SAN FRANCISCO-Even as the tech-heavy Nasdaq stock market was spinning out of control and dragging down telecom shares last week, wireless network and marketing managers here were brimming with optimism about a industry whose biggest challenge is keeping up with fast-paced growth and all the problems that come with success.
With 90 million mobile phone subscribers in the U.S. and a double-digit percent growth, wireless carriers are facing a myriad of internal and external pressures to remain competitive.
In some cases, carriers are their own biggest competitors.
With subscriber growth continuing unabated and the trend toward Internet data applications, wireless carriers find themselves having to fine-tune networks in real time to increase capacity, as well as engineer solutions for the transition from voice-based systems to data-driven third-generation wireless networks.
In some cases, that could mean adding micro or pico cells to improve outdoor and in-building coverage. But, with cost being an issue for highly leveraged carriers, Stanley Chia, director of mobile phone systems for Vodafone AirTouch Global Technology, advised, “Unless you’ve exhausted all other possibilities don’t even think about microcells.”
Network improvement also could mean extending build-out to rural areas, which tend to see the benefits of new technology long after urban markets have gone digital. Carriers are feeling tacit pressure from the Clinton administration and Congress to close a “digital divide” that may leave rural, low-income and minority citizens behind in the Information Age.
All the while, carriers are trying to find ways to limit churn-a huge problem resulting from poor service quality, lousy customer service and price wars. For carriers that spend $400 or more to acquire each subscriber, the financial fallout of churn is enormous.
Site acquisition is as big a problem today as it has ever been, with hostility coming from local governments and residents who believe towers are ugly, environmentally and biologically harmful, and a drag on property value.
But as tough as technological, marketing and managerial issues are for carriers in terms of increasing network capacity, reducing churn, re-engineering systems for 3G and blowing up business plans to capitalize on the emerging wireless Internet market, one major carrier who spoke in this high-tech mecca said the real key to future success depends on something very low tech: old-fashioned human relations skills.
“The biggest area of challenge is community relations,” said Virgil Stites, director of marketing and business development for Sprint Sites USA, at a conference sponsored by the Institute for International Research.
Stites said industry must do a better job of cooperating with local citizens and government leaders in light of projections that the number of antenna sites required could swell to 200,000 over the next five years.
“It’s essential that commercial and community interests are aligned,” said Stites.
Stites urged the industry to be more proactive in addressing health and safety issues. “We can’t just talk about public safety after the fact,” he said.
Stites, noting mixed findings of mobile phone cancer studies, said the industry needs to do more than simply tell citizens that research is inconclusive. Instead, he recommended that industry engage in serious dialogue that, for example, might compare alleged health risks from phones to other societal risks.
“We need to as an industry provide leadership in this area,” said Stites.
Stites said that though human health, aesthetics, property values and even the impact of towers on migratory birds may seem tangential to the wireless business, they must be addressed. “We are going to inherit all those issues…We have to think beyond today.”
Stites’ remarks were in marked contrast with the approach employed by powerful wireless lobbyists, who tend to react aggressively to health, driver safety and antenna siting controversies as they arise.
That strategy has backfired in recent years, putting the industry on the defensive and ill-equipped at times to address thorny issues-like health, driver safety, antenna siting, billing and service quality-at a time when wireless products and services are being consumed by the masses outside the Beltway.
The philosophical approach to problem solving espoused by Stites, being so different from the zero-sum game of aggressive wireless lobbyists, raises questions about the extent to which carriers’ interests are being accurately represented in the nation’s capital.
“None of us want to see these things legislated,” said Stites.
