Commercial Market

New FCC Filings Outline Expanded SPACEWAY System

Hughes Communications Inc. has filed two new applications with the Federal Communications Commission (FCC) to enhance its SPACEWAY™ global broadband communications system by increasing overall system capacity and adding higher data rate transport services. The SPACEWAY EXP™ filing proposes high data rate transport services with an eight-satellite constellation operating in geostationary earth orbit. The SPACEWAY NGSO™ filing describes a 20-satellite constellation in nongeostationary earth orbit. Both systems will operate in the Ka-band frequency range.

The global SPACEWAY system will provide coverage in North America, Asia-Pacific, Latin America, Europe, Africa and the Middle East, and allow access to terrestrial networks, such as the Internet, Intranets and local area networks. The system will use receivers with antennas as small as 26 inches in diameter and provide uplink speeds up to 6 Mbps. Service is expected to begin in the first region in 2001.

SPACEWAY EXP will emphasize the high data rate transport market with geostationary satellites operating in four orbital locations. SPACEWAY NGSO will increase the overall SPACEWAY system capacity and provide interactive broadband multimedia communications services in high traffic markets. A wide range of broadband data rates will be provided by its constellation of five satellites in each of four planes inclined at 55° with respect to the equator and in circular orbits at an altitude of 10,352 km. SPACEWAY satellites will employ multiple beam antennas and digital processors for switching traffic among the beams or to another satellite via intersatellite links.

Asia-Pacific Region Forecast to Become Largest Wireless Market

In its report, "Asia-Pacific Cellular/PCS Markets: 1997," The Strategis Group finds that the strong demand for cellular and personal communications services (PCS) in the Asia-Pacific region has moved the region ahead of both North America and Western Europe, making it the world's largest market for those services. The report forecasts a total subscriber base in the Asia-Pacific region of 100 million by the end of this year, growing to 221.5 million by 2002. By comparison, the North America market is expected to reach 75 million subscribers by the end of this year and grow to 100 million by 2002. The Western Europe market also will grow to approximately 75 million and 150 million, respectively, during the same periods.

The migration to digital service is expected to continue in the Asia-Pacific region. Approximately 72 percent of subscribers who were on digital systems at the end of 1997 are expected to account for 92 percent of the total by 2002. Japan's personal digital cellular (PDC) standard was used most widely in 1997. The report also forecasts that the success of code-division multiple access (CDMA) IS-95 in South Korea and Hong Kong and its planned deployment in Japan and China will lead to the systems gaining a large share of the market eventually. By 2002, the Global System for Mobile communications (GSM) 900/1800 standard is expected to lead the region's market with 35 percent of the subscriber base. CDMA and PDC are forecast to account for 24 and 17 percent of the market, respectively.

More than two-thirds of the region's subscribers were based in Japan (50 percent) and China (18 percent) at the end of 1997. Rapid growth is forecast for China, India and Vietnam during the next few years. Japan is expected to remain the leading market in 2002 with China closing the gap. The cellular/PCS growth rate in the region as a whole is forecast to remain at 20 to 40 percent per year through 2001 and fall to 16 percent in 2002. For additional information, contact Mei Huang at The Strategis Group (202) 530-7500, fax (202) 530-7550.

Study Shows PCS Leads Cellular in Customer Satisfaction

J.D. Power and Associates has released a study, "Analysis of Personal Communications Services," which covers 18 markets throughout the US. In-depth examinations were conducted of three of the 18 PCS-dominated markets to determine the impact of increased competition in the wireless industry. The report finds that overall customer satisfaction levels for PCS providers are significantly higher than those for cellular carriers. Call quality, corporate image/credibility and flexible pricing are key strengths of the PCS providers while geographic coverage and roaming service are weak points because the technology is not fully deployed.

Compared to 1996 findings, PCS carriers in the San Diego and Washington/Baltimore markets have replaced cellular providers as customer satisfaction leaders. Eight out of 10 respondents who have switched to PCS are more satisfied than they were with cellular service.

Typically, the emergence of a PCS company in a market stimulates the demand for wireless services. The new entry usually captures one-third of new customers and prices in the market are reduced by 10 to 20 percent. The increased price-driven competition, choice of technology and availability of new products lead 25 percent of wireless and cellular customers to express an inclination to change providers.

Currently, one-third of US households subscribe to a wireless service and participation is expected to increase to 40 percent by the end of this year. New service providers using the latest technology and offering aggressive prices are expected to capture a large share of that market. For additional information, contact J.D. Powers and Associates at (203) 291-3208.

European Next-generation Wireless Standard under Development

Motorola Inc. has announced that it is working with Siemens AG, Alcatel, Bosch, Italtel and Nortel to develop a next-generation wireless standard for Europe that combines key elements of both CDMA and time-division multiple access (TDMA) cellular technologies. The announcement confirms Motorola's support of the next-generation wireless standard proposed by Siemens. Motorola and Siemens will cooperate in the development of the new standard for Europe's Universal Mobile Telecom System (UMTS) based on the proposal submitted by Siemens to ETSL, the European telecommunications standardization body.

The proposed standard, FRAMES 1B, uses CDMA signal-spreading techniques to enhance the capacity of conventional TDMA technology. Digitized voice and data are transmitted on 1.6 MHz channels using time-segmented TDMA technology. Each TDMA channel time slot is coded using CDMA technology and supports multiple users. The new standard is designed to provide a cost-effective and easy transition from GSM to UMTS and to support the use of low cost, dual-mode GSM/UMTS handsets.

New Rear-view Mirror Offers Communications Capabilities

Johnson Controls, developer of the AutoLink" intelligent communications technology, and HighwayMaster Corp., operator of a private enhanced-cellular network, are offering an electronically enhanced rear-view mirror that can be used to summon roadside assistance, obtain directions and receive messages. The AutoLink-based device links vehicles to a national network that can provide roadside help, emergency response, Global Positioning System navigation support, theft notification, vehicle diagnostics, remote unlocking help, Internet access, and interactive messaging and information services 24 hours a day. Automotive mirror supplier Gentex Corp., Zeeland, MI, is manufacturing the mirrors.

Drivers or passengers can activate the communications functions by voice command or by pressing buttons on the face of the mirror. The device also displays compass and outside temperature readings. The mirror is scheduled to be offered at retail cellular communications outlets beginning in September. Buyers will be required to pay a monthly network service fee in addition to the purchase price of the equipment, which is estimated at $750.