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To: Maurice Winn who wrote (6019)7/1/2000 9:46:52 PM
From: Eric L  Respond to of 34857
 
Maurice,

Re: QUENTIN HARDY EXPOSED - Qualcomm Capacity Claims - Part One

<< Gus regurgitates this hoary old chestnut which derives from arithmetic Quentin must have done based on a theoretical discussion in 1989 about the possible capacity of a CDMA system which was still only in the 'on paper' stage. Field trials were only run in 1991. >>

Gus did great. I asked him if he had time, to "start at the commercial launch date of CDMA in September 1995, and elucidate on your point of Qualcomm "over-promising" and "under-delivering", and back it with some factual references?"

At least he did not dig up Bill Frezza from the archives.

He cited a reference one whole year (September 1996) later than I asked and I guess the article can be called "factual", because there are indeed some good and interesting "facts" in it that I can attest to because I was selling into the US GSM market from late 1994 forward (before the auctions and technology decisions), and talking daily to GSM, CDMA, or TDMA carriers at the time the article was written.

But ...

I think you are ABSOLUTELY correct.

Let me tell you why I say that.

I just went to the archives and exhumed two chestnuts. One I picked up at the Qualcomm booth in New Orleans, FL at the CTIA show in New Orleans, LA in February 1995, and the other at the first PCS show in the US (PCS95) that was held in Orlando, FL, in September of 1995. They are as follows:

* "Economics of PCS: A Tale of Two Networks" (Feb 1995)

* "CDMA vs. GSM: a Comparison of the Seven C's of Wireless Communications: (Sep 95)

Each spiral bound 8½" x 11" book is about 100 pages with appendixes.

Each book compares coverage capacity of a GSM Net (DCN-1900 or DCN-1800) v. a CDMA net with a variety of different scenarios.

Some quotes:

* On Coverage: "CDMA requires four times less cells to cover the same area as DCS"

* On Capacity: "CDMA technology uses much more efficiently than analog or TDMA, with more than 10 times the capacity of analog, and five to seven times the capacity of DCS-1900"

There are many examples, charts, and graphs, and coverage and capacity vary of course depending on population density, terrain, and many other factors, but these are the summary points.

In 1995, Qualcomm was NOT claiming a 13 to 1 advantage in capacity over GSM.

Now let me also share another quote from Quentin's article on Qualcomm and comment on it:

"CDMA delays have helped slow deployment of any digital-mobile-phone system in the U.S., leaving executives who need a single technological fix fuming. Bert Roberts, chairman of MCI Communications Corp. calls the conflict "a travesty." He and others say the tardiness of CDMA has set back, perhaps irrevocably, the formulation of a digital-wireless standard for the U.S. That means a caller on the West Coast, for example, could find his CDMA wonder-phone useless in a conflicting East Coast system."

As you probably know, MCI was a wireless reseller, in competition with AT&T (or McGaw Cellular) who created the IS-136 TDMA standard (along with Bell South & SBC). MCI lobbied heavily for a single wireless standard along the lines of Europe and specifically for the GSM standard. They had a wireless unit in DC, Texas, and Colorado, and they planned to bid in the 1995 auction A&B blocks for 1900 MHz spectrum, and build out a national GSM network.

They never participated in the auctions, and it was suggested this was because they figured that they could pick up spectrum at a later date on the cheap when DE's bidding in C Block, could not attract backing to build out, or defaulted on payments to the FCC.

So let me put it this way, I can see why Bert Roberts might call the "conflict a travesty".

As you might also remember, in his letter to the WSJ editor, about Hardy's article, Ira Brodsky noted:

"There are a number of other one-sided comments. MCI Communications Chairman Bert Roberts is quoted making scathing remarks about CDMA; the article fails to mention his firm just entered an agreement to purchase 10 billion minutes of CDMA airtime from Qualcomm spinoff NextWave Telecom."


Now so we can set the record straight here is what CDG is currently saying about capacity.

In a May "UpsideToday" article Jim Takach, Director of Advanced Programs for CDG was quoted as saying "The industry has demonstrated that the capacity of a CDMA network was 10 times greater than for analog cellular networks, and three times greater than for GSM networks."

In the same article, Anil Kripalani, Qualcomm's SVP for Technology Planning was quoted as saying that "CDMA can support about 10 times as many users as analog networks, and three to five times as many as GSM."

