PCS PrimeCo L.P. has chosen AT&T Network Systems Inc. and Motorola Inc. to be equipment manufacturers for its nationwide personal communications services network.
AT&T and Motorola will split the contract equally, with Motorola primarily supplying radio transmitters and receivers. The total contract is valued at $1 billion, according to PrimeCo.
“Our agreements with the two companies will be sealed with a joint commitment to deliver the volume of equipment we require-where and when we need it, at a price that customers can afford,” said Benjamin Scott, PrimeCo’s president and chief executive officer. Final details still are being discussed.
PrimeCo holds PCS licenses in 11 major markets, covering a population of about 57 million. Under the agreements, AT&T will provide equipment for the Houston, New Orleans, Richmond, Va., and Tampa, Miami and Jacksonville, Fla., metropolitan trading areas. Motorola’s Cellular Infrastructure Group will supply complete PCS systems for customers in the Chicago, Dallas, Honolulu, Milwaukee and San Antonio MTAs.
PrimeCo expects to have its first PCS customers on-line by the end of 1996. Other equipment vendors that sought the PrimeCo contract included L.M. Ericsson, Qualcomm Inc. and Northern Telecom Ltd.
This is Motorola’s first major CDMA contract for the U.S. PCS market, but the company says it has shipped more than 400 commercially ready CDMA cellular cell sites. The first cellular CDMA systems using Motorola base station systems will be launched this year in Los Angeles and Hong Kong.
DSC Communications Corp. said it is delivering the advanced switching equipment for PrimeCo’s network. DSC is providing the hardware for Motorola’s EMX2500 switch. DSC and Motorola also developed the software for the switch, DSC said.
“We believe PrimeCo’s decision to award this business to Motorola is based on our proven ability to deliver CDMA systems and networking capabilities today to one of the nation’s most important new providers of PCS service,” said Jack Finlayson, vice president and general manager of Motorola’s Pan American Markets Division.
Motorola also has been selected to provide CDMA equipment for U.S. AirWaves Inc., which expects to bid for PCS licenses in the now-on-hold small-business auction.
Analysts with Salomon Brothers in New York said the PrimeCo contract will provide Motorola with incremental revenue opportunities beginning in 1996. The PrimeCo decision enhances Motorola’s position as a CDMA developer and manufacturer, Finlayson commented.
Along with the PrimeCo contract, AT&T also was chosen as the CDMA vendor for Centennial Cellular Corp., which holds a PCS license for the Puerto Rican market. AT&T also has an agreement with North American Wireless Inc. to provide a CDMA PCS network following the small-business auction.
U.S. Intelco Wireless also has chosen AT&T as its equipment vendor, AT&T said.
In addition, AT&T recently won a contract from its own AT&T Wireless Services division to provide part of the Time Division Multiple Access equipment for AT&T’s pervasive PCS network.
“With our proven CDMA technology combined with our highly reliable 5ESS switch-which delivers both wireless and wireline communications as well as voice, data and video-we will be able to help PrimeCo offer the most advanced capabilities to these high-growth markets in their territory,” said Carly Fiorina, president of the North American region of AT&T Network Systems.
PrimeCo is a partnership of the wireless divisions of U S West Inc., Bell Atlantic Corp., Nynex Corp. and AirTouch Communications Inc. Each have regional cellular systems that PrimeCo intends to connect with the PCS properties. The combined cellular-PCS footprint will cover 170 million pops in 26 of the nation’s major markets, PrimeCo said.
A primary competitor of PrimeCo, the Sprint Telecommunications Venture, has been in final CDMA contract negotiations, but has not yet announced vendors.
