CELLULAR TECHNOLOGY

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· Introduction Today's rapidly changing business environment is creating intense competition among corporations. Markets are changing faster now than in any other time in history. Product life cycles are shortening and businesses must compete globally (Wheelwrite & Cl ark, 1992). Employees are required to spend more time with their external and internal customers in order to increase the competitiveness of their organizations. As a result, employees are often away from their phones. Approximately 48 Million employees spend over 20% of the workday away from their desks, and this number is likely to grow (DeBelina, 1995). Telecommunications analysts predict that the existing global wireless telecommunications market is expected to grow from 40 Billion dollars in 1993 t o 200 Billion by the year 2000 (Cauley, 1995). Today's market conditions therefore require that managers evaluate cellular technology as an alternative to traditional wireline telecommunications services to make their corporations more competitive. Since today's cellular network coverage reaches about 95% of the population (Gareiss, 1995), cellular service is a ubiquitous method of providing wireless service to employees on the move. Whether the employees are field engineers accessing databases, orderi ng products, and retrieving technical specifications or off site sales staff responding to customer inquiries, deploying cellular technology will increase an organization's responsiveness making it more competitive. This research paper describes cellular technology, competing technologies, applications, life cycle phases, cost considerations, hardware and software requirements, strengths, weaknesses, opportunities, and threats (SWOT) found in cellular technology. T hroughout the paper, the author will make recommendations on how to incorporate cellular technology in their organizations. Cellular Networks and Access to Public Networks Cellular networks consist of cellular base stations, mobile telephone switching offices (MTSO), and mobile communication devices. Each base station contains a radio transceiver and controller and provides radio communication to the mobile units located in its cell. The cells are arranged in a honeycomb pattern in order to provide local, regional, or national cellular coverage. The MTSO links calls together using traditional copper, fiber optic, or microwave technology and acts as a central office excha nge allowing users to place a call on the local and long distance public telephone systems. It also allows mobile communication devices in the cell to dial out and alerts devices in the cell of incoming calls. The MTSO continuously monitors the quality of the communications signal and transfers the call to another base station which is better suited to provide communication to the mobile device. The mobile communication devices consist of hand held phones, car phones, notebook computers, personal digital assistants, pen-based computers, palm-top computers, and portable data collection devices. Since only two percent of the cellular traffic is d ata, the most popular mobile units are cellular telephones (Gareiss, 1995). When these mobile units communicate to the network, they must register with the system by subscribing to a carrier service. Most carrier services have arrangements with other pr oviders allowing users to roam. Roaming occurs when the mobile unit is outside the coverage of their cellular service provider and an alternative cellular provider places the call. Cellular technology extends the bounds of a corporation's existing telecommunications infrastructure by connecting mobile units to the public network operated by the local exchange or long distance carriers. The cellular users have special features an d functions specific to cellular customers but they can also use the features and functions of the public phone systems. This allows cellular technology to be flexible enough to take advantage of features and functions of almost any public or private net work. Fundamental Concepts in Cellular Technology The radio spectrum contains many bands that are allocated and used for commercial, personal, and military applications. Fifty (50) MHz of spectrum allocated to cellular networks exists in the 824-849 MHz and the 869-894 MHz bands (Pagett, 1995). These bands are then further subdivided into 832 channels allowing many users in the same area to simultaneously access the network (DeBelina, 1995). Types of Cellular Network Access The types of network access in the United States are advanced mobile phone systems (AMPS), time division multiple access (TDMA), and code division multiple access (CDMA). AMPS is the cellular standard that has been extensively deployed in North America and has been commercially available since 1983 (Khan & Kilpatrick, 1995). The current cellular standard describing access methods to the network is IS-553 and divides 