Value-Added Features | Voice Communications

There are a number of value-added features that are implemented by the service provider's network. Some of these features may require a specific type of handset to access.

Over-the-air activation

Over-the-air activation or over-the-air service provisioning allows a potential wireless, both cellular and PCS, service subscriber to activate new wireless service without the intervention of a third party (e.g., authorized dealer). New software from Lucent Technologies, for example, enables wireless service providers to offer over-the-air service provisioning capabilities—including initial activation—plus provisioning of other innovative wireless features, such as paging and voice mail. The process is made secure by restricting the phone's initial use to activation only. Once subscribers have the phone in hand, they can immediately dial a customer service representative who can activate the phone and accept account information.

Over-the-air activation also enables the service provider to activate a potential service subscriber's unit by downloading over the air the required parameters, such phone number and features, into the unit. The service subscriber does not have to bring the unit into a dealer or service agent. This allows service providers the capability to start marketing subscriber units through nontraditional mass-market retailers, who do not have the personnel to individually program subscriber units.

Another capability of over-the-air activation is the ability to load an authentication key into a subscriber unit securely. Authentication is the process by which information is exchanged between a subscriber unit and the network for the purpose of confirming and validating the identity of the subscriber unit. The over-the-air activation feature incorporates an authentication key exchange agreement algorithm. This algorithm enhances security for the subscriber and reduces the potential for fraudulent use of cellular service.

New customers simply place a call to the cellular operator, and the information is transferred automatically to the cellular phone over the cellular airwaves. This method of activation enables cellular operators to explore new distribution channels for subscriber units and substantially reduce distribution and service provisioning costs.

In 1995, CDMA became the first digital cellular technology to offer instant activation to customers based on specifications defined by the CDMA Development Group (CDG) in 1994. The downloading capabilities use a flexible transport protocol that is easily adaptable. In the future, cellular operators may use this capability to forward other information to cellular customers, providing them with the latest applications software coming directly from the CDMA network. A possible application could be automatically updating roaming information to give customers easy access to CDMA systems nationwide.

Over-the-air programming

Cellular service subscribers can activate and modify their own cellular phones without third-party involvement. Among the vendors offering systems that support over-the-air programming is Lucent Technologies, which offers its AUTOPLEX Series II cell sites with Digital Control Channel (DCC) software based on the IS-136 standard. The system enables cellular service providers to offer enhanced features and services over existing TDMA-based digital cellular telephone networks. DCC allows cellular operators to offer the latest in digital wireless services, including over-the-air programming, tailored to individual subscriber needs. It interworks with existing analog infrastructure, providing operators a gradual and cost effective migration to digital. Nortel (Northern Telecom) also supports the Digital Control Channel in its DMS-MTX wireless systems.

In addition to over-the-air programming, DCC supports such advanced services as Calling Line ID, Message Waiting Indication, and Short Message Service. It also offers Tiered Services, allowing operators to tailor pricing packages for residential and business customers based on location and usage. Sleep Mode, another DCC feature, improves handset battery life as much as three times over existing cellular phones by allowing IS-136 phones to "sleep" while idle. DCC also improves network performance, and supports advanced voice coder technology for improved audio quality.

Cellular voice authorization

Cellular voice authorization uses an individual's voice print to prevent access to cellular phones by unauthorized users. With this application, cellular carriers can more effectively fight thieves who detect a cellular phone's unique identification codes, then embed the codes in other cellular phones. When these illegal phones are used, the airtime and long distance calls are charged to the original owner—a problem that causes losses of more than $1 million a day for the cellular industry.

One manufacturer of cellular voice authentication technology is Texas Instruments. The technology is premised on the fact that every person has a distinct voice print. Before allowing a user to access a cellular network, the system requires the caller to speak a user-selectable PIN (personal identification number). Cellular Voice Authorization then compares the voice sample that is spoken against stored samples of the individuals voice print. The user can access the network and place cellular calls only if the spoken sample matches the stored samples.

By attacking fraud before it occurs, cellular voice authorization prevents losses that must be absorbed by cellular carriers or paid by subscribers (if the fraud goes undetected on their phone bill). Voice authorization technology also eliminates the inconvenience of having to reprogram a phone with a new number after its identification numbers have been fraudulently duplicated. This avoids interruption of service for the customer.

