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January 11, 1987


By CBR Staff Writer

Racal Vodafone, British Telecommunications Plc and Plessey Co are all positioning themselves to ensure a solid place in the planned pan-European cellular telephone network. Vodafone is in the evaluation team along with British Telecom for the proposals being submitted now for the system and it expects a defined proposal to emerge during 1987. By its acquisition of Millicom Inc’s 15% stake in the Racal-Millicom cellular radio mobile telephone holding company for the Vodafone network, Racal Electronics Plc has pre-empted the possibility of an unwanted partner entering the party, possibly a US Baby Bell, and in the words of Racal Telecommunications chairman Gerry Whent it allows us to remain flexible in the future. He sees the fact that as a result of the deal it will have 100% of the Vodafone operation, as a development which eases its entry – with new partners – into the continental European market, where a new digital cellular system is slowly emerging. Racal is aiming to be part of one of the two or three consortia of companies which Whent anticipates will run the digital cellular market in Europe and it may or may not use shares in Vodafone to trade for its place. We expect the new system to be a hybrid of the proposals being drawn up and evaluated now and a number of countries will cooperate to produce the software, base stations and subscriber equipment. We are not sure yet whether we will simply act as an operator or whether we will manufacture and design equipment. But we will be part of it. Proposals for the digital system are now being drawn up by some six groups throughout Europe. One proposal comes from Scandinavia, there are two joint Franco-German proposals of one type and two other Franco-German proposals for a second type – and the test bed for them is in the UK, co-ordinated by Racal and British Telecom in London. In Whent’s words, a damned good place to test it given the amount of cellular traffic which goes through the capital. It is feasible that Racal may find itself in the same consortium as British Telecom, which runs the UK Cellnet cellular network in conjunction with Securicor in fierce competition with Vodafone. Whent says there is no reason why the they should not both buy the same equipment, but the difference is that while Telecom is not interested in design and manufacture of equipment, Racal very definitely is. Plessey is carrying out the study for the project with financial backing from the Department of Trade and Industry, and most of the physical testing is going on in Paris. Technical director of Plessey Telecommunications Professor Gosling says the company intends to make and supply equipment for the network, from switching equipment to base stations and mobile phones. Once the digital service is under way, there will be a lot of interest in switching from the established analogue systems to the new and there will be a relatively long transition between the two. Professor Gosling sees the System 250-based Ptarmigan radio communications switch manufactured by Plessey for the military communications area – and derived from Plessey’s old PP250 unsuccessful contender for System X – as a possibility for the basis of such a switch since much of the technology for the new system will derive from the military field.

Racal quietly confident

He also points to the possibilities offered by Plessey’s ISDX PABX, which handles voice and data. Plessey is now working on equalisers to cope with both narrow bandwidth – 200KHz for example – and very wide bandwidth – up to several MegaHertz. Getting speech coded from a 16Kbps stream to a 64Kbps stream is another crucial part of Plessey’s work. But will the pan-European system ever come off? Certainly Professor Gosling expressed scepticism at a Stockholm conference early in 1986 about the project. Europe has a long history of not being able to establish Europe-wide standards. In their desire to support European industry, European governments tend to give way to the pressure of overseas standards. My message at Stockholm was that we should not be

over-ambitious to start with. We should work on a good acceptable standard. Racal is quietly confident, saying that it may not be possible to achieve a single system within the timescale hoped for, but that at any rate Europe should not go for too complicated a system – it is difficult enough to get the equipment we have now working effectively. Is Racal interested in taking a stake in a US cellular operation? Whent reckons that Europe is enough for the company to handle at present but says that if the US goes digital in the late 1990s, he hopes that Racal would play a part there. The analogue Vodafone network will continue to operate until into the 1990s, but will eventually be replaced by the digital network with according to Racal, a seven or eight year transition period starting somewhere around 1995.

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