|Issue:||Latin America I 1998|
|Topic:||Commercial Trunked Radio in Latin America:The ‘Other’ Wireless System|
|Author:||Alan R. Shark|
|Title:||President & CEO|
|Organisation:||IMTA, Washington, DC, USA|
Commercial trunked radio is a significant segment of the overall mobile wireless industry, which has only recently begun to receive worldwide attention. Already more than 200 companies have licenses to operate them in Latin America. IMTA reveals three prevailing trends in the way in which commercial radio technologies are being implemented and used in the region. IMTA’s first comprehensive study of the industry worldwide confirms its belief that the industry is experiencing significant growth.
The International Mobile Telecommunications Association (IMTA) coined the term ‘commercial trunked radio’ in an attempt to create a universal definition encompassing the many names for the industry it represents and to identify a specific kind of wireless service. And unlike cellular and PCS, where the infrastructure costs alone limit opportunities to a few, commercial trunked radio growth opportunities are exploding all over the world, and especially in Latin America. The commercial trunked radio industry consists of wireless radio communications systems, which employ either conventional or frequency-trunked technology. Historically, these systems have provided one-to-many and many-to-one mobile wireless voice communications services, also known as mobile dispatch services. They are usually operated by commercial entities, commonly called service providers, who provide and resell their services to other entities for a profit. Commercial trunked radio is a significant segment of the overall mobile wireless industry, which has only recently begun to receive worldwide attention. This is because commercial trunked radio systems usually serve a very specific user group, rather than the public at large, and the major growth of the industry has occurred only within the last 6 years. Comprehensive study IMTA has completed the first comprehensive study of the commercial trunked radio industry worldwide and the results confirm that the industry is experiencing significant growth throughout the globe. By the end of 1998 IMTA estimates that there will be 8.36 million units in service worldwide, with over 500,000 units becoming operational in Latin America. From 1994 to 1995, the Latin American industry increased its subscriber base by 81 %. This number will most likely double in the next 2 to 3 years. At this time, more than 200 companies have licenses to operate commercial trunked radio systems in the following Latin American countries – Argentina, Brazil, Chile, Colombia, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Peru and Venezuela. Three Prevailing Trends IMTA believes there are three prevailing trends in the way in which commercial radio technologies are being implemented to meet customer needs in Latin America. Single-site Systems First, in the small cities and towns, there is a trend toward implementing single-site systems to provide service and build up the commercial trunked radio market. In these areas, the telecommunications availability is so limited that demand can often be satisfied by the implementation of a small system offering a limited amount of features and services. In addition, because the potential number of users is relatively low it is financially sound to implement a low-cost system. Examples of places where single-site systems are in demand include Ecuador, El Salvador and Bolivia. In these situations, two-way radios may be used by individuals who do not have access to any other form of telecommunications systems, or companies who want to improve efficiency and productivity by being able to communicate instantaneously with their workforce. Wide-Area Trunking Second, in secondary and tertiary cities there is a more prevalent demand for wide-area trunking and networking systems as an expansion of analogue systems already in operation. In the cities where some analogue systems already exist, many operators are looking for multi site networking capabilities and features that are associated with digital systems but can be provided by sophisticated analogue systems. Some examples are Enhanced Sub-Audible Signalling (ESAS®) manufactured by Uniden America Corp and SMRLink® manufactured by SmartLink Development LP. While ESAS systems may also be installed in a single-site environment, the wide-area networking system provides these additional features: unique individual ids; automatic registration; private half and full duplex calls; fixed or dynamic call limits; seamless wide-area networking; priority access; least-cost routing, and multi-site dispatching. With the development of systems like this, which allow for wide-area dispatch systems, an operator can network a huge area at a lower cost than implementing a small digital network. This provides many operators the increased geographic coverage many customers demand as well as the additional features which they find attractive. The majority of commercial trunked radio operators in Latin America offer their services via conventional and trunked analogue systems. The primary analogue equipment protocols in use in the region are Logic Trunked Radio (LTR®), MPT 1327, Selectone™, SmartNet™ and SmarTrunk™. According to IMTA’s Global Digest for Commercial Trunked Radio Systems, major equipment suppliers to the region are Celwave, EF Johnson, Ericsson, Kenwood, Motorola, Selectone, SmarTrunk, Uniden, Yaesu and Zetron. Digital Systems The third trend is the implementation of digital systems in the region in order to achieve high levels of system capacity in areas where demand is considered to be high and spectrum is available at a premium or not available at all. At the same time, the experience of users with cellular and other wireless services has enhanced their desire to have access to more integrated services. Digital systems are already in operation in several countries in Latin America with more planned for 1998. The digital systems currently in operation in Argentina and Brazil are Enhanced Digital Access Communications Systems (EDACS™), manufactured by Ericsson. An integrated Digital Enhanced Network (iDEN™) system, which is manufactured by Motorola, is already in operation in Colombia and additional systems are to begin operation in Argentina, Brazil and Mexico this year. Digital systems also allow for wide-area geographic coverage and more integrated services. Additional system capability has also allowed for the subscriber unit to be made smaller and the battery life to be made longer, both attractive features. One example is the Motorola iDEN™ system, which has already developed its third generation radio which weighs only 6.9 oz. And smaller handsets are on the way. Digital systems also allow for seamless wide-area roaming which is an attractive feature for certain business users, such as transportation companies. Data Collection These systems are most appropriate in areas where the population is very dense because they cost significantly more than analogue systems and, unless there is significant demand, it may take longer to arrive at a financial break-even point. For example, the iDEN™ system being installed in Brazil will initially cover the Sao Paulo metropolitan area which has a population of 20 million, with expansion plans for Rio de Janeiro which has a population of 12 million. Due to the fact that digital systems can allow for additional capacity, digital operators anticipate high levels of loading on their systems from the first year in which they will be in operation. Conclusion These three trends help explain some of the reasons behind the rapid growth. IMTA has collected data on customer profiles and has found that typically the customers of trunked systems are using their systems for business to business communications.