American Awakening
The U.S. catches up in the wireless race
By ALMAR LATOUR
June 25, 2001
Will the U.S. steal Europe's wireless dream?
Just last year, Europe thought it was the hottest wireless hub on Earth. Mobile phones were everywhere; operators were touting the arrival of the wireless Net; and equipment makers like Telefon AB L.M. Ericsson and Nokia Corp. promised that new wireless technologies would revolutionize the Continent.
By contrast, the U.S. looked far away from becoming a wireless wonder. Mobile phone operating systems varied in technology and markets were fragmented; mobile phones were still considered something of a Yuppie toy; and the wireless Web was not quite the buzz word it was in Europe. Even Steven Ballmer, chief executive officer of Microsoft Corp., warned that "the U.S. is the most far-behind wireless market in the world."
Today, things are looking a tad different: While still more European than American consumers have mobile phones, Europe's operators, bogged down with huge debts to pay for expensive wireless spectrum licenses, are less optimistic about their immediate future. Their so-called wireless application protocol, or WAP -- a wireless Net browser -- failed to appeal to consumers in Europe. And countless wireless start-ups have gone under.
Declining Utopia
So while Europe's wireless utopia is sliding, the U.S. looks to have woken up to the wireless world. Wireless Local Area Networks, or WLANs, which provide wireless access to the Net at broadband speed within a confined area, are hugely popular. Consumers have embraced wireless data devices, while most hand-held computing machines are being turned into wireless phones with add-on antennas. And even third-generation wireless technology, or 3G, which allows multimedia applications to run on wireless handsets, looks set to take off in the U.S. before Europe, thanks to Qualcomm Inc.'s CDMA2000 network technology.
"The U.S. has become much stronger on the wireless front," says Andrew Cole, telecom consultant for Adventis in Boston. "There are some advantages to not being first."
When it comes to developing wireless data devices, the U.S. is well ahead of Europe. The main hand-held computing device makers -- including Compaq Computer Corp. and Microsoft -- are based in the U.S., as are palm top pioneers Palm Inc. and Handspring Inc. Palm alone has sold over 15 million units so far, with most shipments going to U.S. customers. And hand-helds are rapidly turning into phones with add-on antennas that can be plugged into the device.
One gadget that has taken the U.S. business community by storm but has eluded Europe until now: the Blackberry -- a small wireless machine that can send and receive e-mails, produced by Research In Motion of Canada. While more than 400,000 units have been sold in the U.S., the product has yet to be launched in Europe. British Telecommunications PLC's mobile unit BT Wireless has only just signed an agreement with RIM to roll out the product in Europe this autumn.
Europe's Wake-Up Call
"Perhaps it's a wake-up call to European manufacturers of telecom equipment," says Simon Gordon, spokesman for BT.
And while Europeans are only beginning to get their high-speed wireless data networks up and running, many consumers and companies in the U.S. are already using wireless broadband in their everyday lives.
How so? Wireless Local Area Networks allow broadband usage of the Net within confined areas such as offices or homes. Users can plug a so-called LAN card into their laptops, which transmits and receives data to an antenna of sorts that in turn is connected to the fixed-line Internet.
While WLAN is not yet a mass application, some 11 million LAN cards have been sold in the U.S. to date and nearly 21% of U.S. businesses are using the technology. And by 2003 more than 50% of all U.S. businesses will use WLAN, telecom consultancy Adventis says. And it's not just an office tool: Starbucks recently announced it has plans to offer WLAN to customers in most of its U.S. branches -- so people will be able to surf the Net whilst sipping latte.
In Europe, however, usage of WLAN so far is negligible. And even on the 3G front, the U.S. is trying hard to win market share. Qualcomm's CDMA2000, which rivals Europe's preferred 3G system, W-CDMA, is slated to be kicked off in the U.S. by operator Sprint Corp. this year -- while 3G projects in Europe will take at least until 2003 to complete. Qualcomm also started BREW, a development platform that helps developers build wireless applications for the Internet, such as mapping, gaming, instant messaging applications -- services that will be available to U.S. wireless consumers this year.
"There is no reason the U.S. should continue to lag Europe," says James Enck, a telecom analyst at Daiwa Europe in London. "There is a lot of growth potential."
-- Mr. Latour is a staff reporter in The Wall Street Journal's London bureau
Write to Almar Latour at almar.latour@wsj.com |
