Building in-roads: Gaining coverage indoors could help retain customers

Although the demand for in-building coverage is higher outside the U.S., the scene may change considering the rising wireless user population. More people today rely on wireless phones to conduct business from wherever they choose, whether it's a local mall, sports arena or grocery store. All of this can happen - if carriers have coverage in those places. With this kind of accessibility becoming the norm, in-building coverage soon will become another value-added service.

A recent report from the Phillips Group-Info Tech states that the U.S. in-building wireless voice market will grow at an average annual rate of 34% to reach $815 million in revenue by 2003, up from $191 million in 1998. The growth is attributed to the surge in subscribers, whose need for mobility products that can be used in and out of the office has grown.

"In the next 12 months, there will be a major thrust into buildings," said Dave Bolan, vice president of marketing for Repeater Technologies. Because PCS phones operating on the 1900 MHz frequency have a harder time penetrating buildings than those operating on other cellular frequencies, Bolan foresees a definite drive toward taking coverage inside. "If PCS providers want business users, they need to get into buildings," he said, citing airports and convention centers as necessary points of coverage.

But recently, the U.S. mostly has been automobile-oriented, with a focus on providing just enough coverage, said Mark Whitton, director of product management for CDMA access at Nortel Networks. "We are just starting to see the first push toward in-building."

The large business campuses also are good markets for in-building work, Whitton said. Nortel plans to work with Sprint to ensure in-building coverage for its campus in Overland Park, Kan.

Carriers will have to find different ways to secure financing for in-building coverage, Whitton said. Carriers may even strike deals with organizations that could benefit from having the coverage in their establishments and negotiate with them to subsidize the investment, he said. Because of the high costs associated with enhancing coverage, carriers must consider whether a building will generate enough traffic before deciding to cover it. When U S West Wireless took its in-building repeater application into The Mall of America in Minneapolis, it considered the nearly 1 million shoppers the mall hosts each month during peak seasons, which translated into a good investment.

Smaller carriers, too, are considering adding indoor coverage. "It is a natural thing, once the basic footprint is laid out, to focus on in-building coverage," said Clayton Bodnarek, general manager of Amica Wireless, which serves customers in central Illinois.

However, lower-priced solutions for small carriers are not available, Bodnarek said. "A lot of businesses are willing to pay for in-building coverage, but there are not a lot of solutions in the market."

A number of products currently awaiting FCC approval will help small carriers, he said. He hopes this will happen by the end of the first quarter.

Customers have voiced plenty of complaints about how their cellular phone used to work in certain buildings and their PCS does not, Bodnarek said. "We want to do something for them. It would be golden to us if we could provide strong in-building coverage for our customers," he said.