The quickening pace of competition and regulatory liberalization in global telecommunications markets is increasing demand for wireless local loop technology, with annual equipment expenditures expected to reach $7.6 billion by the year 2000, according to a new report from Northern Business Information.
In “Global Wireless Local Loop Markets: 1995,” NBI reports last year’s expenditures for WLL equipment amounted to nearly $200 million. “The primary driver for WLL service development in developing countries is simply the demand for telephone service,” according to Melanie Posey, senior analyst for wireless communications markets at NBI. “WLL offers the possibility of getting phone service in weeks or months rather than years.”
Although WLL systems require site acquisition for base stations, they “do not involve major civil works-digging up streets to lay cable-and can be built out according to demand, while wireline networks require large up-front investment and capacity must be built out in advance of demand,” Posey said.
In countries with fully developed telecommunications infrastructures-such as Germany and the United Kingdom-WLL gives new carriers a chance to grab market share from entrenched incumbents.
“In industrialized markets WLL technologies are a more timely and cost-effective means to an end rather than the end itself. New operators don’t have the time-or in many cases the resources-to build nationwide wireline networks from scratch,” Posey said.
Northern Business Information forecasts the Asia-Pacific region will account for 40 percent of added WLL lines by 2000, with Latin America and Eastern Europe having 25 percent and 20 percent, respectively.
NBI sorts wireless local loop equipment into three broad categories: fixed cellular, proprietary systems and low-power technology-based networks.
Fixed, cellular-based systems-both analog and digital-provide direct connection to the public switched telephone network. “Analog cellular systems primarily address the market for plain old telephone services in underdeveloped telecommunications markets or in underserved areas of rapidly developing markets,” Posey said.
Digital systems are being positioned as add-ons to Global System for Mobile communications networks, while WLL networks based on Code Division Multiple Access technology “are being aggressively marketed in countries such as India and Brazil as systems that provide better voice quality than their analog counterparts, additional service features, and most importantly, increased capacity,” she said.
Proprietary systems-mostly based on broadband CDMA technology-are designed specifically for local loop applications as alternative PSTN access systems and, as such, provide wireline voice quality service and features.
Posey emphasizes, “These systems … are not stripped-down cellular systems.”
Cordless/low-power technologies are designed for use in congested urban areas and optimized for high-capacity, wireline-quality, short-range communications.
NBI said several standards are vying for dominance in this category.
The Digital European Cordless Telecommunications standard is being pushed by Ericsson Inc. and Siemens AG.
The Personal Access Communications System is backed by Motorola Inc. and the alliance of Hughes Network Systems Inc., Siemens Stromberg-Carlson and Bell Communications Research Inc.
The Japanese Personal Handyphone System standard is promoted by Nippon Telegraph and Telephone Corp. and NEC Corp.