Voice mail

Voice mail is among the newest capabilities being added to wireless services. It is basically a computerized answering service. When accessed, it plays a greeting and records a message. Depending on the sophistication of the service, it can notify the subscriber via an audio tone, on-screen icon, or a pager that a new message has been received. After the subscriber retrieves the messages, they can be replayed, saved, deleted, replied to, or forwarded to another subscriber on the same network who also has voice mail. In addition, the user may skip to the next message and move forward or move backward through all of the messages.

Voice mail can be useful in many situations. It enables callers to leave messages when the subscriber's handset is turned off or out of range, or when the subscriber is busy with another call and does not want to be interrupted. Voice mail is also useful when it is inconvenient or unsafe to answer the car phone. Voice mail can even be used by the subscriber to leave personal reminders.

Nextel is one of the wireless services that supports voice mail. When a call cannot go through, for whatever reason, the caller is given the option of leaving a voice message via Nextel's Voice Mail service. Messages may be up to 5 minutes in length. Users of the company's Lingo or PowerFone handsets are notified of new messages through an on-screen icon and audio tone. The on-screen notification indicates the number and type of messages (voice or text) that are waiting. This eliminates unnecessary calls to check Voice Mail.

Voice messages may be retrieved any time using either the handset or a conventional wireline phone. Depending on the service provider, airtime rates may apply to message retrieval over the wireless network, although there is usually no charge for retrieving messages via wireline phones. Messages are held in storage on the network for 30 days, after which they are deleted. The PowerFone stores up to 16 voice messages and numeric pages. For added convenience, pre-programmed speed dial numbers provide easy voice mail retrieval from the handset.

Conference calling

The ability to set up a wireless connection between three or more parties is a relatively new capability offered by today's advanced wireless networks. In its most basic form, this capability is known as three-way calling in which a subscriber establishes connections with two other parties for a conference call. When either of the two parties hangs up, the connection is maintained until the call originator hangs up. Among the carriers that offer three-way calling is AT&T Wireless. The company offers three-way calling to subscribers of its nationwide 800-MHz Digital PCS network. The rate plans include three-way calling, as well as call forwarding, call waiting, and detail billing, at no extra charge.

Nextel offers a more sophisticated version of conference calling. The Direct Connect feature allows PowerFone users to communicate with up to 100 individuals at a time. The user simply programs into the PowerFone the individuals and groups of people they talk to most frequently. When the user needs to reach any individual or group, he or she simply scrolls to them on the PowerFone display screen, and presses the Direct Connect button to be instantly connected.

The following Direct Connect capabilities for establishing conference calls are available over the Nextel network:

  • Private call establishes a call with another person with the push of a button.
  • Group call allows the user to set up and select a talk group. Pressing the Nextel Direct Connect button establishes the connection with everyone in the group. Up to 30 groups can be programmed into the PowerFone.
  • Intercompany private call lets users from different companies communicate by way of the private call feature. It is intended for those who are collaborating on projects, such as contractors and workgroups. It works just like private call in that all parties are connected with the push of a button.
  • Call alert lets the caller send a visual/audible alert to the recipient's phone. The recipient can answer the call by pressing the Direct Connect button, whereupon both parties are instantly in touch.

Mailbox on demand

Another value-added service that is being offered in conjunction with wireless services is the virtual mailbox, or mailbox on demand (MBOD). Like other value-added services, (MBOD) is implemented with a subsystem that is integrated with the carrier's wireless switch. Centigram's Series 6 communications server, for example, provides MBOD as part of its MobileManager applications suite for wireless carriers.

MBOD answers the phone and takes messages for both cellular and landline customers whose lines are busy or go unanswered. MBOD is an application aimed at the 90 percent of residential subscribers and the 50 percent of cellular subscribers who have not purchased voice mailboxes. MBOD provides the benefit of messaging options to subscribers, and may increase the number of subscribers migrating to monthly messaging services.

Even if subscribers have answering machines to take messages, MBOD will answer the call when the answering machine is busy or when the subscriber ignores a call waiting tone and lets the incoming call go unanswered. Once MBOD takes one or more messages for the subscriber, it will notify the person that messages are waiting and deliver those messages automatically.

To notify subscribers of new messages, the Series 6 can call them and deliver the recorded messages. In a cellular network the Centigram system can send a message to a Short Message Service (SMS) Center, which delivers a text message to the subscriber's handset, notifying them of a new message.

In a cellular environment, MBOD can capture and take messages for the traditional 15 percent of calls which go unanswered. On the wireline side, where an even greater percentage of calls are busy or unanswered, MBOD is better than an answering machine because it takes and delivers a message when a subscriber's phone is busy, so uncompleted call traffic will decrease with each message delivered. In all networks, MBOD decreases the number of uncompleted, unchargeable call attempts because every call is completed on the first try.