The article goes on to state that "while most systems can be tweaked to improve their performance, CDMA makes far more efficient use of radio spectrum than the other available technologies".

I believe this statement to be accurate and I'll take the statements of Takach and the low side of Kripalani's, which jives Gus's statement about Verizon or Vodafones to be reasonably accurate.

For the moment I think we can say that CDMA makes far more efficient use of radio spectrum than the other available technologies" by a factor of at least 3X. We can come back and reevaluate this a year from now when 1xMC (which doubles voice capacity) and GPRS are commercially installed, and see if 5X is applicable or exaggerated.

Enough for now. Part Two of "CDMA's Capacity Advantage" to follow (as Tero would say).

Have a Great Nokia Day.

- Eric -



To: Maurice Winn who wrote (6019)7/1/2000 11:30:56 PM
From: Eric L  Read Replies (1) | Respond to of 34857
 
Maurice,

Re: Qualcomm Coverage & Capacity Claims - Part Two

<< Gus regurgitates this hoary old chestnut ... >>

As I said, I think he did good. Heck, instead of citing a September 1996 Quentin Hardy WSJ DJ article, he could have cited the illustrious boo bird Steve Titch, who wrote "Blind Faith" almost exactly one year later.

Here is Ira Brodsky's response to Steve Titch:

>> Blinders
A response to the September 8, 1997
Telephony article, "Blind Faith"
By Ira Brodsky
October 14, 1997

When a person believes something for which there is no evidence, we call that blind faith. But when someone refuses to believe what has already been demonstrated - like the competitive advantages of cdmaOne™ - that's called wearing blinders.

After years of rancorous theoretical debate, 1997 was the year CDMA was put into widespread practice. Stunned critics watched silently as the technology they once described as an attempt to "violate the laws of physics" went live in city after city, amassing millions of subscribers. IS-95 technology, now known as cdmaOne, stepped into the bright sunshine of the free market.

Certainly cdmaOne had its birthing pains. And there are still several areas in need of improvement. So when Telephony magazine set out to determine whether CDMA was living up to its promises, they had the right idea. Unfortunately, reporter Steven Titch got swept up in the very same "holy war" he professed to abhor. Instead of an objective review of cdmaOne's achievements and shortfalls, he delivered a long-winded sermon teeming with vague allegations and thinly-veiled ad hominem attacks.

Shortly after the article appeared, the author assured me his only motive had been to provide readers with a more balanced perspective. That's certainly a noble cause. But it hardly squares with the article's "Blind Faith" title, or the "Hype" caption directly under a photograph of Qualcomm CEO Irwin Jacobs, or the constant insinuation that Qualcomm lied to customers-particularly since the article failed to identify a single CDMA operator willing to corroborate the charge.

"Blind Faith" begins with what has become the most familiar allegation against CDMA: that it does not deliver the capacity promised by Qualcomm. Qualcomm stated CDMA would provide 10 to 20 times the capacity of the North American analog standard, AMPS. Yet several U.S. operators report cdmaOne delivers about 6 times AMPS' capacity.

Is there a discrepancy? Qualcomm promised 10 to 20 times AMPS' capacity just when it looked like operators were going to standardize on 8 kilobit per second (kbps) voice encoders (vocoders). But the U.S. market firmly rejected the audio quality of a competing 8 kbps digital technology so-realizing they had a big capacity advantage-U.S. CDMA operators wisely upgraded to the 13 kbps vocoder. The 6 times AMPS' capacity reported by carriers employing 13 kbps vocoders is roughly equal to 9 times AMPS at 8 kbps. In addition, Asian cdmaOne operators who stuck with 8 kbps vocoders have publicly reported achieving 9 to 10 times AMPS' capacity. While these measurements barely reach the low end of Qualcomm's promised range, we must not forget they come from the very first commercial cdmaOne networks. Not a bad start.

Many of the article's allegations were based on competitors' opinions, statements taken out of context, or the author's far-fetched interpretations. A good example is the assertion that Lucent has been "quietly breaking ranks" with Qualcomm, telling customers not to expect more than 6 times AMPS' capacity. Again, this is at 13 kbps. And we must also remember Lucent and Qualcomm are competing infrastructure manufacturers. But most devastating is the fact Lucent has repeatedly told customers they can expect IS-95 CDMA systems to deliver twice as much capacity in fixed applications. Based on the original 8 kbps yardstick, that's roughly 18 times AMPS' capacity-close to the top end of what Qualcomm promised.

