marginmike, All; Gilmore of MOT CDMA Views;
From the September 14, 1998 issue of Wireless Week
Gilmore: Motorola Missed TDMA/CDMA Curve
As PCS '98 approached, Wireless Week Technology Editor Brad Smith spoke with Merle Gilmore, president of Motorola Inc.'s Communications Enterprise Group.
The wide-ranging discussion touched on where CE is headed, the status of the industry, the importance of data, 3G and technology in general.
Wireless Week: You have said you were late introducing code division multiple access and time division multiple access digital handsets. What were the reasons for
this and have they been corrected?
Merle Gilmore: I think the biggest issue there for us was basically the breadth which our portfolio covers in handsets ... I think the simple answer is that we didn't
have enough resources in place to handle the magnitude of the issue for us. We obviously also didn't forecast how quickly it would move. The last 12 to18 months,
the market here, especially in the United States which is one of our larger markets and certainly a market where CDMA and TDMA come into play, had moved very
substantially away from analog and toward digital. We just plain and simple didn't have enough resources in place early enough to enable us to get in front of that
curve. That is a problem that is right at the top of list of problems we are addressing with the Enterprise.
Last year we made 65 million wireless devices, pretty close to what we think were about half the wireless devices built in the world when you add together what we
manufacture in cellular handsets, paging and two-way radio. In that capability we've got lots of resources.
WW: One of the pioneers of handset manufacturing, Oki telecom, recently withdrew from the business. Is this the first in a number of consolidations in handset
manufacturing or are marginal companies going away?
Gilmore: It's actually a trend we've seen all along. People come and go in this marketplace. I think we still have a very long way to go in cellular handsets, but as we
enter a more mature phase in this marketplace we will in fact see some consolidation of players in the industry.
WW: Switching to another topic now: data. Many analysts believe that telecommunications generally is becoming data-centric rather than voice-centric. What is
Motorola looking for in data?
Gilmore: What we see is the overall telecom and information-technology industries in a convergent mode right now. First of all, we see a convergence of voice and
data. We also see a convergence of wireline and wireless. At the same time, the Internet has fundamentally changed the world forever. As data communications
focuses on the kinds of reliability capabilities that telecom traditionally provided, technologies like voice-over IP develop. What we will be looking at in our
telecommunications and data communications systems--wireline or wireless--is infrastructure that will move bits. Some of those bits will be used for data and others
will be used for voice. There will always be a strong need for both, but without question, we'll see the networks converge.
That trend is one of the primary trends that we've based a lot of what we've been doing with the new organization at Communications Enterprise.
WW: Can you explain what CE's vision and role may be? What do you have in the pipeline?
Gilmore: First of all, I think virtually all of our products have to be responsive to this convergence question. We're preparing ourselves to be responsive in virtually
all of the areas of our business--whether it's in the Personal Communications Sector, where we produce most of our high-volume handsets, or our Networks
Solutions Sector, where we produce our infrastructure, or the Commercial, Government and Industrial Solutions Sector, where we're trying to provide more
complete integrated solutions to our vertical market customers.
At the same time, we've put into place an Internet and Networking Group in which we've pulled together some of the leading-edge application software capabilities
and services that will be fundamental to really driving this market ... In addition, we're ... focusing on applications and services.
WW: After the loss of the PrimeCo Personal Communications LP contract there had been some criticism about Motorola's software capabilities. Does this address
that in particular?
Gilmore: Yes. Certainly to the extent that the Internet Networking Group will be responsible for defining and developing an architecture and software platform that
will be repeated and reused throughout the enterprise ... We'd be the first ones to admit we had a problem with a very important customer in PrimeCo. We
acknowledged that problem and responded. I think we did so obviously later than the customer wanted. We felt at the time the customer made the decision, that we
were making good progress, that we were becoming equivalent to the other sources for the product they had at that time. It certainly had us focus on our current
product platform. With the customers to whom we are selling that platform today, we've made huge progress in meeting those customers' expectations.
WW: Do you feel that if that situation occurred today that the result might be different?
Gilmore: Yes. I think without question that the products organization has made great strides in dealing with the issues at the core of that situation. At the same, time
I'd like to add that we created a new group within the Communications Enterprise called the Global Telecom Solutions Group. One of the things that we've done
with the Communications Enterprise is that we've created it with its first primary focus being on three very important customer segments. One being consumers; the
other being commercial, government and industrial users of telecommunications and information technology; and the third being the global wireless network operators
of the world.
