The Internet edge

Can you lose money and succeed at the same time? PCS carriers have been among the first to test the theory, only recently postulated. Immediately following the first round of license auctions back in 1995, the weary winners bucked up and said it was only the beginning of their long, arduous journey. They knew they would lose money for at least a few years before seeing a payoff.

What mattered, they claimed, was their new energy for marketing wireless service, new pricing and new products. These things would carry them through, and to some degree that has happened. Many PCS carriers are still losing money-a few have even suffocated from debt-but several are becoming well-known brands.

This story is similar to the experiences of the Internet's electronic commerce pioneers. A few years ago, start-ups such as Amazon.com and Yahoo knew they wouldn't make a profit for several years. Most of them are still eating their losses, but that hasn't stopped them from leveraging creative and energetic marketing to become well-known brands.

The downside for the e-commerce gang has been getting users to buy on-line, but as of the recent holiday season, that bridge has mostly been crossed. The upside is that they have faced no entrenched monopolies and have been able to lay the groundwork for other e-commerce ventures to follow.

That foundation is where PCS carriers need to look next. The wireless industry has put great energy into selling wireless not just as technology that enables mobility of communication, but as the enabler of a complete mobile lifestyle. With wireless Internet access as a hopeful but not pervasive service, the only time users may need to touch a cord is when they need to surf the Net.

Likewise, the Internet itself has been proffered as the enabler of a virtual lifestyle-you don't need to physically locate yourself in a different space every time you want buy something or gather information. Internet users are beginning to expect that anything they need will be available at the click of a mouse-including wireless services and features.

Some wireless companies are beginning to get the idea by allowing customers to buy products and services on the Web to varying degrees. However, e-commerce is still mostly virgin territory for carriers. This issue's cover story takes a close look at the hurdles and benefits to shopping for wireless on the Web. In any case, PCS players should take the hint.

Why not? The costs to start up a Web-based business are minimal, and the technical complications of billing and service activation aren't all that complicated.

PCS carriers have to take to a step onto the Web if they are going to move further away from those early losses and into a comfortable profit zone. If you are losing money, you haven't succeeded yet.