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Canadians Turned on First Cellular Last Year and Turn Eye on U.S. Sales.

Canadians Turned on First Cellular Last Year and Turn Eye on US Sales

The geologist peels off his mittens and hunches low in the front seat to get his hands close to the heater before marking a phone call from his truck. "The phone works fine,' he says. "It's my fingers I'm having trouble with.'

He works for a natural gas transmission company in Alberta, Canada, where the nights are long, the air is so cold it makes your nose crackle, and it's a long drive to the nearest phone booth. He's reporting to his field office on a cellular mobile telephone.

Alberta Government Telephones, the province's phone company, has operated one of the largest mobile phone networks for almost 40 years, and has been developing a cellular system since 1976, which they initiated early last year as the first commercially operational cellular system in North America.

AGT is involved in a joint venture with Nova, an Alberta corporation, and one of Canada's largest telecommunications users--a venture that led to the formation of NovAtel Communications Limited, based in Calgary, and its US subsidiary, NovAtel Communications Incorporated in Norcross, Georgia. NovAtel is supplying all of the cellular systems, its Aurora mobile phones and related equipment for the AGT operation.

While this activity was taking place in Canada, the United States was also preparing for the new cellular technology, with the FCC setting aside 40 MHz in the 800 MHz band cellular mobile radio. This opened the way for a major market for cellular mobile phone system and the phones themselves.

So, from its US headquarters near Atlanta, NovAtel established regional offices in Atlanta, Dallas and Sacramento.

New York Getting Ready

NovAtel, as other suppliers, sees enormous opportunities in the emerging cellular field as new US systems come on line. In New York, for example, it expects that more than 50,000 New Yorkers will become mobile phone users within the first year after the area's cellular system goes into operation. The wireline service operation of NYNEX, the regional holding company created by the AT&T divestiture of New York Telephone and New England Telephone, is scheduled to turn up its system this spring.

Cellular Telephone Supply, a newly formed company, has been appointed New York distributor of the Aurora phone and plans an initial order worth more than $10 million.

David Frye, vice president of NovAtel's US operations, predicts that, nationally, cellular mobile radio will be "a $4-billion market by 1987, and that figure may even be on the low side.' He points to the Chicago market in which sales are running about two and a half times higher than most initial forecasts (see story on that first US commercial cellular system beginning on page 60).

Frye points out that the Aurora handset can operate on IMTS as well as cellular with the addition of the appropriate radio frequency software packages. Dr. Arunas Slekys, NovAtel vice president for research and development, sees this as "an important advantage at this stage of cellular development. It means that people who want mobile phone service now in an IMTS area will not have to buy an additional handset when cellular service comes along. It also means that Aurora phone users can roam from cellular to IMTS areas, using the same handset.'

Slekys also sees cellular communications technology creating an "unwired world' in which the interface with the existing telecommunications system "can completely eliminate the user's dependency on access terminals that are shackled by wires to the system.'

He also foresees the day, in the near future, when microcells will be used in local area networks in office buildings, using a base station that costs no more than a good stereo system. "We are looking at ways to put a cell on each floor of a building, like a layer cake,' he explains. "Only not every floor will require a different cell, because our technology will let you re-use cells, so that a nine-story building might have not only three cells.'

Slekys says that the combination of radio frequency and digital technology, plus the incorporation of data compression technology, can expand bandwidth capacity at a 12 to 1 ratio. "We could put 1.2 million users on a bandwidth that can now handle only 100,000.'

According to Peter Zuyus, NovAtel's sales director for the US, based on 50,000 cellular subscribers in New York in the first year, phone sales could come to $100 million. That figure, he admits, "is based on a low-side phone price of $2,000. By the end of the first year, we expect to see a drop in the price of mobile phones, partly because of production economies and partly because of technological innovations.'

"If you think I'm turning the Big Apple into a big apple pie in the sky,' he adds, "before World War II, only half of all American homes had telephones. Now 96 percent of homes have phones. And in 1950, only nine percent of homes had television. Now there is at least one TV set in 98 percent of our homes.'
COPYRIGHT 1984 Nelson Publishing
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1984 Gale, Cengage Learning. All rights reserved.

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Publication:Communications News
Date:Feb 1, 1984
Previous Article:Coming Soon: A Cellular Radio System Near You.
Next Article:Business Users the First to Benefit from the Promise of Cellular Radio.

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