Editor’s Note: Welcome to our coverage of 25 years in wireless. RCR Wireless News is celebrating with a package of stories detailing the advances of the past three decades. For full coverage please visit RCRWireless.com/25years.
The wireless industry’s evolution from that first call placed 25 years ago at Chicago’s Soldier Field to the high-speed, mobile data networks that allow customers access to the world with the touch of a button, can be tracked with just four numbers: 1, 2, 3, and soon 4.
For an industry that thrives on acronyms, the ability to follow the evolution of network upgrades with just a few numbers followed by the letter “G” is refreshing.
It all started with a call
That first call was placed over what is known as a first-generation, or 1G, network. Analog AMPS networks, which were the backbone of the wireless industry for several years, were designed to handle basic voice conversations on lightly loaded wireless networks. And despite their drawbacks, which included poor spectrum use and often static-filled calls, they performed admirably. By the end of the 1980s, more than 1 million customers across the country had signed up for wireless services using 1G networks.
But, that growth, as well as other issues like cloning, required an evolution if the wireless industry was going to continue to grow. The answer was the switch to digital, which would only allow networks to handle more calls, and would enable smaller handsets with longer battery life, both bugaboos of analog.
In North America the push to digital was heralded by the Time Division Multiple Access standard, which assigned digitized voice signals to different time slots that were sent from the handset to a base station, where they were either converted back to analog voice and onto a landline phone or forwarded along in digital form to a mobile handset, where it was then pieced back together. Problems solved.
Holy wars
While the move to digital, also known as 2G, seemed like a no-brainer, the move opened up wireless networks to different ways to digitize those voice calls. Looking to forge their own path in wireless, countries outside North America developed a TDMA alternative, Global System for Mobile communications, which was based on the same principals as TDMA. GSM received a strong boost when a number of European countries required wireless carriers to use the technology for their digital networks.
In North America, 2G got interesting when an upstart technology company out of San Diego developed a technology for cellular applications that relied on long-used military technology to break up voice calls into coded bits. Qualcomm Inc.’s Code Division Multiple Access protocol was questioned, sometimes vigorously, for its ability to perform on the large scale needed by growing cellular networks. The battle between the established TDMA standard, backed by carriers and infrastructure providers, and Qualcomm’s CDMA effort was so heated that most refer to it as the “holy wars” of wireless.
After some initial stumbles, Qualcomm proved that CDMA was able to cope with the demands of the cellular industry and that it even provided spectral efficiencies compared with TDMA. CDMA gained further credence when a number of carriers that won spectrum during the personal communications services auctions of the mid 1990s decided to build their new networks with the upstart technology.
Free money
With two technologies available and a regulatory environment that did not favor one over the other, carriers were able to play infrastructure providers off each other. This was most often manifested in vendor financing agreements that saw the infrastructure vendors front carriers money to build out their networks in an attempt to gain those valuable contracts. With the country just starting to feel the financial windfall from the dot-com boom, these vendor financing agreements looked to be win-win deals for both the carriers, which were strapped for cash after spending billions for spectrum licenses, and the vendors, which were supplying tens of thousands of base stations for these growing networks.
These advancements also allowed carriers to more aggressively market their services and led to strong growth in the wireless market that grew from around 25 million customers in 1995 to nearly 100 million by 2000.
More speed
Even though basic digital services were proving well-suited to serve the wireless industry, technological advancements marched on. Networks were soon able to support services beyond basic voice offerings such as text messaging, basic Web browsing and downloadable content like ringtones and games. Carriers realized that these non-voice applications would allow them to offset dropping voice revenues, and consumers realized that they could do more with their handsets than just talk.
These non-voice enhancements led to third-generation networks that could support more data-intensive applications and higher-speed data transmissions. Similar to 2G, carriers moved into 3G behind one of two technology paths. Most that had deployed CDMA-based networks maintained the evolution path set forth by Qualcomm, while others merged behind the GSM-based evolution path that included such fun acronyms as GPRS, EDGE and eventually UMTS/HSPA.
These networks have allowed carriers to deploy more advanced data services, multimedia offerings and begin to compete with traditional landline Internet services, sometimes with stunning success. According to Scott Siegler, an analyst with the Dell’Oro Group, UMTS/HSPA, the dominant 3G technology, reaped $2 billion in revenue for the first quarter of 2008.
4G and beyond
With 3G firmly entrenched across the country, carriers are now looking for the next big thing, tentatively dubbed “4G.” Unlike 3G networks, which are built on 2G, circuit-switched architecture, plans for 4G call for new networks that use Internet Protocol at their base and are similar to high-speed wireline networks.
Two camps have formed on the quest for 4G: those behind Long Term Evolution technology, which has a strong support system and could provide a truly universal technology that would unite the GSM and CDMA camps; and those behind WiMAX, which tout a time-to-market advantage over LTE as well as other technological benefits that could serve wireless broadband needs. Some in the industry have characterized the WiMAX vs. LTE debate as a reincarnation of the TDMA vs. CDMA holy wars of the ’90s.
Analysts predict that both technologies have bright futures ahead in an industry where many technologies have ended up on the scrap heap. (pACT, B-CDMA, CT1, CT2, FLEX anyone?) According to ABI Research, there will be more than 32 million subscribers in the world using LTE by 2013. In a report issued late last year, Juniper Research estimates more than 80 million people will use mobile WiMAX technology by 2013.
WiMAX’s main advantage over LTE is that it’s available today. The technology was deployed last month by Sprint Nextel Corp. in Baltimore. The carrier is expected to expand WiMAX service to Chicago and Washington, D.C., by the end of the year and across the country once the pending merger between Sprint Nextel’s Xohm business and Clearwire Corp. is completed.
LTE is not expected to be deployed until at least 2010. Verizon Wireless is working to develop the technology with European giant Vodafone Group plc. AT&T Mobility Inc., the largest carrier in the United States, has also said it will deploy LTE. Further support has come from T-Mobile USA Inc., which is still in the process of deploying its 3G network, and the industry’s No. 5 carrier, Alltel Communications L.L.C., which is in the midst of being acquired by Verizon Wireless.
How will it all play out? That’s for those with more knowledge than us, but one thing you can be sure of is that even though
the wireless industry has yet to move very far into the 4G space, engineers are already working on the next “G” to fuel the industry for another 25 years.