50 MHz of spectrum into 832 frequency channels, each 30 KHz wide (Amin, 1995; Pagett, 1 995; Pagett, Gunther, & Hattori, 1995). Organizations such as the Portable Computer and Communications Association (PCCA) consist of modem manufacturers, computer manufactures, and service providers work together in defining the IS-553 interoperability s tandard (Khan & Kilpatrick, 1995). Time Division Multiple Access (TDMA) is a digital access method that allocates time slots to different users allowing them to share similar radio frequency channels. TDMA divides each frequency channel into six time slots and allocates two slots to each user increasing the network capacity by 300% (Pagett et al., 1995). Standard IS-54 describes a dual mode network access method allowing mobile units the choice of using TDMA or AMPS operation (Amin, 1995; Honig & Madhow, 1990; Khan & Kilpatrick, 1995; Tawfik, 1993; Sasaoka, 1993; Williams & Ong, 1995). Code Division Multiple Access (CDMA) sends multiple messages over a wide frequency channel that is decoded at the receiving end. Each mobile unit in a cell is assigned a different spreading sequence and allows multiple users to share the same frequency spectrum improving network capacity over the AMPS systems by a factor of ten (DeBelina, 1995; Pagett et al., 1995; Pagett, 1995). The details for CDMA network access are referenced in standard IS-95 which describes the mobile unit's access to the cellula r network (Honig & Madhow, 1990; Khan & Kilpatrick, 1995; Sasaoka, 1993; Williams & Ong, 1995). Although TDMA and CDMA digital access methods are just starting to be deployed in the United States (Tawfik, 1993), this author believes these access methods will become widely deployed because of their superior performance characteristics. These networ ks have a higher capacity, improved voice quality, encryption for communication privacy, and integration with digital terrestrial networks (Padgett, Gunther, & Hattori, 1995). Digital access has its advantages, but it does not have the ubiquitous access that AMPS systems have (Amin, 1995). Therefore, to take advantage of the widely available coverage of today's cellular services, portable units need to be compatible with the analog AMPS systems. Growth Phase and Life Cycle of Cellular Technology This author believes that the cellular industry is in its growth phase. Michael Porter (1980) explains that products go through the introduction, growth, maturity, and decline phases of their product life cycle. Some characteristics of the growth phase of Porter's life cycle model are large growth in use, widening of the buyer group, improved reliability and competitive product improvements, increased advertising, increased channels of distribution, and high profit margins. These characteristics are a ll occurring in the cellular industry. Currently, there are 26 million cellular customers growing at a rate of approximately one million new customers every month (Amin, 1995). There is a widening buyer growth that is extending into vertical markets suc h as service, logistics, and home office (DeBelina, 1995). System reliability has improved greatly providing high quality services to cellular users (Pagett, et al., 1995). There are many competitive product improvements such as digital technology advanc ements, voicemail, call forwarding, encryption, and enhanced battery life (Lee, 1993). There is a great deal of advertising for cellular products on television, radio, print, and on the Internet. Alternate channels of distribution for cellular phones an d services are also becoming popular. For example, retail office supply, electronic, and computer chains are actively marketing cellular phones and services. Additionally, cellular services have high profit margins. This author hypothesizes that the cellular growth phase will last another two years because industry analysts predict that it will take that long for PCS services to be operational (e.g., Thyfault, 1995). PCS will capture most new users and cut into the cellular market because PCS has price performance advantages over cellular technology. PCS will offer higher bandwidth communication and more features at lower prices (e.g., Nadik, 1995; Perry, 1993; Raychaudhuri, 1995; Raychaudhuri & Newman, 1992). Al though this author believes PCS will enter the growth phase when cellular enters the maturity phase, many telecommunications analysts believe the two will seamlessly interoperate with one and other's equipment (e.g., Nadik, 1995; Cheung, Beach, & McGeehan , 1994). Cellular network providers are even buying PCS licenses to increase their "footprint" indicating that a PCS/cellular service is part of cellular providers' strategies (Amin, 1995). For example, 18 different companies spent over 7 Billion dollar s for PCS licenses (Dale, 1995). The largest winners of the PCS auctions were cellular companies such as NYNEX, Bell Atlantic, and McCaw, who increased their service area to create new forms of revenue.