Fashionably late: SBC launches wireless Internet strategy in California

While details of SBC Communications' wireless alliance with BellSouth are being ironed out, SBC Wireless is moving forward with its wireless Internet strategy by launching service in Pacific Bell Wireless' California territory. The company may lag behind other competitors in its market, but perhaps the wait will allow it to gauge exactly what consumers want from the wireless Internet.

With last week's announcement, Pacific Bell Wireless consumers in the state can benefit from an Internet agreement that SBC Wireless forged with InfoSpace last month. Though California marks SBC Wireless' first foray into the wireless Internet space, the carrier intends to roll out additional service throughout all its wireless affiliates later this year.

SBC is somewhat late to the party; most other nationwide carriers already have launched their wireless data offerings. The carrier maintains it wanted to refine its strategy rather than throw any offering out there.

"We have been trying to get consumers ready and aware of what the wireless Internet phone can do," said a spokesman for SBC Wireless. "There have been cases where consumers have been over-promised." To avoid this, the carrier has been contemplating its product for the past 18 months. The company began by launching a short message service.

Technology differences among SBC's units also could pose problems for a smooth national rollout. SBC is comprised of carriers that use both GSM and TDMA, which has presented rollout challenges in a nationwide wireless Internet offering.

The company maintains, though, that understanding consumer demand is more important than any technology hangups."

Now that SBC has gone to market, it faces competition from the likes of Verizon Wireless, Sprint PCS and AT&T Wireless, which have targeted the early adopter-heavy West Coast with their wireless Internet offerings (see box).

"Pacific Bell Wireless will have no trouble competing because they have a strong regional footprint, which is key to launching service," said Jeff Coons, an analyst with The Strategis Group.

On the other hand, the delay could stem from the possibility that parent company SBC has not pushed the wireless Internet strategy as hard as other telecom companies, said Barney Dewey, a consultant with the Andrew Seybold Group.

"They can only offer it in certain markets," he said, noting the nature of the various technologies used in its markets. There also had been speculation that one year ago Pacific Bell Wireless lost key personnel in its wireless Internet initiative, Dewey said.

Ironically, in an atmosphere so focused on getting to market first, waiting to launch its service could prove to be advantageous for SBC. "Consumers have been disappointed with the first movers," Coons said. "What Sprint did was just throw everything out there to see what sticks instead of finding out what the consumer actually wants."

While there are plenty of early adopters in the areas Pacific Bell Wireless serves and many who have signed up for service with another provider, SBC is confident the carrier's offering will appeal to a wide variety of consumer groups. "Early adopters are tech-savvy and they need a product that will meet their expectations," the spokesman said.

Via the InfoSpace wireless infrastructure, Pacific Bell Wireless' consumers will be able to send messages and access their e-mail accounts from an Internet-enabled phone or send e-mail from PC to any e-mail-capable device. The carrier plans to offer e-commerce capabilities later this year.

Valor Telecommunications Southwest completed transactions to acquire 420,000 local access lines in New Mexico and Texas, and assumed operational control of the lines. The lines were previously owned and operated by Verizon.

Nextel Communications started to roll out Nextel Online wireless Internet services in the Michigan and Toledo, Ohio markets. With Nextel Online, Nextel offers a wireless phone that serves as a four-in-one wireless business communication tool. Nextel's Internet-capable "plus" phones integrate wireless Internet service, digital two-way radio service, digital cellular service and text/numeric paging into one phone.

V.Cities has activated its Phase 1 rollout, which consists of 21 cities, 17 of which have been deployed and now are operational. Full implementation of the network is anticipated by mid-2001.