Throwing down the gauntlet to those Telepoint operators that consider the Personal Communications Network to be more a thing of the 2000s than the 1990s, the British Aerospace-led PCN consortium yesterday declared that it will have a genuine, mass personal communications service up and running by the end of 1992. The promise was made at the announcement of a newly-formed joint venture company, Microtel Communications Ltd, which is to carry the PCN interests of British Aerospace Space Systems Ltd, Pacific Telesis UK PCN Ltd, Millicom UK Ltd and Matra Communication SA, each of which holds equity shares in the new company. The consortium was one of three groups to win a PCN licence from the Department of Trade and Industry last December, along with the Mercury Communications Telefonica de Espana consortium Mercury PCN and the STC-led Unitel group: originally only two licences were on offer, but the British Aerospace bid finally gained acceptance after some lobbying on its behalf from the Office of Telecommunications UK watchdog. At present, 21% of the equity in Microtel is still up for grabs, with British Aerospace proposing to take on 35% of the final holding, Pacific Telesis 20%, Millicom 14%, and Matra 10%; Sony, IBA Engineering and Lytel are also involved with Microtel as formal associates. Microtel’s chairman Sir Graham Day, who also chairs Cadbury-Schweppes Plc and the Rover Group Plc arm of British Aerospace, told the conference that it was invited not to conclude that the remaining 21% was there simply to raise funds: a number of potential suitors had already made advances to Microtel, which was most willing to consider those that could help in the distribution and marketing of the service; it was claimed that equipment suppliers and financial institions were out of the running completely. Financial commitment was, for the moment, nominal, but in the run-up to 1992, Microtel was budgeting to put a total of UKP1,200m into the project. Based on the pan-European Groupe Speciale Mobile specification still up for ratification, the Microtel service puts much emphasis on the use of Smart Cards with the individual handsets: the personalised Smart Cards will provide a number of charging options and personal identification number-based security after the style of credit cards, as well as allowing callers to use handsets other than their own and dealing with the associated billing complexities. The initial network is projected to be in place within the next two years, at which time it will go live with coverage extending to about half of the UK population. Value-added services such as mailbox messaging, caller identification, support for private branch exchange features and data communication applications will follow, with the full service available to the whole country by the year 2000. Microtel intends to use distributors to market the service, but, in the effort to avoid the consumer exploitation that was associated with the cellular market, is planning to create a database system allowing support and service information to be exchanged between Microtel and its distributors; it was, however, ackowledged that this method of support could be a big problem in the mass market context of PCN.

Big assumption

Microtel chief executive James Blake, former president of Pactel Cellular Midwest, conceded that the schedule for 1992 was very ambitious, and was contingent on the Groupe Speciale Mobile specification being finalised by the end of 1990, as well as a quick settlement of the frequency allocation issue. In common with the other PCN consortia, Microtel promised tariffs that would be competitive with the public switched telephone network, but that would involve a premium related to the added value of PCN; and, given the competitive market place that Microtel claimed it wanted, the price of handsets would fall to under UKP100 by the mid-1990s. Assuming – and it is a big assumption – that all these criteria are fulfilled, Microtel expects to be selling its service into a UK market totalling 10m to 15m subscribers in 10

years’ time.