Telecom fires big digital shot in mobile war
18.07.2001 By RICHARD BRADDELL utilities writer
At the launch of a new digital network, Telecom Mobile
chief Mohan Jesudason exudes gung-ho and gusto.
If all the technical promises are met, and there seems a
good chance that they will be, he has a product to
outgun rival Vodafone and stop the slide in mobile market
share.
Mr Jesudason talks of a "whole new revelation in mobile
telecommunications."
Those who have experienced CDMA (code division
multiple access) during its pilot phase talk of voice
quality close to fixed wire.
In six months, the network should be capable of data and
internet services close to that promised by those behind
the still-futuristic third generation networks.
The CDMA network has cost $200 million to bring in, and
it should be cheap to operate compared with the three
other mobile standards used in New Zealand (Vodafone's
GSM and Telecom's existing analogue/digital).
It gives Telecom much-needed roaming capability to
Australia, as well as the United States.
Roaming will be important for business users, who will be
the main target of the network.
But the mobile war will increasingly be fought in data
markets, where people on the move will want to access
their company's networks and e-mail.
CDMA's data speed should make it a formidable
contender.
Its data speed of 14.4 Kbps (kilobits per second) is 50
per cent faster than its Vodafone equivalent. When
Telecom's high-speed 1XRTT service starts this year, it is
expected to run at between 70 and 100 Kbps, or more
than double Vodafone's GPRS.
GPRS has yet to fulfil its promise. Mr Jesudason is
scornful of his rival's product, which is hampered by a
lack of handsets and applications.
"I think you will be very hard pushed to find a customer
who's using it and happy with it," he said.
Telecom's CDMA launch has generally been
well-received.
Merrill Lynch said: "In the short-term, Telecom would
appear to have advantages over Vodafone in mobile data.
"1XRTT seems more advanced than GPRS and Telecom
seems very confident of having phones available by the
end of this year."
Telecom has tackled questions of its lack of global reach
through links with Hutchison Whampoa and Norway's
Telenor.
Analysts say CDMA is a premium product aimed at big
customers.
"At the consumer end of the market, there are no real
incentives for the mid to low-value prepaid accounts to
come across to CDMA," said broking firm JBWere.
But the analysts warn that there will be a hard fight
ahead.
Telecom has to woo customers from other networks but
if mishandled, they could defect to Vodafone when
re-investing in handsets.
If CDMA proves superior to Vodafone's existing GSM
technologies, that will be a strong incentive for Vodafone
to make an early move to third generation mobile.
That would force Telecom into a new round of spending
to keep up in the mobile race.
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