Year in Review

'Twas the end of the year, and through every state Carriers pondered what made this year great. Their boards of directors had acted with care In hopes that investors next year would be there.

Each wireless carrier had its own purpose With visions of handsets, features and service. New rate plans emerged in a number of cases And prepaid rolled out in several places.

Footprints expanded across the whole nation, Through launches and mergers and affiliation. And those that had service in every state Were able to offer a low national rate.

Mergers pervaded the whole industry With announcements from Ameritech and SBC, Not to mention Bell Atlantic and GTE, And the already-completed ALLTEL/360 degrees.

The trade groups were busy -- acting with care To make sure regulations were easy to bear. With two lively men, each an industry healer, PCIA's Jay Kitchen and CTIA's Tom Wheeler.

"Now, taxes! CALEA! Now, E-911! On Extensions! Compliance dates! Isn't this fun? Just when you think you've enough on your plate The government gives you another mandate!"

As C-block reprieves saved some carriers dollars, The new payment obstacles made other ones holler, "This special treatment of some is unfair. See you in court, FCC ... So there!"

And then, in a twinkling, our Fed'ral Commission Was licensing spectrum for data transmission. However, when all of the bidding was through The revenue totals made the FCC blue.

The LMDS auction results were quite strange, Not a bonanza -- more like loose change! While FCC hoped to rake in four billion, The total was only 500 million.

Technology organizations worked on 3G. (As usual no one could seem to agree.) By the end of the year they saw some resolution. A family of standards was the solution!

On certain things, they took a united stand. "For wireless data, we must create demand. We also must find our way into IT Or we may be run over by the computer industry."

Rumors that Sprint was seeking a mate, Made CEO Esrey set it all straight: Sprint PCS will sell millions in stocks To detach from TCI, Comcast and Cox.

Skeptics questioned if AT&T's Project Angel would come to be. The company said there was nothing to fear, If costs could be cut by the end of the year.

So as '98 now draws to a close It's time to look back on the roads that we chose. We learn from the past in all that we do, So sit back and ponder the year in review.

The new year signified a fresh start for everyone, especially when it came to rules and regulations for wireless carriers. The first quarter marked the FCC's C-block restructuring. In February, the FCC extended the date for C-block licensees to select payment options. After it received 37 petitions seeking reconsideration, it issued a Reconsideration Order, which allowed licensees to make their payment choices on an MTA basis rather than one all-inclusive decision.

The order also permitted them to disaggregate licenses and repay the remaining outstanding balance due on the disaggregated license. The FCC extended the 60-day non-delinquency period to 90 days and imposed a 5% late payment fee for payments made in that period.

NextWave opted to file for bankruptcy instead of selecting an option. Omnipoint, however, avoided billions in debt to the FCC through the plan. The ruling did not sit well with some carriers, who filed suit against the FCC, alleging it extended special considerations to C-block auction winners that were unfair to competitors and losing bidders. There-auction is set for March 23, 1999.

Nineteen ninety-eight also looked bright for hopeful LMDS providers. The LMDS auctions, originally scheduled for Dec. 10, 1997, generated $578,663,029 after 28 rounds Feb. 18. The number was a shock to analysts, who had predicted more than $4 billion in revenues. The FCC auctioned 986 LMDS licenses, two in each of 493 BTAs. Of them, it sold 864. WNP Communications came out on top with 37%. As of press time, some LMDS providers predicted first-quarter 1999 launches.

The 1994 Communication Assistance for Law Enforcement Act (CALEA) was a controversial topic this year, too. In February, CTIA asked the FCC to help implement the act, alleging the FBI is two years overdue in publishing capacity requirements. CTIA said the FBI had expanded its surveillance authority beyond the scope of the law, with the industry paying for additional requirements. CTIA and PCIA filed suit against U.S. Attorney General Janet Reno and FBI Director Louis Freeh, asking for reimbursement if carriers upgrade equipment to meet the specifications. TIA joined the two to file an amendment that requested relief from wiretap requirements and FBI audits of carriers' records. In September, the FCC adopted a Memorandum Opinion & Order extending the compliance date for meeting the CALEA requirements from Oct. 25, 1998 to June 30, 2000. The groups hope the grandfather date, which makes carriers eligible for federal funding to pay for equipment modifications, will be extended to the same day.

The World of 3G Early in the year, each of the three technology standards groups promoted its 3G system that will allow global roaming, including high-speed data multi-media services. The CDG's executive board passed a resolution that said the group is eager for the consolidation of CDMA technologies -- cdmaOne, the CDG's version, and W-CDMA, the GSM Alliance's version. Perry LaForge, CDG executive director, said the CDG had spoken with GSM and CDMA operators around the world, and many are in favor of convergence because they are concerned that a fragmented market would prevent significant economies of scale and prevent the emergence of 3G systems.