The focus on the customer is a very key tenet of the new organization. Global Telecom Solutions Group will in fact be an entity that first will provide one voice to
those customers for all of our telecommunications equipment; it will also give us a real focus on those customers.
WW: You mentioned that Motorola has been a technology leader, something that everyone recognized. Can you tell us who the key Motorola people in technology
will be going forward?
Gilmore: Well, I have 12,500 engineers in the Communications Enterprise, and in that group of engineers there are just wonderful people, people who have created
the FLEX paging protocol and made it a de facto standard, created one of the most complex digital communications systems in the world in the [integrated digital
enhanced network] technology, certainly the people who have dreamed up and invented the Iridium satellite system, the ones who are working to create the
Teledesic opportunities for us.
We were one of the very early participants in [global system for mobile communications]; much of the GSM technology is Motorola technology. We've been out
there in CDMA in infrastructure; we've gotten over $6 billion in orders in CDMA infrastructure; we've built three nationwide networks in Japan, one of the most
difficult markets to compete in. That's just going through our major accomplishments.
WW:. You have brought in some stars from the outside, such as Bo Hedfors (former president and CEO of Ericsson Inc.'s U.S. Division, now president of
Motorola's Network Solutions Sector). Do you envision going outside the organization to lure more people of his caliber in the future?
Gilmore: Sure. I think Bo is evidence that we are doing that. He's the most recent and one of the most visible examples. We think he's going to add a very important
dimension to our leadership. We've very happy that not only were we able to find someone of Bo's talent, but also we were very happy that when Bo looked at what
we're doing, he agreed that this was the right place to be.
WW: Let me ask you about 3G. In the standards debate that is going on right now, Motorola hasn't taken a high-profile public position. Is that accurate, and could
you tell me what Motorola's position is?
Gilmore: I think that may be a U.S.-centric view of the participation of the players in the 3G world. 3G is an enormously important and very complex issue for the
global wireless telecommunications industry. We are on record as, one, saying that the 3G standards have got to be customer driven; there are lots of issues out there
in serving those customers, and by customers I mean first, of course, the network operators and also the consumers who will use the 3G systems.
We believe that whatever solutions are put in place have got to be driven by optimizing the benefits to those customer segments. We also have a very diverse, strong
global position with customers all over the world. Certainly we're one of the major players in GSM; we're also one of the major players in [Interim Standard-95]
CDMA. We are on record as saying we would like to see the standards that have been proposed around the world converge; we believe there is enormous benefit
to the global telecom user if the 3G standards could, in fact, converge to a global standard.
But that convergence must be driven by this sensitivity to the customers' needs and to all the [consumers'] needs. There's a huge installed base of GSM in the world,
and there is a growing installed base of IS-95 CDMA and U.S. digital TDMA and other systems of the world. We believe the solutions must be driven by somehow
integrating the best solutions for all those customers.
WW: The debate has come down to a discussion of wideband CDMA vs. cdma2000. Do you see the possibility of these differences being resolved and a
convergence being reached?
Gilmore: I believe the best chance of the global industry seeing that convergence will, in fact, be in the major players, whether they're the network operators or the
equipment manufacturers, and whether they will focus on ... serving customers' needs. If that happens, I believe we will see a convergence. If there are going to be
separate standards with wideband CDMA and [cdma2000], we are on record as saying we will participate in both. We think that because of our position in GSM
and our position in IS-95 we are prepared to do so. We, however, do believe that it would be better for the industry and better for the customer if there would be a
convergence of those standards.
WW: A question about paging. Motorola has always been a dominant force in paging. The paging marketplace is changing. Can you take a look ahead at what's
happening in paging, particularly with narrowband?
Gilmore: In the world of convergence, the sort of solutions that worked in previous situations are changing. We see the functionality of cell phones, pagers and
two-way radios really being integrated and the distinctions blurring between these systems.
To that end you see paging, for example, evolving to instead of just being about alerting people, it is now about messaging, and that has evolved now into two-way
messaging. Once the high-speed capability that leads to robust messaging service after paging, and once this integration of voice and data happens, you can see voice
potentially also being an application for paging. Certainly in developed markets, this sort of narrowband [personal communications services] view of the evolution of
paging will be an important element to paging's success.
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