MYRTLE BEACH, S.C.-Executives of Motorola Inc. and the Personal Communications Industry Association sparred over the future of paging and device-makers’ support for it at last week’s Southeastern Communications Association “Wireless Messaging 2001” conference held here.
“Although we have seen some decline this year, early on information indicates this is very recession related and not necessarily market related. We are all hanging onto that hope,” said Larry Snowden, director of indirect distribution for Motorola’s Wireless Messaging Division.
Among American preteens and teenagers, 14 percent already own and use one-way pagers. Based on very recent surveys, another 26 percent, or 11.6 million, are likely to get a pager within six months, even though many already use PCS wireless phones, Snowden said.
Within all age groups, 32 million, or 12 percent of the population intend to acquire one-way pagers, according to surveys conducted late last year, he added. Furthermore, among people who have never owned a pager, 9 percent, or 23.5 million, plan to get one within six months.
“As for one-way and numeric messaging, this will hopefully give you some better news … Let’s not give up on it yet.”
Snowden was not in attendance at the presentation following his, a fact noted by the speaker, Eddie Gleason, director of governmental relations for the PCIA and manager of its Paging Technical Committee
“I don’t think you knew when you put this program together that it would be so timely … I respectfully disagree with the Motorola guy about industry trends, given Motorola’s announcement a month or two ago to abandon the industry and Glenayre now doing the same thing. …With these recent manufacturer announcements, if they’re not going to support two-way, why would they support one-way?” Gleason said.
“Motorola is getting away from paging and out of ReFLEX and moving into cellular. … With pressure from Nokia and the rest, Motorola is going back to its cellular backbone, but I’m somewhat surprised about Glenayre because they don’t have much of a (cellular) backbone.
Gleason said Jay Kitchen, president of the PCIA, is in negotiations with Motorola to take over “licensing of 2.7 ReFLEX and beyond.”
Motorola soon plans to introduce its Bravo 500, a one-way, side display, 900 MHz pager synthesized in FLEX, Snowden said. If this proves popular, the equipment maker plans to make UHF and POCSAG versions available commercially.
“Rumors we will walk away from one-way paging are not true. We still make money at it. … We will continue to make the products we have in UHF and POCSAG, but the sheer reality of it is that UHF is less than 5 percent of the overall market,” Snowden said.
“Now that large carriers are not purchasing, there is the potential for smaller carriers to come back into their own. People who own UHF networks will be sitting in the catbird seat.”
Although insisting that Motorola is not abandoning traditional paging, Snowden also said the company’s “emphasis is on the new cellular transport.” Its new V100 personal communicator is “similar to low-end, two-way messaging in ReFLEX, but it operates over VoiceStream’s network, which uses an SMS overlay to GSM,” he said. The first generation of the V100 makes use of a headset for phone calls, while upcoming models will have a clamshell design to resemble a wireless handset more closely.
In July, Motorola expects to debut its new A009 for messaging in GPRS environments, and it also plans to sell a similar unit that operates on CDMA networks, Snowden said.
“Stay close to this new two-way messaging over cellular networks, get up to speed as to what the technology is and become resellers, the same way many of us latched onto Nextel,” he said.
E-mail forwarding to alphanumeric pagers is “one of the best opportunities for the paging industry “because consumers will find they pay a lot more to retrieve e-mails from the cellular and PCS side,” said John Steinberger, president of the SCA. Several companies are offering software solutions to provide this capability.
Pagers also provide more data storage capacity than cellular and PCS phones, Gleason said.
PCIA is at work on a development that will be an important catalyst for paging, he added. The association “is close to finalizing the Universal Addressing Database, which will allow communications between different (carriers’) pagers,” he said.
Snowden said he could not comment on Motorola’s unit sales of one-way and two-way pagers so far this year. The rate is growing, but not in line with earlier “optimistic and very aggressive plans for growth,” he said.
An audience participant who works for Metrocall said inadequate supplies of two-way pagers have hindered the carrier’s efforts to transition its customer base to more advanced messaging services.
The SCA Wireless Messaging conference is geared primarily to people and companies involved in the one-way paging sector, Steinberger said. Because of the large numbers of reconditioned pagers in the market, device sales no longer are a reliable indicator of subscriber trends, he said.
One-way paging has taken the biggest hit in areas where Leap Wireless International has entered with its Cricket PCS service, but Leap also has very high subscriber churn rates, SCA’s Steinberger said.
One conference attendee who said he is a reseller with 12 stores in the South has been successful in selling pagers in tandem with Cricket service because the pagers have a much larger coverage area. The audience participant also said his success has resulted from the fact that he pays the same commissions to his staff for signing up paging and cellular/PCS customers.
Another audience member who works for a smaller paging carrier from upstate New York said his company has been doing a brisk business lately acquiring subscribers churning off of larger carriers with bad coverage and customer service.
Steinberger said his sense of the paging industry generally is that this experience of the New York state carrier is being replicated nationwide. However, he cautioned that the phenomenon of large carriers, like TSR Wireless, closing up shop and abandoning their customers might push paging subscribers to competing wireless technologies.
“I (also) wonder if Glenayre pulled out of the business because they are worried about extending (credit) terms to people. … It is finally catching up to where someone has to pay the piper, and there is a lot of outstanding debt that won’t be paid,” he said.
“The common conception is we’re in the state we’re in because of declining rates due to competition by large carriers. … Everyone said once we see enough consolidation in the industry, the rates would start to come up. The question is have we reached bottom yet?”
Although Gleason noted that PCIA is repositioning itself away from an emphasis on paging to a focus on mobile commerce, he also said he believes one-way paging will retain its role “as a reliable and viable niche market.”
In its efforts to tap into the two-way messaging opportunity, the industry must correct its major mistake of marketing itself as a direct competitor of cellular and PCS communications, in his view.
“If marketed as a wireless data transport device, paging will be successful, but near real time two-way paging cannot compete with real time cellular,” he said.
