View from the top: Irwin Jacobs CEO of Qualcomm
by Tom Foremski
Published: March 18 2002 12:28GMT | Last Updated: March 18 2002 13:43GMT
Irwin Jacobs is a happy man these days. As chairman and chief executive of Qualcomm, the leading US mobile phone technology company, he likes what he sees around the world.
Although the past year has been tough for the sector with capital spending cuts and slowing mobile phone shipments, the first wave of third-generation (3G) wireless phone networks are being built, and - as he sees it - the battles between competing wireless technologies seem to be abating.
There is no question that 3G has been delayed by the fall out in the wireless phone sector. And, there is still scepticism whether there is a large enough market for a high bandwidth wireless digital phone technology.
South Korean operators, however, are moving ahead with 3G networks, rushing to have them operational by the time of the World Cup soccer competition this summer. South Korea will be a test bed for 3G and the types of services that people use, and are willing to pay for.
"There has always been concern with 3G that there will be applications that people want to use," says Mr Jacobs. Although South Korea will be an important test bed, he concedes that some of the applications will not be transferable because of cultural differences.
For example, Koreans like to download cartoon characters. But other applications such as e-mail, messaging, photos and stock information should be popular in the US and Europe. However, there will not be a single "killer application", he says, because the 3G applications will be many and tailored to the user and the culture.
"The closest to a killer application, we think, is that 3G users can download applications to their phones. This will be very important, because there will be a wide variety of things that people will want to use at different times of the day," he says.
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Technical standards - conflicting views send mixed signals to users
by Rod Newing
Published: March 18 2002 12:41GMT | Last Updated: March 18 2002 13:42GMT
North America continues to suffer from the lack of a single unifying standard. Europe standardised on GSM when it moved from first generation analogue systems to second generation digital networks.
However, when North America started to migrate to second generation networks it ended up with code division multiple access (CDMA), time division multiple access (TDMA), personal communications service (PCS), which is GSM in the 1900 waveband, and three other standards that were never deployed.
CDMA is a more efficient technology than the others, in terms of how it uses the spectrum available, and is being adopted worldwide for third-generation networks. However, because it is being implemented on existing networks, it is important to operators that upgrading is made as simple as possible. For this reason, Europe has adopted wideband CDMA (W-CDMA), which is compatible with the GSM standards.
But in North America, existing CDMA networks will use CDMA2000, which is much more compatible with the technology installed there. There will be a steady migration through different evolutions as data rates increase. Sprint and Verizon Wireless are the largest users of CDMA in North America.
The main users of TDMA, which is more like GSM, are AT&T and Cingular. Both are about halfway through a massive, long-term migration to GSM.
VoiceStream, acquired last year by Deutsche Telekom, already has a GSM network. All three will migrate to W-CDMA using a technology known as enhanced data rates for global evolution (EDGE). This provides third generation services on their existing 1900 MHz spectrum.
Both W-CDMA and CDMA2000 work in the same way, in that each conversation is split into separate packets that are transmitted mixed with other conversations. Each conversation is given a different code, which is sent with each packet, enabling the network to reassemble them into continuous speech.
For several years a "holy war" was conducted between enthusiasts for the two approaches. Fran O'Brien, director of wireless standards development at Lucent Technologies, was involved in an attempt by Europe, Asia and the US to harmonise them.
"There were technical and political reasons why people wanted new things to be different from old things," he says. "Some companies were also trying to avoid other companies' intellectual property, so there was a lot that prevented us getting the systems identical."
Nevertheless, there are some real technical reasons why CDMA2000 is different to W-CDMA. For example, CDMA and CDMA2000 use a narrower 1.25 MHz waveband band, because CDMA operators had only limited spectrum available, whereas W-CDMA uses a 5 MHz band.
According to Mr O'Brien, there are technical differences in the way the handset connects to a system when it is switched on, the way it detects a base station, the chipping rate (the number of bits per second used in the spreading signal, which codes each transmissions) and the way the handset is "handed off" as the user moves from one cell to another. In the event, some changes were made to both standards.
Robin Hearn, a senior analyst at Ovum, the telecommunications analyst, points out that because it is an evolution of the same technology, CDMA costs less for an operator to roll out than it does for a GSM operator to implement W-CDMA.
Comparisons
Outside North America, CDMA2000 is already deployed in South Korea with 2m users. W-CDMA is used by DoCoMo in Japan and Manx Telecom in the Isle of Man. Meanwhile, in North America Verizon Wireless started CDMA2000 in January.