However, both the UWCC and the North American GSM Alliance expressed support for multiple standards in the United States and abroad. GSM North America opposed the cdmaOne proponents' proposal to combine the two technologies. The Alliance said these changes would cause a significant degradation in system capacity, affect additional capacities and performance, and probably raise the price to customers. The two organizations were pleased when the ITU said it would assess a family of global 3G standards to meet future specifications on high-speed data, video, Internet and sophisticated multimedia services. Later, UWCC and the North American GSM Alliance announced they will work together to ensure all new wireless technologies will be made available to U.S. consumers. The organizations' cooperation is not a combination of standards; however, the two groups took the first step in global convergence with an agreement on a common next generation of technical standards for high-speed modulation (8PSK), next generation air interface to support high-speed data (200kHz EDGE) and high-speed packet data architecture (EGPRS). UWCC Chairman Gregory G. Williams said the agreement is to ensure that the interests of wireless operators, manufacturers, employees and customers are fairly represented throughout the world. The two groups agreed to investigate areas of potential convergence in the evolution of the technologies supported by the UWCC and the GSM Alliance.

Price Wars To offer nationwide pricing plans, carriers sought to build national networks, some through affiliations. In February, AT&T formed a joint venture with Cincinnati Bell to provide PCS in Indiana, Kentucky and Ohio under the Cincinnati Bell Wireless brand name, with a tagline reference to AT&T Wireless Services. The company also announced an operating agreement with Comcast Cellular to expand IS-136 TDMA coverage across Comcast's mid-Atlantic service areas. AT&T Wireless reached agreements in principle to enter into operating contracts with Cellular One of Southwest Florida and Triton Cellular to expand digital coverage in select areas. It announced a similar agreement with Dobson Communications, under which Dobson will install TDMA technology onto its wireless properties and become part of AT&T's digital wireless network.

In June, Sprint PCS announced affiliation agreements with 10 companies in an effort to offer a seamless, all-digital nationwide PCS network. The companies were AirGate Wireless, Alamosa PCS, Brookings Municipal Utilities, Enterprise Communications, Georgia PCS Management, Horizon Personal Communications, Louisiana Unwired, Meretel Communications, Roberts Wireless Communications and Southeast PCS.

Competition between carriers ran high. Nextel announced a service option in January that took away roaming charges from customers in the 91 cities where the carrier has digital service. In May, AT&T Wireless introduced its Digital One Rate Plan, a nationwide single all-inclusive rate for wireless voice customers that eliminated roaming and long-distance charges. The same month, the carrier took a similar step with unlimited pricing plans for wireless data customers when it introduced its new monthly flat-rate pricing plans providing unlimited wireless data transfer for a variety of applications for mobile computing customers.

Sprint PCS reacted to AT&T's Digital One Rate Plan, issuing a press release, "Sprint PCS' First Quarter Growth Rate Prompts AT&T Reaction." The release claimed that since Sprint's customer-growth figures exceeded those of AT&T for the first time ever in the first quarter of 1998, AT&T's new 1-rate pricing plan was "an obvious response to Sprint PCS' pioneering efforts in the marketplace." Sprint said it had been offering what AT&T announced since January 1998 when it introduced simplified nationwide pricing, including Home-Rate USA and Toll-Free calling plans. Nevertheless, Sprint PCS introduced new all-inclusive Nationwide Service Plans in October that offer a single rate, anytime, anywhere on the wireless network. The plans offer customers long-distance calling at no additional charge and offer more included minutes.

Other carriers joined in the fray. Bell Atlantic Mobile began its DigitalChoice SingleRate USA, with pricing as low as 10¢ per minute. The carrier's Digital-Choice SingleRate East plan offers monthly access pricing starting at $39.99 a month, with no roaming or long-distance charges for calls made from within its northeastern footprint. Cellular One's Digital Edge USA package offers 1,600 minutes for $159.99. Southwestern Bell Wireless rolled out two new calling plans, offering customers in Tulsa flat rates for calls within Oklahoma.

Prepaid Interest in prepaid services sparked several new offerings this year. The Carolinas were a hot spot in February, as ALLTEL expanded its prepaid service to Florence, Lexington and Richland counties, and BellSouth Mobility DCS offered its BellSouth Prepaid-To-Go phone and service package to consumers in the Carolinas, Eastern Tennessee and Coastal Georgia.

April marked the launch of United States Cellular's Talk-Tracker, a cellular phone and prepaid wireless service. August brought several new prepaid offerings, including Bell Atlantic Mobile's Mobile-Minutes, a prepaid wireless calling service for first-time or existing customers in Upstate New York, throughout the Capital Region area, Connecticut and Massachusetts. Omnipoint introduced its No-Fee Prepay and Customer-Tailored Wireless to customers that same month, followed by Powertel's prepaid PCS offering in September to customers in all of its 26 operational markets.

