Mika:
You and I differ substantially in our evaluation of 3G. As it relates to a GSM network, you know and I know, that W-CDMA will require swapping out the RF equipment so Ericsson's "migration" argument is smoke and mirrors.
Now let's think about 3G from a business perspective. Right now there is no "killer application" that would drive service providers to require high data rate wireless capacity. We can all talk about future applications, but right now email is paying the freight and I sincerely doubt that many subscribers would pay a significant premium for a high data service (moreover, since the carrier is selling minutes, it would need to get a sufficiently higher rate to offset the reduces airtime sales). So what gives? Why does anyone care about 3G?
In many geographies spectrum availability is being tied to deployment of third generation wireless infrastructures. So network operators want the 3G debate settled so they can get on with the job of growing their business. Within this context, the Japanese clearly balkanized themselves with their previous technology choice, so DoCoMo's adoption of W-CDMA was clearly intended to (a) yield a competitive advantage and (b) move Japan back into the mainstream of worldwide standards.
The key issue that GSM advocates refuse to confront head-on is..WHY direct sequence spread spectrum..why CDMA instead of some evolved form of TDMA? Clearly sophisticated operators have recognized that CDMA is sufficiently superior to TDMA that it is worthwhile to migrate the air interface to the CDMA platform. Unless you can convincingly refute this assertion, the magnitude of Ericsson's problem should be obvious.
Since the marketplace has decided that long-term CDMA is a superior air interface, ERICY needed to engineer some migration story that prevented a wholesale defection of its customer base. Understand that this is an issue of economics. Tero can talk until he is blue in the face about Nokia's (nifty) small handsets...but at the end of the day, the wireless business is capital intensive and operators are going to migrate to the technology platform that maximizes their return on capital. Given the inexorable economic differential between CDMA and TDMA, ERICY had to deliver a CDMA solution or face long-term Armageddon. The fact remains that EVERY IS-95 system in the world represents a loss of marketshare for TDMA-based technologies. Given TDMA's incumbency, i.e. IS-136 AND GSM, this accelerating loss of marketshare is certainly problematical. However, Ericsson could not very well announce that, quite belatedly, it was going to enter the IS-95 market. Ipso facto we end up with a smoke-and-mirrors 3G debate that presents a different value proposition to various constituencies, i.e. network operators get access to more spectrum, Ericsson gets to transition its air interface and Qualcomm gets to push for convergence.
What I find most frustrating about Ericsson's supporters is their complete and total unwillingness to acknowledge the facts at hand. In 1996, we were told over-and-over-and-over that TDMA was a superior technology; that CDMA would not work; that CDMA would be too late to market. Now with the passage of time, Ericsson supporters still try to argue that CDMA is somehow inferior to TDMA-based GSM, while at the same time telling us how great the world will be once ERICY transitions everyone to W-CDMA. Ever study the Crusades?
You know what Mika...I briefly dated a girl who owned a pug. While it was clearly the stupidest, ugliest, most psychotic, drooling, slobbering, smelly and otherwise vile canine that I have ever experienced, this lady thought her dog to be absolutely perfect, loving and beautiful. It would have been more likely that I could induce the sun to rise in the west and set in the east than it would have been for me to get her to dispose of this disgusting pooch. Such is life... People are going to believe what they want to believe. So...let me offer you a bargain. Let's defer the debate until year-end, until we see whether the ITU will allow W-CDMA to go forward without QC's blessing. At this point, we should all see more clearly who is telling the truth and who is bluffing. I truly believe that you will find the outcome illuminating.
Best regards,
Gregg |
