Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT -- Ignore unavailable to you. Want to Upgrade?

To: djane who wrote (7684)	10/2/1999 12:16:00 AM
From: djane	Read Replies (1) \| Respond to of 29987

10/4 IBD. Competition Proves The Spark As U.S. Rapidly Goes Wireless As Prices Rapidly Plummet, Wireless Era Arriving Fast Date: 10/4/99 Author: Reinhardt Krause When cell phones first became readily available in the 1980s, most users were business executives. The average monthly bill in 1986, when there were 682,000 U.S. cell phone users, was $134. Fast forward to 1998. More than 69 million people subscribed to wireless services in the U.S. They paid an average $40 a month. Spot a trend? Once a luxury item, wireless phones are moving into the mainstream as air- time charges fall. A growing number of consumers are disconnecting home phones and using wireless phones instead, surveys show. Thomas Wheeler, president of the Cellular Telecommunications Industry Association, recently spoke with Investor's Business Daily about wireless services. IBD: What's driving more people to use cell phones? Wheeler: The key thing that will drive the future of the wireless industry is competition. Sixty percent of all American consumers can choose from six different wireless carriers in their market. We're going to see a different relationship between consumers and their phones. I don't think the wireless phone is going to flat-out replace wireline phones. I think it'll displace them. Today, about 4% of wireless users have no wireline phone at all. These are principally Gen-Xers that after college buy a big bucket of minutes. We did a survey where we found that 44% of people said they wanted one of the two (phone services) going into their home to be wireless. They want the functionality of the cordless phone in the kitchen, as with the car phone. People want mobility. That's why increased competition that continually lowers the (air-time) cost to consumers spurs a great growth opportunity. IBD: Industry pundits say that long-hyped wireless data services are ready for prime time. Are you sure there's demand? Wheeler: Wireless data have always been 18 months away. If you put it in context, in the 1980s there were two great innovations in how people communicated: voice mail and the advent of the wireless phone. They changed the out-of-office experience. In the '90s we saw e-mail and the Net change business communications. But we were still restricted outside of the office. We still primarily access e-mail or the Net from a hotel room or an airport, only once or twice a day. In the decade of 2000, we're going to see e-mail and the Net, combined with wireless delivery, have a dramatic impact on the out- of-office experience, just as voice mail and wireless had 20 years previously. IBD: Isn't Europe ahead of the U.S. in rolling out next-generation wireless services, including Net access? Wheeler: Historically, the federal government was slow to make wireless spectrum available, while European and Asian governments got a head start on us. The thing that worries me is whether we're repeating that history. In the last month, the FCC (Federal Communications Commission) ruled that it would keep in place an artificial cap on the amount of spectrum that wireless carriers can use to deliver services. The cap was put in place to make sure no one monopolized a spectrum auction process. But now, five years after the auction, it's an impediment to the growth of new services. If the FCC keeps the cap, American consumers are going to continue to sit behind their European and Asian counterparts. IBD: Iridium LLC has fared poorly providing global satellite phone services. As digital wireless systems cover more area, will they make satellite services unnecessary? Wheeler: Not unnecessary. People will always want to be on a boat in the middle of the ocean, or in the desert, or on an oil platform and still use telecommunications. There will be a market for that. The growth of the digital terrestrial-based footprint, though, has changed the atellite) business plan. What happened to Iridium is that in the course of implementing a cutting-edge technology, one of the basic business assumptions they were operating under changed. That was the limited nature of terrestrial wireless coverage. Clearly there's a new business proposition for satellite carriers, but I don't think it means the death-knell of them. They just need to redefine their market. IBD: More users of mobile phones are signing up for prepaid rate plans. Is this good for wireless carriers? Wheeler: It's a terrific trend for the industry. I'm hopeful that prepaid and calling-party pays will combine to offer American consumers the kind of opportunities that foreign consumers enjoy. The marriage of prepaid and calling-party pays will really change the way wireless phones are used in the U.S. It will open the market up to whole new segments of the population. We're the last country to adopt a calling-party-pays plan. (C) Copyright 1999 Investors Business Daily, Inc. Metadata: IRID E/IBD E/SN1 E/TECH