Editor’s Note: RCR Wireless News goes all in for “Throwback Thursdays,” tapping into our archives to resuscitate the top headlines from the past. Fire up the time machine, put on the sepia-tinted shades, set the date for #TBT and enjoy the memories!
Tower industry booms
NEW YORK-The current public capital crunch has slowed dramatically the buildout of some domestic wireless networks, but it hasn’t changed the positive prospects for the wireless tower industry. “We think there have been about 1,600 towers (total) awarded (by carriers) under build-to-suit contracts in the last five quarters,” said Stephen Clark, chairman and chief executive officer of SpectraSite Communications Inc., Cary, N.C. “There has been a slowdown and stretching out of (network) deployment plans, and there will be fewer sites built out in 1999 than anyone thought just two months ago.” However, the regulatory push toward collocation of multiple tenants on individual towers and the expanding group of potential site users have created a favorable economic environment for tower companies, said Clark and other industry executives. They spoke at a recent conference, “Building Value in Communications and Media Towers,” co-sponsored by Kagan Seminars Inc., Carmel, Calif., and Lehman Brothers Inc., New York. This positive climate means commercial and merchant bankers likely would be well-disposed to rush in where investment bankers today might fear to tread in offering financing for the expansion of tower companies, Clark said. “The key to making towers pay for themselves is incremental revenues, which could be from many small users,” he said. “It’s not just a [personal communications services]and cellular world, although wireless is high-profile. There are a lot of other microwave systems, (like) pipelines and utilities.” … Read more
Actually, about those towers …
NEW YORK-Satellite Survey Systems Ltd., a Dallas company with roots in oil and gas exploration, has added another notch in its diversification belt by helping wireless companies pinpoint tower locations using global positioning systems. The company’s endeavors are part of a trend in the tower-siting business, which for many years had relied primarily on U.S. Geological Survey maps. USGS maps can be less accurate in some respects than versions of GPS systems available today, but that wasn’t necessarily the case earlier this decade. “As I’ve been given to understand, the technology behind GPS was developed by the Pentagon. Until very recently, the (GPS) devices available to the public, including private industry, were not completely accurate, out of concern they would fall into the wrong hands,” said Sheldon Moss, government relations manager of the Site Owners and Managers Association. SOMA is part of the Personal Communications Industry Association, Alexandria, Va. “Without the error factor, GPS is pretty darned accurate in determining latitude and longitude and, to some extent, altitude. In a significant number of cases, the industry (now) is using GPS in conjunction with standard U.S. Geological Survey maps.” Accuracy is a matter of degree, and degrees do matter, according to Lowell Phillips, a spokesman for Satellite Survey Systems and a principal of Investor Compliance and Integrity Audits Group, a Longview, Texas, consulting firm. ICIA Group plans to begin offering soon a tower location warranty program. “If your tower is 20 feet too low, somewhere along the way the signal goes into the dirt; if it’s 20 feet too high, the signal keeps heading up into the air,” he said. … Read more
Nokia is king of the device world
HELSINKI, Finland-Nokia Corp. declared itself the world’s largest manufacturer of mobile phones, as the company’s mobile phone net sales increased by 94 percent to $2.6 million during the third quarter. “Lower than anticipated price erosion in mobile phones and rapid digitalization in the Americas resulted in higher-than-expected sales and profitability,” said Jorma Ollila, president and chief executive officer of Nokia. “In September, we sold more than 1 million handsets in one week. Based on our strong performance and preliminary market data for the first nine months of 1998, we now feel confident in declaring that we have significantly increased our market share in mobile phones to become the largest manufacturer of mobile phones worldwide.” Nokia said it continued to strengthen its market position on all continents, with especially strong growth in the United States. Nokia said mobile-phone sales volumes are increasing due to the growing upgrade market, today representing more than 30 percent of the overall mobile phone market. During the first nine months of 1998, more than 80 percent of the Nokia mobile phones sold were digital. On the infrastructure side, net sales for the third quarter increased by 42 percent to $1.2 million, said Nokia. Sales were especially strong in China and Europe. … Read more
Philips, Lucent dissolve their JV
Royal Philips Electronics and Lucent Technologies Inc. last week said they will dissolve the consumer communications joint venture they established just more than one year ago. At the time of its formation Oct. 1, 1997, Philips Consumer Communications had high hopes it would be a top-three player in the markets for wireless handsets and pagers, corded/cordless phones and answering machines. Instead, the venture’s short history has been mired in delays and disappointments specifically related to its efforts in the wireless handset arena. In June, the company scaled back its ambitions for the wireless handset market after financial losses during the first quarter. The situation failed to improve during the second quarter, after which the company announced it would not break even this year as expected and that market delivery of certain wireless products would be delayed. During that time, high-level executives exited the company, including its chief executive officer, Michael McTighe. In September, Philips issued an earnings warning that indicated PCC would report higher losses and the parent companies would undertake a review of the joint venture. The culmination of that review is a divorce that will send 5,000 PCC employees back to Philips and 8,400 employees back to Lucent. Philips said, however, it expects to lay off many of the employees that will return to the company. … Read more
Carrier consolidation: Who’s left?
NEW YORK-After a flurry of announced mergers and acquisitions earlier this year, amid booming stock and high-yield bond markets, the deal flow has slowed in tandem with deteriorating conditions in the public capital markets. Even if the appetite of investors remained strong into this quarter, the other key question about the prospects for domestic cellular and personal communications services company mergers is, who’s left? Not many, in the view of Christopher Morris, senior vice president of Donaldson, Lufkin & Jenrette Securities Corp. “In wireless, I think consolidation is, for the most part done. The top five players control 80 percent of the subscribers and the top 10, 95 percent,” he said. Many of the smaller cellular firms can afford to sit tight because “they’ve been around since day one, have access to capital and feel comfortable operating next to the big guys, getting roaming revenues,” said Robert Lazzeri, senior vice president of Daniels & Associates. However, such smaller operators “could look for an exit” by being acquired if they decide they need to upgrade their old analog networks and find that banks aren’t willing to finance these capital improvements, he said. Price Communications Corp. is one smaller cellular player that could be in play, according to Glenn T. Powers of Cruttenden Roth Inc. in an Oct. 9 research report sent to RCR by Price Communications. … Read more
Motorola gets into telematics
SCHAUMBURG, Ill.-Motorola Inc. announced the formation of a new business organization, Telematics Information Systems, that plans to leverage the company’s technologies related to the telematics market. Fred Tucker, Motorola executive vice president and president of the Automotive, Component, Computer and Energy Sector, will chair the TIS board of directors. Robert Denaro was named TIS vice president and director. Telematics uses wireless voice and data to provide drivers and their passengers with location-specific security, information, convenience and entertainment services from a central service center. TIS will consolidate several Motorola units and development efforts, such as those developing telematics hardware and software, wireless connections within vehicles, global positioning system products, and also information and entertainment software and servers. Motorola said the decision to create this new group-level effort stems from the growth observed in the telematics sector. Motorola said the telematics industry is predicted to reach multi-billion-dollar sales over the next two decades. The Strategis Group earlier this month released a study predicting rapid growth in the automatic vehicle location and telematics markets. It estimates the number of vehicles with AVL and telematics will grow from fewer than 500,000 in 1998 to about 3.4 million by 2003. While consumer devices account for only 11 percent of the market today, this share will grow to 36 percent by 2003, the analyst firm reported. … Read more
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