The road to launching the first commercial personal communications services network in the United States, which American Personal Communications plans to do this fall, began at the Personal Communications Industry Association (then called Telocator) annual convention in Washington, D.C., in 1989. It is fitting that APC is on the verge of launching its system six years later as PCIA again meets for its annual convention.
Back in 1989, the concept of PCS was virtually unknown in this country and I was intrigued by a presentation on a European-based technology called CT2 (cordless telephones, second generation) and a more robust concept called personal communications network, which is what the United Kingdom calls its new-generation wireless service.
Since I had been “present at the creation” of the cellular industry in the 1980s, the idea of an all-digital service with lighter, cheaper handsets and a lower overall cost structure was appealing to me.
After considerable due diligence, we founded American Personal Communications in November 1989-just a few months after my first introduction to the concept of PCS.
Finding spectrum
The most daunting challenge facing PCS advocates in 1989 was finding a spectrum home for the service. The British government had adequate unallocated spectrum to set aside for new wireless services, but that was not the case in the United States. Due to our robust array of private radio communications systems, there was virtually no vacant spectrum below 3 GHz.
In the 2 GHz band identified for PCS by the United Kingdom, and eventually the World Administrative Radio Conference, the United States had established numerous private fixed microwave systems. The first take on this band was that it was off-limits to PCS. APC, however, decided to look a little harder at the situation.
In what became one of APC’s most significant contributions to the development of PCS, its engineers conducted an exhaustive survey of the thousands of private microwave links licensed here. What we found were significant “holes” in the microwave spectrum allocations-spaces where no microwave links were operating and where it was feasible, assuming one could solve the interference problems, to locate PCS. Armed with this information, we petitioned the FCC to consider the 1850-1990 MHz band as a potential home for PCS.
We kept working on the interference problem, however, and eventually developed a frequency-sharing algorithm that would allow PCS operators to identify-and engineer around-microwave links in specific PCS markets. Our work on this technology, which we call PathGuard, eventually led to a government patent and to licensing and production agreements making PathGuard available to every PCS operator in the country.
A further step in finding a PCS spectrum home was fashioning a relocation strategy for those 2 GHz microwave links. The goal was to encourage owners of the microwave systems to move to a higher portion of the spectrum, clearing 1850-1990 MHz for PCS. Working with PCIA and others, the Federal Communications Commission adopted a microwave relocation plan that APC favored and created a framework for relocation and introduction of PCS.
Spectrum disputes
Another stumbling block in the early days of PCS development was a dispute over how much spectrum should be allocated to PCS licensees and how large their markets should be. APC argued for both large spectrum allocations and large markets. Our name for the envisioned concept was “big PCS,” to differentiate from opponents who, we felt, attempted to marginalize PCS by allocating it too little spectrum and small markets.
Our position was simple, and it remains a cornerstone of our efforts to launch service as soon as possible: the wireless market is tough to crack because of the 12-year head start by cellular carriers protected from effective competition by their “shared monopoly” status. Therefore, to be successful PCS needed an adequate spectrum allocation to overcome the problems of sharing frequencies with the microwave systems and large markets to generate enough income to offset huge start-up costs.
The FCC eventually allocated two 30-megahertz licenses in 47 large major trading areas across the United States.
Keys to PCS success
APC plans to be the nation’s first operating PCS carrier because we’ve been at it longer than anyone else, ever since our founding in 1989 and receipt of the first experimental PCS license in 1990. We received a pioneer’s preference for licensing, which meant we did not have to participate in the spectrum auctions of late 1994 through early 1995.
We think success in the PCS marketplace will come to those who concentrate on the following principles:
Recognizing the importance of speed to market. APC has never underestimated the tremendous advantage existing wireless companies have with their large customer bases, established infrastructure and well-honed marketing schemes. Every minute since the launching of PCS became certain was another minute for entrenched players to shore up market positions. PCS players can’t give the competition any more time than absolutely necessary.
Establishing brand identity. We feel one key to cracking a market 12 years after our competitors entered it is to offer a recognizable brand name. APC is fortunate to be teamed in the Washington, D.C.-Maryland-Northern Virginia market with the Sprint Telecommunications Venture. We will offer service under the Sprint brand name, which places us on an “at par” basis with our competitors. “Wayne’s PCS Service” would not suffice.
Offering superior products. Some of that superiority will come from the advantages of digital transmission over analog: clear calls free from static and dropped calls, plus the security that comes from knowing calls cannot be intercepted.
Relationships with top wireless communications vendors also are imperative. Our infrastructure is being supplied by L.M. Ericsson and Northern Telecom Ltd. Our initial handsets will come from Nokia Corp. and Ericsson. All these vendors are recognized for excellence throughout the world.
Providing excellent customer service. The days when customers could be taken for granted are long over in the wireless business just as in any other aspect of U.S. business. Customers want action, simplicity, reliability and honest results.
APC’s performance
How have we lived up to these principles as we have evolved from a hungry start-up enterprise to a maturing company with approximately 200 employees in our Bethesda, Md., headquarters and Maryland and Virginia switching centers? Speaking as chairman, I think the answer is, “Pretty darn well.”
Take the speed to market question. In an approximately 18-month time period, APC acquired more than 400 base station sites throughout its service area and has secured zoning approval for more than 300. Compare that with our cellular rivals, who have less than half that number of cell sites after 12 years of existence.
We have put in place fully staffed sales, engineering, operations, marketing and customer care operations, along with administration, legal and human resources departments.
We are looking forward to testing our vision and our people in the marketplace in a very short time. By the time of PCIA’s next convention, we will be able to talk customers, market share, operational successes, problems and competitors’ criticisms instead of plans and expectations.
Wayne N. Schelle is chairman of American Personal Communications.
