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More than mere talk

Until recently, 3G has been just a whisper. Has it learned to speak?

You’re taking a cab back to your hotel after a day with clients. Stuck in traffic, you use your video phone to conference with the home office, then download information from the corporate database for a meeting later in the evening. Knowing your client’s fondness for French cuisine, you search the Web for a bistro close to the hotel online and make reservations. A coupon on the site lets you pay for the meal on the phone while reaping a substantial discount. You think, “This ought to make the bean-counters back home happy.” Plans made and reports completed, you call your wife. It’s always so good to see her face. She sends you a brief video clip of your young son curled up with the kitten. Not quite as good as being home, but it’s better than the static picture in your wallet.

This is just part of what the 3G revolution promises. Music, video, and even karaoke on demand–along with interactive games–are some of the fun stuff in our future. E-mail, short messaging services (SMSs), and unified messaging are some of the fun stuff in our present. Our personal security already is enhanced with this new system through global positioning systems (GPS) that can find us when we’re in trouble. Emergency personnel will reach victims more quickly, and the video and data feeds will allow better supervision of treatment in the field.

“3G will transform the telecommunications industry,” says Ira Brodsky, president of Chesterfield, Mo.-based DataComm Research. “For the operator it means almost doubling capacity at a reasonable cost while adding new revenue streams. For the customer it means more services, faster speeds, and lower costs.”

Other experts take a more cautious approach. “The U.S. wireless industry has taken a lot of well-deserved knocks, but there is an opportunity right now, if we can seize the day,” says Robin Hearn, North American regional director of advisory services at London-based Ovum Research. He is also the co-author of a 135-page study on 3G, titled “Third Generation Wireless: Business Models and Strategies.”

It sounds great, but is this just “The Jetsons,” a cartoon of a future that may be feasible technically but not economically? Or is it the genesis of a new order that will reshape the way we do business by delivering the world in the palm of your hand?

The 3G promise

3G stands for third-generation mobile phone technologies. 3G means transmitting high-speed data anytime, anywhere through a cell phone, PDA, or information appliance, wirelessly and from any location. 3G means freedom from wires.

It’s that freedom that has the business community panting with anticipation. The possibilities are endless. A salesman meeting with clients over lunch can get immediate access to the prices and availability of the products he’s pitching. Corporate executives can remain in constant touch with colleagues through remote access to intranets and LANs. Service personnel will have more information available, which means fewer visits to fix a single problem.

Some of the most impressive applications will come in health care. Imagine if emergency personnel on the scene of an accident could transmit a picture of the injury back to the physician at the hospital, or even to a specialist who’s flying at 40,000 feet in a plane that is 5,000 miles away.

Will wireless replace your T1 line? Not a chance, but it will give you the opportunity to get the basic data to the right people exactly when they need it. “The mobile phone is a communications device; it’s not an information device,” notes Hearn. “You can get information over it if you need to, but there are better ways of doing that [when it’s possible].”

The challenges

The biggest problem for wireless transmission is the cost. “Radio access is inherently expensive,” says Hearn. “That is, it’s more expensive than fixed access, and it will always be.”

Although some solutions are less expensive than others, they all cost more than using already installed twisted-copper pair cabling. In Europe more than $120 million was spent just for the frequency spectrum licenses needed for a future 3G system. Getting spectrum resulted in a significant delay in the deployment of 3G.

The efficiency of 3G systems has also been questioned. Some say that unless huge amounts of money are spent, a real-world throughput of only about 60Kbps can be achieved. Questions about security have also been raised.

Handsets have become another stumbling block, according to skeptics. Current handsets typically have only about 2MB of flash memory. This means that for sophisticated applications, the network will have to do most of the heavy lifting. The result may be spotty coverage and slowdowns in data transmission.

And even if all the technical challenges are met, will people want these services? If so, at what price? There is a growing sense in the analyst community that mobile data services for consumers will not grow as mobile voice services did. Business users may be a more lucrative market, however.

The standards battle

One of the biggest problems standing in the way of a 3G build-out is the confusion over standards. Currently, there are several protocols fighting for respect: Time Division Multiple Access (TDMA), Global System for Mobile communications (GSM), Code Division Multiplexing Access (CDMA), and Wideband CDMA (WCDMA).

TDMA, which mainly uses frequency in the 800MHz and 1,900MHz bands, was the first protocol used when wireless carriers began converting from analog. Although it initially appeared to be the answer, most now see TDMA as being DOA (as in dead on arrival) when it comes to data. The main problem is the cost and difficulty of upgrading TDMA systems to handle high-speed data transmissions. If there is any doubt about TDMA being a dead end, just ask AT&T. It is spending an estimated $5.5 billion to back out of its original decision to go with TDMA and upgrade to a more robust 3G system.

GSM is still in the game, but many see it as a legacy environment that cannot stand up to the demands of the future high-speed data world. But GSM, the standard cell phone technology in Europe, is getting a push from Deutsche Telekom, which has acquired VoiceStream, the leading GSM provider in the United States. It generally operates in the 900MHz and 1,800MHz bands.

The CDMA buzz

Currently, the various flavors of CDMA appear to be the rising stars of the available protocols, thanks in part to its spread-spectrum quality. One reason is that as a user roams between cells, signal hand-off is somewhat smoother with CDMA than it was with older technologies, meaning fewer dropped calls as you travel. Additionally, CDMA exhibits more flexibility when handling data.

