Offering customers wireless access inside and outside the office will enable wireless carriers to gain new subscribers, retain current subscribers and generate increased airtime revenue, said Jerry Kaufman, president of Arizona-based Alexander Resources.
Kaufman believes cellular and personal communications services providers that supply “dual domain wireless telephone systems” will do well in the increasingly competitive U.S. marketplace.
Dual domain systems offer users mobility at work via wireless access to the office’s private branch exchange, Key or Centrex switch, and outside the workplace on a wide-area cellular network, all from one handset. In the office, most systems operate in the 1.9 GHz unlicensed PCS band.
If in a particular business only a handful of employees carry cellular-and soon PCS-phones, they each may subscribe to different service providers. However, if one carrier sells that company a dual domain system, current cellular users desiring the dual environment capability must access cellular service through the same provider. Also, once that business installs its dual domain system, employees previously without cellular service may be more inclined to subscribe, since their office already is mobile.
Targeted at business people, who rack up the most airtime minutes of all consumers, dual domain systems present an opportunity for carriers to increase revenues, Kaufman noted. Overall, these systems provide carriers the ability to secure masses of high-usage customers in one effort.
Is it a hard sell? Kaufman believes it is not, on the measures of actual costs and comparative value to wireline services. The wireless portion of communications in an office or on a campus is from a base station to the company’s switch, which usually means no airtime charge. Competition among service providers is expected to continue driving down prices for wide-area wireless services. Kaufman predicts PCS players entering the market will try to win over cellular business customers by selling dual domain wireless systems and positioning their services as lower in cost and better in quality than cellular.
AT&T Corp.’s Definity Cellular Business System is one example of an opportunity for carriers to secure customers, Kaufman said. AT&T makes circuit boards, which plug into existing AT&T PBX switches to enable wireless communications indoors. These integrated systems cost 25 percent to 35 percent less than an adjunct system. Thus, cellular and PCS carriers could realize greater sales potential among those businesses with the integration capability. Kaufman expects other manufacturers will design similar circuit boards that are proprietary to their own switches.
Further, Kaufman’s research suggests once the per-unit price of dual domain wireless systems drops to within $200 above that of existing wired PBX systems, many businesses will purchase the systems. Even in offices where employees sit at their desks all day, companies could be willing to pay a little extra just for the reduced maintenance hassle of having wired lines, Kaufman stated.
Peter Bernstein, president of Infonautics Consulting Inc. in Ramsey, N.J., agrees that in-office wireless systems will become increasingly attractive to businesses and will provide carriers with an opportunity to increase their cellular penetration.
Wireless access in the office means less operating expense than a wired phone system. Plus, Bernstein pointed out that office workers spend on average of two hours a day away from their desks but in the office. Those equipped with wireless phones will miss fewer calls, and in turn need to place fewer return calls, saving the company money. Costs for external voice communications can drop between 10 percent and 40 percent, depending on the business, said Bernstein.
