U.S. TDMA operators must make some critical decisions about competing in the wireless data market during the next year as they witness their CDMA counterparts begin to launch circuit-switched data services in large scale.
Time Division Multiple Access operators-which in the late 1980s banked on CDPD technology becoming the U.S. market’s data solution going forward-today do not have the technical capability to offer circuit-switched data, but could add it as competitive needs require.
TDMA operators are waiting for a new third-generation data solution called EDGE, a TDMA and Global System for Mobile communications packet-data technology that will significantly increase data speeds-up to more than 144 kilobits per second-and eliminate the capacity problems associated with circuit-switched technology. EDGE technology won’t be commercially available until 2001, and TDMA carriers must decide if enough demand will grow during the next year to justify investing in interim data technology.
“We’re becoming increasingly convinced that the data market is something we want to participate in,” said Greg Williams, vice president of wireless systems with TDMA operator SBC Technology Resources Inc. “Exactly how we enter the data market and what products and services we offer is the key point … We’re pretty knowledgeable about where all the different providers are, and we’re in a position that if we choose to move forward, we know how and when and where the time line would be.”
“We haven’t purchased [circuit-switched capability], but we could deploy it in a matter of days,” said Keith Radousky, director of engineering with BellSouth Cellular Corp. “I’d rather wait for EDGE and get some efficiencies on the network. We’ll see if we need to do it before then.”
Many cellular operators offer analog modem pools and CDPD service, but it’s clear today that offerings crafted around digital voice service are the future, as droves of consumers buy into the digital-is-better marketing message. Many digital operators are slated to offer more advanced commercial circuit-switched data services this year.
U.S. GSM operators from their inception have offered circuit-switched data services that involve linking wireless phones to laptop computers via a cable, and wireless data competition is beginning to heat up as Code Division Multiple Access carriers introduce similar services and GSM operators enhance their offerings.
CDMA operator Sprint PCS in September plans to commercially offer Internet service via handsets like the smart phone Neopoint 1000 and modems throughout its nationwide footprint. AirTouch Cellular and GTE Wireless are beginning to offer modem connection services, and later this year, more CDMA carriers will introduce limited Internet access via smart phones such as the Neopoint handset and Qualcomm Inc.’s PDQ phone. GSM operator BellSouth Mobility DCS plans to trial Wireless Application Protocol service with customers.
Thanks to AT&T Wireless Inc.’s Digital One Rate plan, network usage continues to skyrocket on the carrier’s networks. The operator cannot afford to clog up voice channels to offer circuit-switched data solutions.
The country’s largest wireless operator says it will continue investing in CDPD technology-which includes deploying the service Los Angeles-until the EDGE solution comes along. AT&T Wireless’ CDPD service, called PocketNet, is targeted at individual business travelers and provides access to corporate and personal information plus data from Internet sites.
“We’ve been testing circuit-switched service, but we think the ease of a flat-rate bill is a pretty darn compelling thing,” said Tom Trinneer, director of product strategy with AT&T Wireless. “No one can do that with circuit-switched service … We can put hundreds of users in single spectrum in one sector of the network.”
But since AT&T Wireless introduced CDPD PocketNet service in 1997, the take-rate has been a disappointment, even with a flat-rate charge for service. The Yankee Group estimates the carrier, which won’t release the number of CDPD customers it has, had 20,000 users at the end of 1998. The combination of CDPD coverage issues, coupled with a $500 analog phone, has hampered sales, said Phillip Redman, analyst with the Yankee Group.
AT&T Wireless offers PocketNet service in 87 markets, covering 130 million pops. Sprint PCS also will have sporadic coverage with today’s 170-million pop footprint.
“The analog phone has been one of the challenges,” said Trinneer. “That has not been a challenge in the business-to-business space. We’ve been selling the phones with digital rate plans.”
AT&T Wireless hopes a new quad-mode handset Mitsubishi Wireless Communications Inc. plans to release in the fourth quarter will ease concerns about selling analog handsets. Mitsubishi’s handset, the T250, will allow users to connect to CDPD networks, 800 MHz and 1900 MHz TDMA systems as well as analog networks.
However, other vendors have yet to announce similar handset solutions.
“We’ve looked at CDPD,” said Paul Shellgren, director of business and product development with Nokia. “But the future is about digital and packet data around digital. We’re focusing there.”
AT&T Wireless and other TDMA operators have another option. A protocol AT&T Wireless invented-called GUTS, or General UDP (user datagram proposal) Transport Service-involves running Internet Protocol services over control channels the way short messaging service works today. AT&T Wireless said it plans to use GUTS, which will provide limited Web access to customers via WAP-enabled handsets.
“It’s a two-way variant in the U.S. that works very well for browser services,” said Trinneer. “The control channel is a smaller network. It gives the capability to have the phone be a platform and add new applications after it has left the store.”
Nokia’s Shellgren believes some TDMA operators eventually will implement circuit-switched data, and GUTS will be used as another transport service. Nokia plans to introduce soon a WAP TDMA handset, the 710, similar to the 7110 GSM WAP-enabled handset it launched in Europe.
