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Technology Stocks : Vari-L (VARL)

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To: Gregory DeMoully who wrote (597)12/29/1997 6:17:00 PM
From: Frank Byers  Read Replies (2) of 2702
 
Yeah sure I'll comment. I'm a cellular engineer. Both analog and digital cellular can sound good and they can sound extremely bad, depending on the system design in your area. The primary reason the cellular companies have switched to digital is to increase capacity, not because it give you better quality. Pure analog is the best you can get, the digital cellular and PCS (they both use the same technologies, just a different frequencies) digitize your voice and then compress it, similar to zipping a big file on your PC. Except in the case of cellular (and PCS) the compression is lossy, that is to say you don't get back all the sounds when you reconvert to analog again at the receiver's end.

With digital you also get the opportunity to add more features, such as short message service, prepaid airtime, voice scrambling for enhanced privacy, caller ID, etc.

The PCS people want you to believe they are better than cellular, but in fact they aren't. Their coverage areas are smaller, meaning you have to buy an expensive dual-band phone and roam onto the analog cellular network when you leave the PCS coverage area. When this happens your call charges are higher, and your not getting all the digital features anymore.

Cellular carriers are slowly adding some digital capacity to their analog networks. But not all cellular systems will get upgraded, for instance in Colorado I cannot use my CDMA phone in digital mode when I leave Denver going west towards the mountains. It reverts to analog mode and I lose the caller ID feature and better batter life you get with digital.

Hope that helps. What this means to VARL, I guess it's not clear. Certainly more cell phones are being sold to people that upgrade from analog cellular to digital cellular or PCS. I suppose it's probably better for VARL if PCS adds subs at the expense of cellular as I suspect they have more parts being sold to the PCS phone builders, but I don't know for sure.

FB
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