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To: william i smith jr who wrote (23804)	3/6/1999 1:04:00 PM
From: Ruffian	Respond to of 152472

Forecast, TDMA> From the March 8, 1999 issue of Wireless Week MOU Forecast To Quadruple By Brad Smith A major shift is going to occur in the U.S. wireless industry over the next few years. Subscriber growth will slow but minutes of use will skyrocket, according to the "Wireless State of the Union" report by the Yankee Group. The industry still will see strong subscriber growth, climbing 30 percent to 35 percent from 1998 to 2003, the report said, but MOU will quadruple over the same period of time. "Clearly that's going to result in significant displacement of landline minutes," said Yankee Group Senior Vice President Mark Lowenstein. He said the number of wireless subscribers reached 67 million at the end of 1998 and will grow to 81 million this year, reaching 30 percent of the U.S. population. More than half of the U.S. population will subscribe to wireless service by 2007, he said. At the same time, subscribers used an estimated 107.7 billion minutes last year, the report said. MOU will increase this year to 168.4 billion and to 482.7 billion in 2003, according to the report. Lowenstein said the Yankee Group revised its forecasts for growth among the time division multiple access and global system for mobile communications carriers in the United States. The analysts increased their estimate for TDMA subscribers because of the overwhelming success of AT&T Wireless Services Inc.'s Digital One Rate plan while lowering their estimates for GSM because of the uncertainty about a nationwide footprint. GSM's footprint could change this month depending on the upcoming FCC spectrum auction, he said. He said code division multiple access carriers, especially Sprint PCS, have been held back in their growth because of the lack of a wide range of handsets. That will change in 1999 with the introduction of several new handsets, leveling the playing field, Lowenstein said. The research group also expects there will be major changes in roaming in the coming years. "I predict in two or three years we won't even use the term roaming," Lowenstein said. Roaming is becoming less of a factor among the nationwide digital carriers and even some regional carriers, he said, although there will remain some resistance from the smaller cellular carriers that earn a major portion of their revenue from roaming fees. Lowenstein said there likely will be a new wave of roaming agreements negotiated between analog and digital cellular carriers as they compete for minutes from carriers such as Sprint PCS and PrimeCo Personal Communications LP. Carrier capital spending also is going to undergo a major shift, the report said, from a network buildout phase to increasing capacity on the network. In 1997, carriers spent 85 percent of their infrastructure money on buildout, but by 2002 about 80 percent of infrastructure spending will go toward capacity. This year will see flat subscriber growth numbers for analog networks, the report said, and analog will start declining at a compound annual rate of 16.4 percent through 2007. Yankee Group analyst Crispin Vicars said mobile data will start to become a reality in 1999, mostly because of the push it is getting from the vendor community. "We haven't seen a lot of demand on the end-user side, but we believe that demand will increase," Vicars said.