CTIA: The Wireless Revolution

Outside this year's Cellular Telecommunications & Internet Association's (CTIA) annual trade show yesterday the sun pounded down. Inside, CTIA President and Chief Executive Tom Wheeler pounded away at the message that wireless is staging a "quiet revolution" and that the U.S. government needs to free up spectrum so wireless service providers can deliver on buyers' expectations. Judging from the thunderous applause delivered by the overflowing crowd at the show's opening keynote session, Wheeler was preaching to the choir. During his speech, Wheeler revealed the strides the wireless industry has made in the past few years. "Wireless has moved from an ancillary service to an alternative service," he said, noting that according to a recent Gallup poll, 18 percent of cell phone users consider their mobile to be their primary phone. Wheeler also noted that CTIA expects cell phone penetration in the U.S. to reach 50 percent later this year. To put the importance of that milestone into perspective, Wheeler cited some history: Twenty years after its introduction only .5 percent of Americans had wireline phones, and it took 100 years to get rid of the last party line. Comparatively, he said, more than half of current cell phone users became subscribers in the past four years, during which time about half of the infrastructure- -delivering 96 percent call quality using potentially fuzzy radio waves- -was built. Wheeler went on to discuss the challenges the industry faces. "We must break the hold nineteenth century regulation has on twenty-first century technology," he said, citing the need for government to reconsider recent mandates. He specifically cited local-number portability as one burdensome regulation, originally designed to bring competition to the monopoly wireline arena, but now being applied to the highly competitive wireless industry. "Wireless is the poster child for competition in the telecommunications industry, so why is government imposing monopoly rules?" he asked. Wheeler's final comments focused again on the need for additional spectrum for advance wireless services. "But it has to be the right spectrum to harmonize internationally," he said, citing the importance of global compatibility. Then he closed his speech with a thunderous, "Free the spectrum now." The resounding applause confirmed the audience's agreement. Once the applause died down, Wheeler introduced the first of the session's guest speakers, Nancy Victory, assistant secretary for communications and administrator, National Telecommunications & Information Administration. Showing no mercy, Wheeler asked when the industry can expect the government to release the 120 MHz of spectrum the industry has asked for. "We're still considering how fast we can clear it, how it will be shared, and what would be the cost," Victory replied noncommittally. She implied that it was still uncertain whether any spectrum would be released, though she did seem hesitantly positive that at least some would. (The government is considering reassigning spectrum currently used in both government and commercial sectors.) After grilling Victory further on the spectrum issue, Wheeler relented and complemented Victory on one recent industry win: getting the cap on spectrum lifted by the FCC in January 2003. This is significant for the industry because France, German, Japan, and the U.K have no cap on the amount of spectrum a company can use. The U.S. government, however, currently limits that amount to 45 MHz, which affects the quality of voice service and limits the ability to offer wireless Internet services. Wheeler's other guests included Patricia Russo, president and CEO of Lucent Technologies, who made her debut conference appearance in that role at the CTIA show; Ray Dolan, president of Flarion Technologies Inc., which provides always-on mobile broadband network tachnology; Sky Dayton, president and chief executive of Boingo Wireless, a wi-fi service provider, and founder of Earthlink; John stanton, chief executive of Voicestream; and Ron Smith, senior vice president and general manager of Intel Corp.'s wireless communications computing group. Intel Chairman Andy Grove made a special appearance via wireless GPRS (a high speed wireless packet data service). It was Intel's first live demo of the service.