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Wireless pact first step to global standard
By John Borland
Staff Writer, CNET News.com
March 25, 1999, 12:20 p.m. PT
news analysis Today's deal between competitors Qualcomm and Ericsson could
smooth the rocky path toward a worldwide standard for new wireless phones,
according to industry insiders.
Third-generation wireless technology, often dubbed 3G, will offer users high-speed Internet
capabilities and new voice services over mobile phones. But the drive forward had been
slowed by what some analysts have called a "holy war" between the two companies.
Each company has supported a different version of a wireless technology called CDMA
which, until today's agreement, appeared to be largely incompatible. Making matters
difficult, Qualcomm has held intellectual property rights in the CDMA technology that it
refused to license to its rival, throwing the future of the wireless standard into doubt.
On its face, today's agreement between the two companies appears to eliminate most of
those hurdles, although significant technical details still remain.
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The two companies will jointly support a single "family" of standards, which they say will
allow worldwide use of the next generation of mobile phones. That has been a key goal for
much of the wireless industry, which is split between a number of incompatible
technologies.
Ericsson's purchase of Qualcomm's infrastructure division also will add a new competitor in
the existing CDMA phone world, which could eventually translate into lower prices for
users, some industry insiders said.
"This is a red-letter day on the calendar that will go down in wireless history," said Craig
Farrill, vice president of strategic technology for AirTouch Communications.
But today's truce between the wireless world's biggest antagonists doesn't necessarily
mean an end to the third-generation squabbling.
The new "family" of CDMA standards will provide an upgrade path for today's GSM and
CDMA phones, which together make up a majority of wireless users worldwide. The next
generation of phones using this standard will continue to support both of these separate
technologies, the companies said.
But a third incompatible standard, TDMA, remains outside
the scope of the newly formed club. While it is used by a few
companies worldwide, it is the primary technology across
Latin America, for the U.S.-based AT&T wireless service, and
other large operations in Canada, East Asia, and Eastern
Europe.
"We're back to the religious wars, but with different players,"
said Ian Gillott, an IDC wireless analyst.
That dispute may also work itself out by November, when
standards bodies will determine a final third-generation
standard. The TDMA backers have made moves to work
together with GSM manufacturers, and some analysts even
think the three camps will eventually reach a larger
agreement.
Analysts also note that Qualcomm's and Ericsson's new single-standard rhetoric does
little more than link their formerly competing standards together into a "family," and clears
the path for a single wireless phone that can support both
"No matter how you look at it, it's still in effect going to be three standards," noted Elliot
Hamilton, director for U.S. telecommunications consulting for the Strategis Group. The
"single standards" will simply involve a more complicated phone that is able to switch back
and forth between the three "modes," he said.
The rapprochement between the two feuding companies will make carriers' life easier, and
likely speed the rollout of the technology, Hamilton added
"We're really quite thrilled by this announcement," said Jonathan Marshall, a spokesman
for AirTouch Communications, one of the biggest international wireless carriers. AirTouch
and its new merger partner, the U.K.-based Vodafone, have been among the chief backers
of a truce between the various CDMA standard camps, since the new company supports
both technologies.
"The most important thing is that we'll be able to move forward and get a standard without
the threat of lawsuits and companies withholding their intellectual property," Marshall
added.
Marshall said the agreement would likely translate into lower prices for consumers down
the road, since a single phone standard--even a three-mode version--would allow
manufacturers to take advantages of economies of scale.
But Gillott warned that the price effect would likely not be substantial. "This stuff is going
to go down from bloody expensive to expensive," he said.
Third-generation technology is expected to reach the market in late 2000 or early 2001.
Related news stories
• Wireless standard fight sent back to firms March 19, 1999
• War over the world's wireless future March 8, 1999
• Wireless CEOs target standards battle January 26, 1999
• Battle over wireless standards heats up January 22, 1999 |
