High-Speed Specialized Wireless Networks May Jeopardize 2.5 and 3G Systems

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NEWS
Issue #2001 - 07 (Feb. 2001)
(Updated on Feb.14, 2001)

MARKET OUTLOOK

High-Speed Specialized Wireless Networks May Jeopardize 2.5 and 3G Systems

A comprehensive look at the future prospects of 2.5G and 3G network operators was undertaken by Alexander Resources.

The firm’s analysis has determined that the viability of current and planned 2.5G and 3G wireless systems may be threatened by new, lower cost, high-speed specialized wireless networks. According to the Dallas, TX-based organization, startups such as Flarion, a spin-off from Lucent Technologies, Tantivy, and SWIFTcom have focused their attention on providing a low cost and efficient service, which are the two most vulnerable areas for the next generation of networks.

Cost Factors
Since these highly specialized networks are only offering data service, they are free from the overhead and operational costs required to support voice capabilities.

Optimized for IP Efficiency
Designed to leverage and support high-speed data and IP traffic, the specialized networks can take advantage of the following:

Higher cell capacity
Lower latency
Faster transmission time
Lower cost terminals
Lower cost infrastructure
Self-configuring base stations
Network scalability

Alexander Resources addresses these issues and others in two new business seminars:

"Making Money in the U.S. Wireless Internet Market" addresses the challenges and opportunities, strategies and tactics to generate significant profits and revenues in the U.S. wireless Internet market.
"3G Wireless: Promises and Realities" offers an objective and critical look at 3G wireless networks and services, from the standpoint of the customer, marketplace, and political realities.

For more information: www.alexanderresources.com/reports/3G-report-outline.html

Mobileinfo Comments and Advisory: While we respect Alexander Resources research, we are not sure that all the factors have been considered in making these projections of becoming a potential threat to integrated wireless voice-data networks. It is not just neat and innovative network technology that will win the race in 3G and 3G+ space. Building pure data networks may introduce efficiencies in one sense, but you miss out on a relatively assured voice market that has seen significant growth recently. Pure wireless data networks have a good future but the network providers will have to wait it out. Return on their investment will come but only after three to five years - the operators should have deep pockets and long staying power. Also, specialized networks, if they are small, will have serious problem about interfacing to IT infrastructure, including wireless servers, WAP gateways and application servers. Planners must understand that wireless network is only one of the many components (albeit an important component) that deliver value to the enterprise. Notwithstanding these comments, we feel there is a place for wireless data only networks and that well-aligned operators with well-designed messaging applications will have some success in certain vertical markets. Convergence of data and voice, we feel, is a bigger trend than specialty data-only networks. Ultimately, dynamic assignment of channels and bandwidths with priority scheme and different charging algorithms for two information types is the answer. We think that we shall get there in post 3G time frame.

Note: This news release may contain forward-looking statements. Readers should take appropriate caution in developing plans utilizing these products, services and technology architectures.

All trademarks used in this summary are the property of their respective owners.

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