as a backup technology,” Peery said.

Ericsson Inc., Lucent Technologies Inc., Motorola Inc. and Nokia Mobile Phones now produce wireless handsets that are both dual-mode and also dual-band, so that they can be used on AMPS, IS-136 TDMA and personal communications services networks, said Michael F. Buhrman, chairman of the UWC Board of Governors and vice president of AT&T Wireless Services Inc.’s wireless strategy group.

“Qualcomm has the largest number of orders for handsets of all the handset makers; it has increased its manufacturing capacity to 3.6 million a year and is making up to 200,000 a month this quarter,” Gillott said.

Ultimately, a successful wireless play based on usage will depend on the ability of carriers to capitalize on, “the opportunity to create a ubiquitous mobile-fixed environment, with pricing reflecting the environment,” Peery said. “Then, if you get 5 percent penetration, you get 5 percent of the whole business, not just the wireless side.”

The IS-136 version of TDMA also permits-“to a limited extent at this point” -instant customer billing based on the location from which they place their calls, Peery said.

However, a key advantage of CDMA in the fixed wireless arena is that it operates at power levels much closer to those of cordless phones and far lower than those of TDMA handsets, Peery said.

Another key component of a successful wireless play in the United States is for carriers to link up “as part of a nationwide service offering,” Peery said. At this point, he said, IS-136 TDMA has been chosen by AT&T Wireless Services, Bell South Cellular Corp. and Southwestern Bell Mobile Systems. AirTouch Communications Inc., Ameritech Corp., GTE Corp. and Sprint Spectrum have selected CDMA technology. Nextel Communications Inc. has picked integrated Dispatch Enhanced Network for providing communications services in the specialized mobile radio spectrum.

“Omnipoint (Communications Inc.), Pacific Bell (Mobile Services) and others are close to putting together a nationwide GSM network,” Peery said. “And MCI (Communications Corp.) is the wild card, depending on what happens with NextWave (Telecom Inc.).” NextWave has chosen CDMA technology.

CDMA “is incredibly late as a technology,” Gillott said. But he also noted that AirTouch, which has used all the technologies, “has said the deployment of CDMA actually will be faster than (that of) GSM.” Nevertheless, analog cellular carriers choosing to convert to TDMA will gain a cost advantage because the process will incur only incremental changeover expenses, Gillott said.

“Both CDMA and IS-136 will be successful in a war that will continue. It is almost a religious war because so many people have staked their careers on it,” Gillott said. “If CDMA was a business plan only, it would have failed years ago. But if Motorola (Inc.), Nortel (Northern Telecom), Lucent (Technologies Inc.) and (South) Korea (among others) have chosen to adopt the technology, they have to know something. I have confidence in them. They’ve bailed me out before.”


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