Eyes on the Prize

In an industry fraught with service-related cliches, Western Wireless has earned the indisputable right to use one: speed to market.

The holder of broadband personal communication services licenses for seven major trading areas has bolted from the pack of competitors in this nascent industry segment by deploying full-blown networks and turning up commercial service in four of its markets already. These include Honolulu; Salt Lake City; Albuquerque, N.M.; and most recently Portland, Ore., in September. Yet two more are promised this year and the final one will be up in early 1997.

How Western Wireless, based in Bellevue, Wash., has managed to accomplish that feat can be, according to its principals, attributed to a combination of well-developed processes, human experience and technological development. But the carrier also points to one more important factor: focus.

The concept of focus in and of itself is admittedly difficult to relate with a precise meaning or tangible results. But when considered in the context of what Western Wireless has accomplished in such a short period of time-how it has burgeoned from cellular roots to become one of the early leaders of the PCS movement-focus becomes a decidedly applicable term for defining the company and explaining its success.

Tapping technology There is little doubt that electing to deploy an established digital technology in its PCS markets was a boon in speeding Western Wireless' VoiceStream-branded networks to a commercially viable state. All the PCS operators that have operational networks thus far have deployed PCS 1900, the U.S. turn on European GSM technology, and like Western Wireless, all of them have achieved early success.

"The technology really is plug and play," says Robert Stapleton, president of Western Wireless. In addition to the established implementation processes that accompany GSM, its global prevalence produces no end of educated human resources, he says. "There's a worldwide talent pool you can tap into.

The company was able to optimize its operational networks just 30 to 60 days after the equipment had been installed, something Stapleton believes will not be possible with other technologies-code division multiple access among them-that are not nearly as familiar.

Other PCS 1900 benefits include natural capability for short message services and other enhanced features.

Western Wireless also had early advantages in the area of microwave relocation of incumbents in the 2 GHz band, Stapleton says. By tackling that issue early on and with a very focused mission in mind, Western Wireless managed to clear a hurdle that has tripped up so many other operators that have been held hostage by incumbents demanding outrageous replacement systems.

"We took a different approach: We did all our microwave clearing in-house, and it was a lot less technically driven," he says. "We got in and made deals with people before their expectations changed. They hadn't been lobbied by others to hold out for premiums, so we got a large number of very equitable deals.

The small size of the Northern Telecom PCS 1900 infrastructure equipment Western Wireless has deployed also made it easier to gain zoning approval and locate gear in ideal sites. In some of its markets, Stapleton says, 75% of the cell site antennas are located on rooftops. In others, 30% to 40% are rooftop sites, and in all regions co-location with cellular operators and local utilities-and the cooperation of local businesses-contributed to easy of installation, he says.

Heightened community sensitivity to radio frequency emission and increasingly drawn-out zoning procedures have been a source of much consternation in the wireless industry, although the Telecom Reform Act of 1996 addressed these issues to some degree.

"The single most critical path is getting zoning and use permits to build out your systems," Stapleton says.

"Western has been very effective in dealing with the zoning issues," says Shawn Doyle, vice president of wireless sales at Nortel, which provides all the infrastructure for the carrier's PCS networks and has also been a key supplier in its cellular markets.

But acumen at dealing with siting and zoning issues is not all it takes, Doyle says.

"Western Wireless has a very sharp management team and is an experienced operator," he says. "They have a great deal of depth and a focused deployment plan.

Voices of experience At the basis of the Western Wireless PCS strategy is a wealth of expertise in the cellular environment. The company's leader, John Stanton, was one of the founders of McCaw Cellular and served as chief operating officer there for several years. He then became chairman and chief executive officer of General Cellular Corp., which in 1994 merged with Pacific Northwest Cellular parent company Markets Cellular to form Western Wireless.

Many key people within Western Wireless also have backgrounds with McCaw, GCC and Markets Cellular. Vice Chairman Donald Guthrie is a former McCaw senior vice president; Stapleton was president of GCC and is a former Pacific Telesis Mobile (now AirTouch Cellular) employee; COO Mikal Thomsen held that post at Markets Cellular as well as various positions at McCaw; and Chief Financial Officer Theresa Gillespie was also CFO at Markets Cellular.

To build a PCS presence, the company simply expanded upon that base and began forging into its new regions. "We parachuted people into all of our markets," says Stanton.

The fact that Western Wireless is an 800 MHz cellular operator in 74 A band markets is beneficial in many ways. In addition to the education that 12 years of wireless operations experience provides, the company's cellular background is also producing tangible systems for use in its PCS business. To this end, Western Wireless has tapped into its existing customer care and billing systems and will use those resources jointly between its cellular and PCS markets.

"From the start, we centralized all these back office systems in a national call center in Seattle," Stapleton says.

But human and technological resources aside, when it comes to developing a new business and building new networks to provide new services to new customers, nothing helps more than years of practice.

"The benefit of our cellular experience is that we have a real-world appraisal of what we expect the systems to do," Stapleton says. "We've been in the business for a number of years and we're very conversant of how to build out the system.

Mining the market Another key consideration for Western Wireless before it could ever launch service was branding. Although the carrier is well established in the cellular world, it operates in all its markets under the Cellular One banner, so a new identity for the PCS markets was crucial.

"We're positioning ourselves as a new competitor offering a product that is better than cellular," says Stapleton. "We didn't feel like we could straddle that dual identity and we didn't feel like that was important to customers.

The choice for the PCS brand was VoiceStream, a name Stapleton believes is appealing to customers and carries the appropriate significance without being too inflexible or defining service options too rigidly. To date, both the brand name and the service itself have proved effective.

"The penetration levels have exceeded our expectations, and customers are using the phones quite a bit," says CEO Stanton.

The reciprocal of the branding situation is also true: The Cellular One markets are not likely to carry the VoiceStream name, Stanton says, while also downplaying the necessity to distinguish between the two types of services.

"We have no immediate plans to make changes in the cellular business-the Cellular One name is a widely deployed name and is a great name for our markets," he says. "Labels like cellular and PCS are less meaningful. We talk about usefulness to the customer.

And, just as the cellular brand of Western Wireless was not transferable to its PCS markets, neither is the PCS strategy of deploying all digital service appropriate for the cellular side, according to Stanton.

"The prime reason driving people to go digital on the cellular side has been capacity, and we don't need it for capacity," he says.

Indeed, says Tim Wong, vice president of engineering and operations, the mostly rural markets that comprise the company's cellular territories call for a different technological deployment strategy, driven by more sparsely populated regions and cost considerations.

"We are opting to go high power-to get on the highest carrier site in the area and cover a very broad area with a low-capacity environment," says Wong.

That isn't necessarily the case for all companies competing or planning to compete in both cellular and PCS arenas, but for Western Wireless it defines a challenge: With PCS, the company is now entering markets that are different in both engineering and customer considerations, factors that are likely to enhance the carrier's skills in both of those areas.

"With cellular, we've had time to pay as you grow in terms of new infrastructure and capacity enhancements," says Wong. "With PCS, we had to get to market-time to market has been our most critical factor.

And if the success of Western Wireless to date is any indication, the company has achieved that time to market goal.