The solution to the two standards issue is to have handsets that are multi-band and multi-mode, being able to operate over either system, as well as over the various second generation systems. However, roaming is not a major issue, according to some observers. Mr Hearn says 70 per cent of people make 70 per cent of their calls in their vehciles while commuting to work.
As for global roaming, Geff Belk, senior vice president for marketing at Qualcomm, points out that only 15 per cent of the population of the US owns a passport and only a fraction of them are global roamers.
"They are an important and profitable segment, but one of the operators recently said that only 0.25 per cent of their user base would be global roamers," he says. "There are going to be chipsets for roaming phone, which might be more expensive, but international travelers buy the right tool to get the job done."
Fiona Melhuish, a consultant in the telecoms practice at PA Consulting Group, a management consultancy, says that diversity of standards is not new to the US marketplace. "Operators have developed successful compensating marketing strategies," she says.
Clearly, marketing new services is going to be critical. New versions of W-CDMA and CDMA2000 are likely to leapfrog each other in terms of offering the highest data rates. "It will provide a healthy competitive environment," says Mr O'Brien.
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Why 2.5G reality lies behind 3G claims
by Paul Taylor
Published: March 18 2002 12:33GMT | Last Updated: March 18 2002 13:42GMT
For months, the main US wireless carriers have been waging a public relations battle over who would be the first to upgrade their wireless telephone networks to third generation (3G) or intermediate 2.5G technology. Verizon Wireless, Sprint PCS, Cingular and AT&T Wireless have all said publicly that they would be - or are - the first, and that their competitors are lagging far behind.
For example, in January Verizon Wireless became the latest carrier to claim that it had begun rolling out its 3G network and that about 20 per cent of its US subscribers would be covered. A few weeks earlier Sprint PCS had announced that it expects to have its 3G network in place nationally by this summer.
In reality, most of these networks, while described as third generation, are actually 2.5G services that will initially support data rates of up to 144 kilobits (thousand bits) per second. This is far slower than the broadband data rates promised for full 3G networks, as defined by the International Telecommunication Union (ITU).
As the Federal Communications Commission noted last July in its annual report on the wireless mobile sector, "many analysts and industry players believe that the widespread deployment of 3G networks and other advanced technologies is still several years away, given certain technological and economic obstacles yet to be overcome."
As in Europe, the roll out of true 3G services has been delayed by technical issues, equipment problems and the lack of real applications. In North America, competing technical standards and relatively low penetration of cellular telephony may also be a commercial constraint.
Rival carriers continue to argue over which of the two leading 3G technologies - CDMA2000 1X or W-CDMA (wireless CDMA, also known as UMTS) - is superior and whether or not it makes sense to implement intermediate 2.5G technology.
US network operators offer both analogue and digital services and employ a wide range of digital technologies including CDMA, TDMA, GSM and iDEN, and have adopted quite different technology roadmaps as they move towards 2.5G and 3G services.
The two largest US mobile telephone carriers that currently use CDMA as their 2G technology, Verizon Wireless and Sprint PCS, have said they plan to roll out CDMA2000 1X as the first phase of their 3G technology roadmap.
Voice capacity
CDMA 2000 1X will roughly double voice capacity compared with current CDMA networks and increase data transfer speeds to 144kbps. Both carriers eventually plan to deploy CDMA2000 1xEV - true 3G technology that may boost data speeds to 2.4 megabits (million bits) per second and support bandwidth-hungry applications such as wireless video.
But of the six nationwide carriers three, AT&T Wireless, Cingular Wireless and VoiceStream, Deutsche Telekom's subsidiary, have chosen to follow the GSM route, although Cingular says it has no plans at this stage to develop a full 3G UMTS network.
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For example, Verizon has said it expects that most subscribers who upgrade to its new network will use it to get a 40-60kbps connection for their laptops or personal digital assistants (PDAs).
It is also clear now that they will adopt a wide range of strategies and follow distinctly different roadmaps as they seek to migrate their subscriber bases from 2G technologies towards 3G networks. This could result in quite different timetables as well.
For example, after lagging behind European and other operators for so long, some US analysts are now suggesting that the relatively straightforward upgrade path for CDMA technology could give CDMA network operators an early edge in the race to deploy 2.5 and 3G networks.
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