Microwave Journal

Commercial Market

January 1, 1999

Commercial Market

Iridium Debuts Global Satellite Telephone Service

Iridium LLC has initiated commercial service on the world's first hand-held global satellite telephone and paging system. The system offers users the ability to communicate from virtually anywhere using one telephone and one number with one monthly bill. The Iridium system, a constellation of 66 low earth-orbit (LEO) satellites that function with terrestrial wireless systems, is authorized in more than 120 countries and territories and has more than 270 distribution agreements in place with service providers and roaming partners who provide Iridium access to more than 105 million wireless telephone customers.

The worldwide service offers a direct satellite link to hand-held telephones in regions that are served poorly or are unserved completely by wireline or wireless telephone service. The system permits roaming across previously incompatible terrestrial wireless networks and its paging service will offer alphanumeric paging to belt-worn units in terrestrial or airborne locations. Multimode Iridium handsets will employ plug-in radio cassettes to make them compatible with cellular systems throughout the world.

Hand-held telephones are being supplied to regional Iridium Gateways by Motorola and Japan-based Kyocera. Motorola will offer cellular cassettes for GSM900 and CDMA/Advanced Mobile Phone Service (AMPS)/narrowband AMPS800 standards and Kyocera telephones will support GSM900 and personal digital cellular standards.

Copper to Play Major Role in New IC Interconnections

According to a recent study conducted by Business Communications Co. Inc. entitled "The Copper Revolution in Semiconductors: Market Opportunities in Materials and Equipment," the total materials and equipment market to apply to copper technology will reach $380 M by the end of 2003. The average annual growth for the market through 2003 is expected to occur at a rate of 26.9 percent. While tool sales are forecast to grow at an average annual rate of nearly 20 percent from an estimated $112 M in 1998 to $275 M in 2003, their share of the total market is expected to fall from 95 to 70 percent.

Equipment sales are expected to rise sharply in 1998, fall slightly in 2000 and rise again from 2001 through 2003 to their forecast $275 M level. Copper electroplate and chemical mechanical planarization equipment will account for the majority of purchases. Other tools are expected to require only additional or replacement modules to accommodate the copper technology.

Materials sales in copper technology, estimated at $3.5 M in 1998, are expected to exceed an annual level of $100 M in 2003, an average annual growth of 97.4 percent per year. Growth will be fueled by device suppliers bringing new capacity on line and by the addition of circuit complexity and interconnect levels to their devices. For additional information, contact Business Communications Co. (203) 853-4266 or e-mail: publisher@buscom.com.

One-telephone, One-number Digital Office System Demonstrated

Ericsson Inc. recently demonstrated its Digital Wireless Office System (DWOS), a premise-based digital communications system that provides a full-featured one-telephone, one-number capability that can be used inside or outside the office. Ericsson entered into a joint marketing agreement with AT&T Wireless Services in 1998 to explore mutual opportunities for DWOS applications.

DWOS is a wireless extension of the wired personal branch exchange (PBX) that is able to operate at both the 850 and 1900 MHz licensed frequencies. As a result, users can roam freely from an in-building wireless system to outdoor cellular/PCS networks. The system's in-building radio network serves standard digital wireless telephones that can also connect automatically to TDMA wireless networks when outdoors. The system's integration with the PBX supports features such as call waiting and forwarding and message waiting indicators, and allows voice mail to be retained.

Mobile Satellite Services Market Analyzed

A white paper from Ovum Inc. has been released that reviews the development of mobile satellite service (MSS) systems, the current cast of key players in the market and the prospects for their success. The paper identifies the possibility of global roaming becoming the principal MSS attraction, stressing its ability to extend complete coverage instantly to remote and rural regions.

Satellite power and antenna performance limitations at the inception of the work on the active systems dictated the use of LEO constellations. Since then, technology advancements have made it practical for second-generation systems to offer service to hand-held terminals from geostationary (GEO) satellites and compete with the LEO systems. These advancements have brought forward several other GEO system proposals, including Iridium, GlobalStar, ICO, Constellation and Ellipso. However, only Iridium and GlobalStar have reached 100 percent financing and Iridium is the only system that is operational.

According to the paper, the biggest problem facing MSS operators is gaining regulatory approval in the form of licenses from each country to provide truly worldwide service. Since some developing countries have no regulatory system, difficulties are expected. In addition, some governments are concerned with the loss of revenue to their communications infrastructure because traffic bypasses that network. Thus, some of the ventures are proposing gateways in each country so that their networks can share in the MSS revenue.

Specific risks with which MSS operators will have to contend are expected to include a limit on the amount of capital available for the ventures, some uncertainty about the technologies that have not been tested in the commercial market and satellite launch problems. In addition, the continuing rapid installation of cellular and PCS infrastructure will, to some extent, reduce the need for MSS and, finally, the prospect of broadband MSS (which will offer data rates of 1.5 Mbps compared to a maximum of 9.6 kbps for the current systems) will affect their ultimate success.

The paper forecasts that the MSS worldwide subscriber count will grow from 91,000 in 1998 to 11 million by the end of 2007 and that MSS service revenues will rise to $5.2 B by 2007. MSS operators are expected to account for $3.7 B of the total market with $1.6 B going to service providers. For additional information, contact Ovum Inc. (800) 642-6886, fax (781) 272-7446.

WLL Market to Grow Rapidly through 2006

A new report from Allied Business Intelligence Inc., "Wireless Access Solutions to Local Loop Telephony: 1998," predicts that the wireless local loop (WLL) market will grow from approximately two million WLL subscribers by the end of 1998 to 100 million by the end of 2006. The report points out that practical application of the technology has thus far been discouraged by its high price-per-line rate. While the target rate of $500 per line has not quite been reached, current costs of $650 to $850 per urban line and $1000 per rural line have been attractive enough to support market growth. The worldwide WLL infrastructure market is forecast to grow along with the technology's subscriber count. An estimated 17,600 base stations in use at the end of 1998 are forecast to increase to 714,200 by the end of 2006.

The study provides forecast breakdowns for world regions and 60 countries. Service and infrastructure vendors and operators are identified. For additional information, contact Allied Business Intelligence (516) 624-3113, fax (516) 624-3115 or e-mail: info@alliedworld.com.