WASHINGTON-At a time when all the rage on Wall Street is about the Internet, a CEO of a major wireless company contends wireless is bigger.
Speaking at a luncheon sponsored by the American Enterprise Institute, Sam Ginn, chairman and chief executive of AirTouch Communications Inc., said, “Wireless is in 110 countries [while] the Internet is in roughly 10 countries. From almost every perspective, wireless [is bigger than the Internet] … I don’t think it is a perception widely held, particularly around Wall Street.”
That isn’t to say that Ginn doesn’t like the Internet; he does. He just believes instead of accessing the Internet by a personal computer, people should access the Internet from a wireless phone. While e-mail retrieval and other short text messaging services occur today, access to graphic-rich Internet sites is not yet possible, although Ginn expects it will be soon. Indeed, he believes the technology will be available to fully integrate wireless into the electronic commerce marketplace within the next 12 months.
Ginn, who founded AirTouch as a spinoff from Pacific Telesis, said even his mother questioned his decision to leave Baby Bell certainty to go into wireless unknown. But the wireless unknown has proven profitable for AirTouch and its investors. AirTouch has 12 percent of the worldwide wireless customer base and, “We created [more than] $1 billion per month in shareholder value since being created 55 months ago,” he said.
In his speech, Ginn gave the scenario that led him to agree to bought by Vodafone Group plc for $62 billion-a scenario that had him not responding to Vodafone’s initial request to negotiate since he already was in intense negotiations with Bell Atlantic Corp. But Vodafone’s official offer changed that scenario, he said. After three hectic weeks, “the market decided. The board did not decide. Every time it looked like Bell Atlantic was going to win, the stock would go down and every time it looked like Vodafone would win, the stock for both companies would go up,” he said.
Ginn also spent a good deal of time espousing policy positions pushed by the Cellular Telecommunications Industry Association, such as calling party pays, lifting the spectrum cap and less regulation.
CPP is similar to long-distance toll calling where the person placing the call to a wireless subscriber pays for the call rather than the wireless subscriber. CPP is the norm in Europe, while American carriers have traditionally required the subscriber to pay all charges related to mobile phone usage. A notice of proposed rule making allowing for CPP to be offered is expected to be on the Federal Communications Commission agenda June 10.
The spectrum cap prohibits any one company from controlling more than 45 megahertz of spectrum in a geographic area. CTIA has asked the FCC to remove the spectrum cap. A decision is expected by the end of the year.