The CDMA2000 push

Although it currently has some speed limitations, CDMA2000 is getting the most attention within the wireless industry. CDMA2000, which is actually an upgrade of CDMAOne (the original specification), provides high data transmission speeds, flexibility, and a relatively low-cost of deployment. At present, the peak speed of CDMA2000 is 144Kbps. A planned software upgrade will take this peak speed to more than 300Kbps, and that’s only the start. According to Brodsky, Qualcomm has demonstrated what it calls High Data Rate (HDR), which is planned to be folded into the CDMA2000 specification. Known as CDMA2000-DO (the DO stands for data only), it will bring the peak speed of CDMA2000 to 2Mbps.

“Because of its flexibility, CDMA2000 systems will reach 25 million subscribers by the end of 2002,” Brodsky notes. “We [DataComm] predicted years ago that CDMA would drive TDMA, which was the industry standard, out of business, and that’s exactly what has happened.”

WCDMA, which is used mainly in the 2,100MHz band, seems to have it all: high transfer rate (up to 2Mbps), increased system capacity, and communication quality by statistical multiplexing. Unfortunately, it also has a couple of big disadvantages: high cost of deployment and some serious spectrum worries. An April 2001 report from the Federal Communications Commission, titled “The Potential for Accommodating Third Generation Mobile Systems,” says that some of the airwaves initially identified as usable for WCDMA are already in use by the U.S. Defense Department, fixed wireless cable and video services at schools, and health care centers. According to the report, it could take anywhere between nine and 29 years to reallocate the airwaves to accommodate the deployment of 3G wireless. An even bigger concern, notes Brodsky, is bandwidth. “WCDMA was defined to require a minimum channel of 5MHz, which is almost as wide as that of a TV channel,” notes Brodsky. “In most cases, that means a new frequency spectrum.”

Supply …

3G services will vary depending on where in the world you are. “The regional mix will be half and half in Europe, Asia-Pacific will be more consumer, and in the United States and Canada, it’s going to be much more enterprise- or business-focused,” says Hearn.

Verizon Wireless hopes the American business community will embrace wireless. In January 2002, it became the first major carrier with a 3G wireless network with the launch of its Express Network. Although initially available only in a limited geographical area–greater Salt Lake City, a corridor running from Portland, Me., to Norfolk, Va., and the San Francisco/Silicon Valley area–the company has major expansion plans.

“We will continue expansion of the Express Network, and by the close of 2002, the majority of the nearly 222 million covered POPs [points of presence] should be able to use it every day,” said Verizon Wireless chief technical officer Dick Lynch.

Other major carriers are not far behind. Sprint PCS plans to launch its nationwide 3G network in June or July of this year. AT&T hopes to inaugurate its 3G system by the end of the year.

… and demand

If 3G is to succeed in the United States, it’s going to have to be a success with and for business. That means two things: first, 3G rollouts are going to have to produce the speed and efficiency they claim in their advertising; and second, businesses are going to have to figure out how to make the systems productive enough to justify the additional cost.

If enterprises try to jam their entire company databases, pages of graphics, and video clips of the company picnic down the narrow pipe of wireless, it’ll be like trying to fit a camel through the eye of a needle. As companies learn that mobile data has to be specific data, the demand for wireless connections will grow. As it grows, so will the capabilities and speed of the system.

“It’s about interactive communications, not a one-way drag of information,” says Hearn. “Forward steps are being made, but with the U.S. wireless market there are also a few steps back. It’s never as simple as it could be, or it should be.”

3G handsets

Since 3G is not yet available throughout the country, very few 3G phones can be found. A recent trip to the local AT&T Wireless store revealed that although many phones are called “Internet-ready,” there was only one phone in the store, an Ericsson R 289 LX, that could be considered 3G.

But that won’t be the case for long. As 3G networks are deployed across the country, equipment will soon follow. The Verizon Wireless Express Network is already operational in several areas and should be available nationwide by the end of the year. Sprint PCS plans to launch its 3G network in June or July, and AT&T intends to have its network available by the end of the year.

Once 3G is widely deployed, a host of cool gadgets will be available. One of the most intriguing is the Geode Origami Mobile Communicator from National Semiconductor. This space-age device would make Mr. Spock jealous. It incorporates a digital camera, digital camcorder, Internet access device, e-mail terminal, Internet picture frame, MP3 player, and smart phone in single package. Current models are not yet 3G-capable, but that is expected to change once 3G networks are widely available.

Ericsson has a concept phone that’s as much a piece of art as it is a functional communication device. It includes a digital camera, a phone, Internet access capabilities, and a detachable keyboard.

From Samsung comes the IMT2000 concept phone, which will let you send and receive video as well as make conventional phone calls. More phones and devices will soon be available from Nokia, Motorola, and Sony.

If you need access to a 3G network now, take a look at the AirCard 555 from Sierra Wireless. This PCMCIA device is fully compatible with the Verizon Express Network and allows you to add voice, circuit-switched data, and short messaging service capabilities to a laptop, PDA or any device with a PC-card slot.

As the different networks come on-line, their respective retail stores will begin to offer compatible handsets. But expect bumps in the road. Early adopters will experience the sorts of frustrations anyone gets when first in line for a new technology. Businesses and consumers should also look for dual-band phones so that when the latest technology is unavailable they can still make a call on the older protocols.

If you’re like us and want to drool a bit over the future, check out the 3G Generation site. It has some excellent pictures from all the major vendors of what’s coming next.

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