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Industry News

Commercial Market

September 1, 1997
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The Commercial Market

Ameritech Launches Digital Cellular Service in Chicago

Ameritech has launched its ClearPath digital code-division multiple access (CDMA) cellular service in Chicago with more than 13,000 of its analog system customers subscribing to the new service. Unlike digital personal communications service (PCS) carriers who offer handsets at market value, Ameritech launched its CDMA cellular system with existing analog customers by offering free dual-mode handsets that could be used in their analog mode until the digital service became available. Customers have been using the handsets since May. The Chicago introduction followed 15 months of testing on a 30-mile, seven-cell testbed. Engineers conducted drive tests of the network’s coverage area during off-peak hours to ensure an optimum test environment and no disruption to the commercial analog network. The testing was conducted with CDMA after extensive study of competing technologies. The system also offers caller identification, voice mail with a message-waiting indicator, and numeric and text messaging features. Ameritech expects to introduce CDMA cellular service in Detroit during the fourth quarter of this year and PCS service in Indianapolis and Cleveland by mid-1998.

Fiber-optic Premise Cabling to be Analyzed

The Fiber Optic Association Inc. (FOA) has initiated a study of the competitiveness of fiber optics in premise cabling to determine why fiber has been successful in some premise cabling applications but not others. Fiber optics has become the medium of choice in outside plant cabling and almost all telecommunications networks are fiber based. In addition, the majority of community antenna television systems are being converted to hybrid fiber-coax architectures. In spite of this widespread application, fiber still appears to be limited to backbone applications in premise cabling. Private studies completed to date have had little distribution and most lack substantial input from installers and end users. The FOA is a professional society comprising members involved in many aspects of fiber optics, including education, research and development, manufacturing, sales, system design, installation and end use. This application diversity ensures that inputs from all sectors of the industry will be considered as the FOA study is conducted. The final report will represent a position paper on the future of fiber optics in premise wiring and will recommend standards to enhance the competitiveness of fiber with copper for those applications. For more information, contact the FOA at (617) 469-2362, fax (617) 396-6155 or e-mail: foa@world.std.com. The survey questionnaire will be available on the FOA’s Web site (http://world.std.com/~foa/) when it is ready for distribution.

FCC Licenses Applicants for US Big LEO and Super GEO Systems

A recent report in Mobile Phone News reveals that the Federal Communications Commission (FCC) has granted licenses to the two remaining companies applying for big low earth orbit (LEO) satellite-based telephone and data service licenses. The licensees, Constellation Communications Inc. (CCI) and Mobile Communications Holdings Inc. (MCHI), plan to develop systems that will be less expensive to build than those under construction currently by their already-licensed competitors, Globalstar L.P. and Iridium LLC, and hope to offer lower fees to their users. The satellite-based telephone and data services are expected to be offered by 2000. However, the Globalstar and Iridium services are scheduled to begin in late 1998 — significantly ahead of their new competitors. CCI plans to build a 54-satellite LEO system at a projected cost of $1.2 B. The first phase, known as ECCO, will incorporate 12 satellites in equatorial orbit. The constellation will comprise an additional 42 satellites –– six located in each of seven planes. One spacecraft in each of the total of eight planes will be an in-orbit spare, leaving a total of 46 in active operation. The company indicates that it will concentrate on rural, low density areas for its subscribers. MCHI’s Ellipso system, estimated to be worth $910 M, comprises 17 satellites in highly inclined and equatorial orbits. The system is designed to keep more satellites in view of areas with large numbers of subscribers to guarantee access as demand grows. The Ellipso system’s fixed-site users will be offered a rate of 12¢ per minute. Mobile user rates are expected to be 50¢ during prime time and 24¢ during off-peak minutes. Reportedly, MCHI has lined up business for the system and has presold minutes at those prices. CCI also is planning to offer service at rates below 50¢ per minute. In related news, the geostationary satellite Asian regional mobile systems are expected to be operational at approximately the same time as the big LEOs. Both systems feature large L-band spacecraft antennas, which will relay the signals originating 23,000 miles below. A super GEO satellite designed by Hughes Electronics Corp. based on its model HS 601HP bus incorporates a single 12.25 m L-band antenna to handle both receive and transmit signals. Reportedly, the single-antenna design eliminates congruency errors between the transmit and receive beams. Lockheed Martin Corp.’s Garuda 1 satellite employs two umbrella-shaped, 12 m mesh reflectors, which are being supplied by Spar Aerospace for PT Asia Cellular Satellite. Both large antenna systems will be able to transmit a large number of spot beams — 140 for the Lockheed Martin design and more than 200 for the Hughes system. In addition, the systems will reuse frequencies in every seventh spot beam. The Hughes design will handle 16,000 voice circuits at a 10 dB link margin while the Lockheed Martin spacecraft will support 11,000 at that margin and 28,000 at lower link margins.

Study Forecasts $340 B Residential Telecommunications Market by 2005

Preliminary data for a study to be released by Kenneth W. Taylor & Associates, "Residential Communications in the United States," forecast that the US residential telecommunications market for services and infrastructure equipment alone will reach at least $340 B by 2005. Additional revenue exceeding $100 B will be available to suppliers of information/program content, advanced multipurpose terminals, and advanced chip sets and other semiconductors. The study is based on the premise that various telecommunications links to and from US residences often will be mixed and matched, and that dedicated networks will not be profitable during the next several years. The mixing and matching of wireline and wireless links into networks is expected to lead to maximum profitability over the next several years based on five advantages: pre-existing links (downstream and upstream) can be combined into interactive networks without requiring significant additional infrastructure; link mixing can combine wireline/cable television and wireless links using the links that are best able to satisfy the needs of a given geographical area; the mixture strategy provides a powerful time-to-market advantage, which can lead to early customer buildup, fortified competitive positioning and substantial attractive cash flow; costs will be minimized because it will be unnecessary to deploy transmission links that represent over investment; and profits are optimized in the short and medium terms because revenues are maximized and costs are minimized. The study identifies 14 emerging residential telecommunications networks that are expected to be synthesized from broadband and narrowband wireless and wireline/cable television links. For additional information, contact Kenneth W. Taylor & Associates at (916) 241-8490, fax (916) 241-8499.

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