Third generation cellular phone will surf the Net


A generation ages quickly in mobile telephony. The first generation cellular phones, now called analogue, were introduced in the 1980s, and their digital offspring, called GSM or DCS,brought international roaming in the 1990s. The third generation, appropriately enough, will surf the Net in the early 21st century.

Despite being only at the conception stage, that third generation, called Universal Mobile Telecommunications System (UMTS) in Europe, already looks set to lead a prosperous life: market analysts last month predicted the British government's auction of UMTS licences next year would attract bids of up to £500 million sterling. Stockbroker Henderson Crosthwaite said four licences would be awarded in a UMTS market predicted to be worth £3.6 billion by 2012.

But despite the term "universal", UMTS has been developed by the GSM world, and like GSM has not been widely accepted in the US, although it is one of a number of competing second-generation systems there. The others are called DAMPS and IS- 95. Mobile companies in the US now want the global third-generation mobile standard to be closer to their own second generation, probably meaning multiple global standards will be required.

Put another way, in the words of one European industry source, having watched European mobile companies rise to prominence on the back of GSM's success, US companies want compromise.

UMTS has mixed European and Asian parentage: the European Technical Standards Institute (ETSI), based in Sophia Antipolis, southern France's Silicon Vallee, and the Association of Radio Industries and Businesses in Japan. Ericsson is already running tests with Japan's NTT DoCoMo, the world's largest cellular operator.

UMTS is based on a radio interface which uses a standard called WCDMA, and can work with existing GSM systems, allowing a smooth transition to the next generation. But not in the IS-95 community, leading to calls to either change WCDMA or adopt multiple global standards.

"We do have some concerns that ETSI may have jumped the gun," says Mr Richard Engelman, the chief of the Planning and Negotiations Division at the FCC's International Bureau. The FCC, the US government's telecoms regulator, disagrees with the European desire for a single global standard, preferring to let the marketplace decide.

The marketplace in this case is not the consumer: the chief lobbyists are a collection of powerful mobile manufacturers, such as Motorola, Nortel and Qualcomm in North America, and Nokia, Ericsson and Alcatel in Europe. The US companies are concerned because the ETSI-preferred standard will not work with existing US digital networks based on the so-called IS-95 standard. Their preferred third generation standard is called CDMA2000.

The dispute has boiled down to a battle over patents, principally between Qualcomm and Ericsson. According to Mr Engelman, Qualcomm which is based in San Diego holds several patents for the commercial application of original (second-generation) CDMA, and is threatening not to share them in a patent pool unless the European WCDMA merges with CDMA2000. Swedish company Ericsson responds that WCDMA doesn't infringe any valid Qualcomm patents. Its corporate director responsible for standards, Mr Mats Nilsson, says Qualcomm is the only US manufacturer lobbying for convergence between the two standards.

A resolution to this issue may be at hand, thanks to ever smaller and cheaper technology. A recent Motorola and Nokia presentation to the International Telecommunications Union (ITU) proposed merging only enough of the radio interface parameters to allow dual-mode handsets to be cheaply manufactured. Welcoming such a development, Mr Alistair Urie, product strategy director for mobile operations with the French company Alcatel, says it may only cost as little as 10 per cent extra to make a multi-mode phone if enough of the radio interface is common.

If a solution to what Mr Urie calls "the radio war" can be worked out by the ITU's year-end deadline, the international body will be on track to recommend a standard or standards for global third generation by the end of March. Called IMT-2000, the next generation of mobile will then offer truly global roaming, one of its cherished goals.

Other goals include richer services, based mainly on faster data interfaces. Unlike GSM's current maximum data rate of 9,600 bits per second, UMTS will offer up to 2 megabits per second to users in small indoor cells, typically office-wide cells. Mr Fergal Kelly, the director of products at Eircell, says this will allow high-quality video or very fast and graphics-rich Internet access on mobile phones. He expects many applications based on machineto-machine data communication, such as cars talking to navigation systems.

Ireland currently has one first-generation system (Eircell's 088 service), and two second-generation GSM systems (Eircell's and Esat Digifone's GSM systems). The forthcoming launch of Meteor's DCS 1800 system, a sister technology of GSM, will bring another second-generation system into Ireland, and third-generation licensing is likely to become a priority for the Telecommunications Regulator sometime next year. We can expect the first working systems sometime after 2002.

But in the meantime, says Mr Kelly, GSM will increase its data rates: "Before UMTS, we will move the existing system towards UMTS." A first technology, called high-speed circuit-switched data, will allow up to 38 kilobits per second (kbps) data channels to mobiles, depending on local network conditions. This is expected sometime in late 1999. Then sometime around mid-2000, he says, a second technology called GPRS (generic packet radio ser- vice) will further increase the data speed to 115 kbps.

While the interfaces speed up, the phones too are becoming more advanced. Smaller, cheaper and faster chips mean more memory coupled with bigger screens. Mr Kelly says these will initially feed the top end of the market, but mobile Internet browsers and video phones are "very much on the cards in the next 18 months", he adds.

Eoin Licken is at