Next, the author charged that IS-95 networks "can be difficult to optimize amid rapid subscriber growth." It is hard to argue with that statement. It's difficult to optimize any cellular radio network amid rapid subscriber growth-not that cdmaOne operators are complaining, mind you. But according to the German GSM operator T-Mobil, who recently trialed a Motorola CDMA system, IS-95 works reasonably well using the manufacturer's default settings. Even so, it's true cdmaOne operators are just learning how to optimize their networks, and we can expect them to become more proficient as they acquire experience.

This was followed by the claim that CDMA cannot be overlaid on AMPS networks "in a 1-to-2, let alone 1-to-5, [base station] ratio with any expectation of quality coverage." Yes, there is disagreement among cdmaOne carriers about the best way to overlay an AMPS network. Some lean towards a 1-to-1 ratio of CDMA-to-AMPS base stations in urban centers. One operator suggests a 1-to-1 ratio of CDMA-to-AMPS base stations-but only in suburban and rural areas. Most operators agree, however, that it takes significantly fewer CDMA base stations to overlay an entire AMPS network.

The opening attack concluded with the observation that IS-95 CDMA "is far from being as mature as other digital wireless technologies." That's a reasonable statement, except the reporter implied cdmaOne vendors were claiming otherwise-again, with no evidence. The cdmaOne industry can be proud of how quickly it has brought a relatively ambitious technology to market, and more important, how quickly it has established cdmaOne as a legitimate competitor to technologies that enjoyed at least a three-year headstart.

Read further, and you'll find allegations in "Blind Faith" bordering on the absurd. For example, the author suggests there is a discrepancy between what Qualcomm promised and what CDMA delivers that "makes carrier business plans incorrect by several orders of magnitude." We are apparently to believe that carriers are continuing to deploy cdmaOne in city after city despite discovering it costs many times more than anticipated. Unfortunately, there is no way to know precisely what the author meant by "several orders of magnitude," because he presented no cost data.

Then we come to what was for me the moment of truth. "Blind Faith" informs us that coverage concerns delayed the commercial introduction of CDMA. Someone better tell Sprint PCS, who rolled out service in 134 cities over a twelve month period, and PrimeCo, who pulled off the largest simultaneous launch in the history of wireless. Or better yet, tell AT&T Wireless Services, who managed to roll out service in a paltry 10 cities during the same period using a competing technology. The empirical evidence that cdmaOne has a coverage advantage is so overwhelming, you have to be wearing blinders not to see it.

"Blind Faith" repeatedly misleads readers about other issues. For example, CDMA cell breathing is presented as an unexpected problem. Actually, cell breathing has been discussed for years and is one of CDMA's advantages. It hastens the launch of commercial services, and acts as an automatic load balancing mechanism as traffic grows. "Blind Faith" also asserts that cdmaOne systems can't do hard handoffs. This is simply false. And in a sidebar entitled "Count the cell sites," the author uses raw numbers from Tampa, Florida to suggest CDMA requires more cells. But he provides no data on the actual coverage and capacity of each network.

In the section titled "A Jihad is Launched," the author finally tells us what's really bothering him. He opines that IS-95 CDMA is mainly a nationalist reaction to the success of Europe's GSM, and accuses the CDMA industry of attempting to "block encroachment of GSM... into the U.S." But the exact opposite is true: Europe mandated GSM to the exclusion of IS-95 CDMA, while GSM networks are operating in dozens of cities across the U.S.

In researching "Blind Faith," the author placed all of his faith in people who have been crusading against IS-95 CDMA for years. One is consultant Richard Russell, who presented a paper at a GSM conference in April, 1996 in which he compared the CDMA industry to a British woman who claimed to have given birth to seventeen rabbits. In retrospect, he should have compared her to himself. In the very same paper he predicted the commercial launch of CDMA as an AMPS overlay would be delayed up to 18 months. But AirTouch launched an AMPS overlay service (Powerband in Los Angeles) just a few weeks later. Mr. Russell-like that British woman-was off by seventeen.

Sorry Steve Titch, but your sources were tainted, and your claims of objectivity proved hollow. The free market is the ultimate truth test: cdmaOne is off to the fastest start of any cellular technology in history. You couldn't name one manufacturer or operator who is unhappy about choosing cdmaOne. In fact, the only people complaining about cdmaOne these days are nervous competitors. And, oh yes-those who don blinders for religious reasons.