Satellites The world watched several successful satellite launches this year as companies geared up to allow people around the world to make or receive calls using portable hand-held vehicle-mounted and fixed-site terminals. Globalstar launched its first four low-earth-orbiting satellites from Cape Canaveral, FL, in February, and four more in April. Iridium launched several as well. In September, Iridium introduced its system to a limited number of subscribers when it distributed 2,000 handsets to customers in a controlled service roll-out. The company commenced full commercial service Nov. 1.

Life was not perfect in the satellite world, however. May's PanAmSat Galaxy IV satellite failure affected nearly all of the nation's major paging companies. Service was disrupted for the majority of AirTouch Paging's 3.1 million customers on May 19. AirTouch estimated its costs from the failure at approximately $2 million. On Sept. 9, Global-star's attempt to launch 12 satellites failed. The company expects to have launched 32 satellites into orbit by May 1999. Globalstar plans to offer commercial service in fall 1999.

Milestones First Quarter 1998 Milestones * ALLTEL launched its first PCS service in Jacksonville, FL. * PrimeCo reached half a million subscribers. * Powertel added 38,000 customers, closing with 157,000 total PCS subscribers. * Sprint PCS reached 1 million wireless subscribers. * 3 Rivers Wireless, a subsidiary of 3 Rivers Telephone Cooperative, launched service.

Second Quarter 1998 Milestones * AirTouch added 955,000 worldwide proportionate wireless customers. * Conestoga Wireless Company began commercial operations of its PCS system. * Nextel recorded two million domestic digital subscribers. The company also added a record 400,600 digital subscriber units to bring the total to 2,042,100 domestic digital subscriber units in service. * Powertel added 25,000 customers in the second quarter, closing with 181,000 total PCS subscribers.

Other Milestones * Aerial reached 200,000 in its first full year of operation.

* BellSouth Mobility customers in Georgia pushed cellular network usage levels to all-time highs in June, July and August, exceeding more than 100 million minutes of airtime. Usage exceeded the 100-million minute mark in all three months and was up by more than 30% since January.

* Cellular One announced a 90.6% reduction of cellular fraud in the Washington/Baltimore market because of RF identification, authentication and other early fraud-detection measures.

* Bell Atlantic Mobile announced that nearly one-fourth of all new customers signing up for wireless service opt for its DigitalChoice service. Digital now accounts for almost 20% of network usage.

* Powertel hit the 200,000-subscriber mark in August. * In September, Bell Atlantic Mobile became the first wireless service provider to open a fully automated store on its web site.

January * SBC agreed to merge with Southern New England Telecommunications. The two were awaiting FCC approval by the end of 1998. * Sprint PCS acquired the remaining interest in the Sprint Spectrum/American Personal Communications partnership from American Personal Communications.

February * Rural Cellular signed a definitive stock purchase agreement to acquire Western Maine Cellular and assets of Atlantic Cellular. It received approval in July.

March * Triton PCS announced intent to purchase Vanguard Cellular's Myrtle Beach, SC, operations. The purchase was completed in July.

April * AirTouch Communications and MediaOne Group merged.

May * SBC and Ameritech agreed to merge. As of press time, the companies had begun hearings with Illinois, Indiana and Ohio state commissions, and the FCC had begun its review. * GTE agreed to purchase Bell Atlantic Mobile's minority interest in the Virginia Cellular Limited Partnership. * GTE agreed to sell its wireless interest in the GTE Mobilnet of Asheville, NC, Inc. property to Bell Atlantic Mobile.

June * AT&T signed a definitive merger agreement with TCI. * Metrocall signed a definitive agreement to acquire AT&T Wireless' Advanced Messaging Division. * United States Cellular signed a definitive agreement to acquire controlling interest in Jacksonville and Wilmington, NC, from GTE Wireless.

July * ALLTEL and 360 degrees completed their merger. * ALLTEL acquired Cellular Plus. * BAP Acquisition signed a definitive agreement to purchase the paging assets and operations of Bell Atlantic. * Bell Atlantic and GTE announced a merger. * Dobson Communications acquired Sygnet Wireless and the California 7 RSA from Southern Cellular.

August * Vanguard Cellular acquired NationPage.

September * WorldCom and MCI merged.

October * AT&T and Vanguard Cellular signed a definitive merger agreement. * Omnipoint acquired Urban Wireless' customer base. * PrimeCo agreed to sell its Hawaii PCS license and operations to Sprint. * Triton Cellular agreed to acquire Blue Mountain Cellular Telephone. * Vanguard Cellular completed the sale of its Pensacola and Fort Walton Beach, FL, markets to Wireless One Network.