Racal Vodafone, the Racal Telecom Plc cellular phone subsidiary, is confident that Personal Communications Networks pose no serious threat to its network. At the moment around 600,000 people are signed up on the network, and Racal expects this to grow to 700,000 by next March. This outstrips the 460,500 on British Telecom’s Cellnet. But personal communications network operators could give Racal a harder run for its money than British Telecom. Personal Communication Network is the name that has been given to the new digital radio networks to be set up in the 1.7GHz to 1.8GHz waveband, which was freed by the UK government for such purposes last year. The major differences between the personal nets and existing radio networks is the ultra-high frequency at which the latter operate, which has much greater capacity than the band allocated to cellular – a whole 100MHz is available – and, perhaps more importantly, the reportedly lower call tariffs they will charge.
Comparable in price
Making a local call on a personal net should be comparable in price to making one over the public switched network. And making one long distance will be cheaper than using the existing cellular network. Handsets will also be cheaper than existing cellular equivalents. Unitel, one of the companies set up to run a Personal Communications Network, has quoted UKP250 for a radio handset. The cellular equivalent costs around UKP400. So one could be forgiven for thinking that Racal and Cellnet will suffer considerably when the networks are up and running. The three operators that have been licensed to set up such networks are made up of consortia of various telecommunications companies. Microtel Communications Ltd is led by British Aerospace Space Systems Ltd and includes Pacific Telesis UK PCN Ltd, Millicom UK Ltd and Matra Communication SA. Mercury PCN consists of Cable & Wireless Plc’s Mercury Communications and Telefonica de Espana SA, while the Unitel group carries the interests of STC Plc, Thorn EMI Plc, US West Inc and West Germany’s Deutsche Bundespost Telekom. Racal says it did not even bid for a licence, because as a licensed Public Telephone Operator, it wasn’t necessary. Communications manager Terry Barwick says that Racal already had permission to set up a personal network. But this is not on the 1.7GHz to 1.8GHz waveband to be used by the three new operators. –
By Sonya McGilchrist
The Department of Trade & Industry precluded Racal from bidding for a licence to run a service on this frequency. And according to Unitel, it is the particular radio frequency which makes all the difference. Unitel’s Alan Thompson says that the span of radio spectrum allocated to each Personal Communications Network company is far greater than the spectrum used by cellular operators. This means that operators can potentially sign up 10m customers without any of the quality-of-service problems that, Thompson says, are associated with existing cellphones. The two cellular operators have around 1m customers and Thompson reckons that even this number causes quality problems at peak hours because of congestion. Supply, he says, is not able to equal demand. Terry Barwick at Racal admits that Vodafone might appear to have been left out of the Personal Communications Network party – we almost had to remind the government that we didn’t need a licence. Racal will be setting up a network of its own on the 900MHz band, but it will not be on the same scale as other operators. The Racal system will operate only in towns and cities with populations of 20,000 or more. Between those areas on the motorway or on train journeys – users will have to switch to Racal’s existing cellular network. And handsets will be not be immediately compatible. If you want to switch from Racal’s existing cellular network to the town-based personal communications nets, then you will have to place an adaptor on the phone. And vice versa. The adaptors have not been priced yet. Call costs on both the three planned networks and Racal’s supplementary micro network are shrouded in percentages and w
ords such as competitive and comparable. The cost of a peak rate call on the Vodafone network is currently 33p per minute in the M25 area, 25p outside that area. Racal has said that the cost of a call on its local personal net will be 80% of the cost of a Vodafone call. Taking the 25p rate, this would work out at around 20p. Racal has also stated that rates on the existing macro network are unlikely to change. Back in November, Unitel claimed it would charge a peak time call rate of 5p per minute for a local call, rising to 24p long distance. Now, however, it seems to have abandoned those figures in favour of more imprecise information, saying only that long distance calls will be cheaper than using the cellular network. Locally, it says, the calls will compare with British Telecom rates – but taking into consideration the extra services offered by a personal net.
European flights
One great advantage that Racal’s system will have over others is its compatibility with the forthcoming, pan-European, Groupe Speciale Mobile network, which will also operate on the 900MHz band. This means that users of Vodafone (or Cellnet) will be able to use their handsets in Europe and on European flights, a big bonus for 1992-orientated travelling business people. But even before the networks are launched, the three British personal net operators are throwing dwon the gauntlet and have come up with a Groupe Speciale Mobilebased standard for the 1.8GHz frequency, on which they hope to base a memorandum of understanding with prospective European personal network operators. The memorandum, if accepted, would be the first step to establishing a pan-European Personal Communications Network. The 900MHz Pan-European digital cellular network should be in operation at the start of 1992 while personal communications networks are set to be launched at the end of 1992. But whatever happens to Vodafone, Cellnet and the three new operators, one thing is for certain – real competition in the telecommunications market can only mean a better deal for the customer.