About the Author: Ira Brodsky is President of Chesterfield, Missouri-based consulting firm Datacomm Research Co. <<

Well, it looks like there are fewer and fewer boo birds these day, and far fewer people saying "QCOM has a clear track record of over-promising and under-delivering on the technology".

As Jorma Ollila would say, "I don't think we were quick enough to invest big enough in CDMA (Code Division Multiple Access). We should have done that earlier, more. Now we have a catch-up game, which we will win. We have decided we will win and we will."

Maybe one of these days I'll have my own CDMA kännykkä from Nokia. "Qualcomm Inside".

- Eric -

Qualcomm & Nokia, Together the World (as Chaz always said)



To: Maurice Winn who wrote (6019)7/2/2000 7:19:52 PM
From: Gus  Read Replies (2) | Respond to of 34857
 
Again, Maurice, in your eagerness to rush to the defense of your beloved Qualcomm, you failed to notice that my remark about Qualcomm's proven tendency to promise more than what it can deliver regarding CDMA technology was a direct response to Eric's query asking for more proof.

No amount of mildly amusing sophistry on your part can obscure the following items from that 1996 WSJ article alone:

He and others at Qualcomm claimed CDMA offered 20 to 40 times the capacity of traditional analog-cellular systems.

In December 1991, he told the industry press that all questions about CDMA "have been put to rest," a statement since updated and amended with several CDMA "improvements."

In January 1992, Dr. Jacobs claimed CDMA would be commercially available in 12 months, a timeline about 40 months off. "I was overly optimistic," he says.

There are more, but the essential point is made. Over-optimism may get very smart people out of a jam every now and then but the pattern remains the same and works against them over time. For proof of that, look at the way that CDG continues to maintain on its website that CDMAOne provides 4x to 5x the capacity of GSM or TDMA. This flies in the face of recent statements made by the likes of Verizon (3x the capacity) and totally ignores the capacity upgrades available to a GSM or TDMA operator.

More importantly, you missed the point about the importance of vendor credibility in a global industry like telecommunications which is undergoing wrenching deregulatory changes. Could QCOM's own big mouth perhaps be a factor in all the reversals it has encountered over the years?

Lastly, your attempt to correlate the cost of spectrum with the cost of royalties is curious, to say the least. It is now clear that there will be countries that will adopt the auction method (USA, UK, Germany, etc) while others will adopt the beauty contest method (Japan, France, China, etc), where spectrum is allocated to the fittest.

You're not suggesting that there is only one way to allocate spectrum, are you?

Take a look at how the Europeans, for example, are using wireless to create a multiplier effect throught its regional economy. It goes without saying that their heavily fragmented analog patchwork networks provided the impetus for them to harmonize their spectrum and coalesce around one technology: GSM, GPRS, EDGE, WCDMA, 4G, etc...

Given the culturally-rich but violent history of the European continental shelf, who is the idiot who will try to disrupt that kind of connectivity cohesion in the name of some convenient view of competition?

The vision: a world of radio-enabled mobile and wearable devices that talk to each other and to the Net, perhaps controlled by some sort of electronic pen or wand that may one day serve as a universal communications remote control for any appliance in the home, office or car........

"......Today's Internet infrastructure is just not good enough to support reliability, quality-of-service and durability needed for mobile communications. It's unacceptable," said Ilkka Pukkila, director of 3G strategic marketing at Nokia Networks.

Because a majority of the routers used in the Internet backbone today are not designed for wireless services, they tend to take far too long for routing and may drop packets, he added. "We have to build a lot of mobile-aware nodes in the network by adding higher-speed routing and service platforms to the current infrastructure," said Pukkila, an effort he said is "almost like building a highway on top of the Internet."

To tame conflicting air interfaces, Nokia is working on development of "one common resource manager," to be designed into a network to harmonize incompatible interfaces between a radio network controller network and packet subsystem. The idea is to provide interstandard handover so that service continuity can be maintained over heterogeneous networks, explained Pukkila.

Despite the hurdles for coming 3G broadband wireless nets, packet-switched data is already becoming available on today's narrowband phones. "We are not waiting for the wideband standard to fully perfect the bandwidth issue," said Nokia's Hayrynen. Even with limited data speed, "We are enhancing hardware to make things happen in a practical manner."
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