Personal number service

Personal number service integrates voice, fax, and follow-me capabilities into a single telephone number, such as a subscriber's established pager number. Personal number service enables subscribers to have a single telephone number which will seamlessly route communications to people on the move at their mobile, office, and home telephone numbers, pager, and any other number in the world.

Phone Features | Voice Communications

In addition to the basic issues of portability, power, durability, and reliability that are certainly key decision points when selecting a cellular telephone, it is often additional features and options that distinguish one unit from another. The cost of the unit is certainly a major factor for many purchasers, and identical units can vary greatly in cost, especially when bundled with cellular network service commitments. On a straight purchase basis, cellular telephone list prices can range from under $100 to $800 and above. Competition has fostered aggressive discounting, and additionally, service providers offer telephones at discount or at no cost, in exchange for a commitment to utilize their network service over a specified period of time.

Call handling features

There are many call handling features that are offered by wireless service providers that facilitate ease of use or offer added value. Some of these features are standard in that they are supported throughout the entire range of handsets and usually do not involve extra charges. Other call handling features require that the subscriber have the right kind of handset to access them. Many value-added features are considered options and may entail extra charges. However, due to increasing competition, some value-added features that were once considered extra-cost options are now being offered free to attract new customers. This situation is constantly changing; first-time subscribers should compare service providers in their area for the latest developments.

Among the basic call handling features offered by many wireless service providers at no extra charge are:

  • Call hold permits the phone user to momentarily put an existing call on hold while he or she attends to another task.
  • Call waiting provides an indication of an incoming call while the user is busy with another call.
  • Call forwarding allows incoming calls to be forwarded to any designated wireless or wireline phone.
  • Call alert provides audio and/or visual indication of an attempted call.
  • Silent call alert includes visual or vibrating notification in lieu of an audible signal. This can be particularly useful in locations where the sound of a ringing phone would constitute an annoyance.
  • Single-button callback allows the subscriber, at a convenient time, to press a single button to call back a person who left a call alert.
  • Do not disturb enables a subscriber who is busy with a conference call to set the handset to disable the call alert feature. This prevents the subscriber from becoming distracted by call attempts.
  • Last number redial allows the phone user to redial the last number called with the push of a button instead of having to redial all the digits.
  • Selective call restriction permits the user to program the phone to disallow calls to specified country codes, area codes, exchanges, or telephone numbers. However, calls will still go through to emergency numbers.
  • Phone list stores speed dial numbers. Depending on the memory capacity of the particular handset, 100 or more speed dial numbers may be stored.
  • Character mapping allows easy recall of important phone numbers. This feature allows the actual names of individuals to be used instead of their telephone numbers. As many as 11 characters may be used.
  • Extended telephone numbers allows up to 20 digits to be entered as part of the telephone number to include an extension or other information, as well as an 11-digit long distance number.

Convenience features

Today's wireless handsets are equipped with a number of features that make them more convenient to use. Hands-free operation, for example, is especially useful for mobile users in terms of safety as well as convenience. This is equivalent to a speakerphone function on a conventional telephone. In its basic configuration, it allows the user to converse without holding the handset after the call has been established.

A remote earphone/microphone combination cable is available that can be plugged into some phones. This allows the user hands-free operation and provides confidentiality for at least the received side of the conversation. A portable phone can be attached to the user's belt, and the earphone/microphone cable plugs into the telephone.

One of the newest innovations in hands-free operation is the inclusion of a proximity detector located next to the earpiece in the handset. The proximity detector emits an infrared beam and senses a reflection when the handset is brought close to a person's ear. A digital signal processor (DSP) equalizer then automatically lowers both the receive and transmit volumes to levels that ensure the privacy of the call. The transition is so smooth that the listener on the other end of the call will not notice any difference in sound quality or sense that a switchover between handset and hands-free operation has taken place.

To improve the audio quality of hands-free communication, the ported loudspeaker has been developed to eliminate the "canned" sound most people experience with hands-free operation. The ported loudspeaker, normally found in home stereo systems, has a tube that penetrates the sealed mounting enclosure. The tube is designed so that the air column inside resonates to amplify lower frequencies, providing a better bass response. The ported loudspeaker has now been adapted for use as a receiver in compact cellular phones for both handset and hands-free operation. Frequency shaping is dynamically controlled in response to the mode of operation with the result that sound quality remains the same.

A related convenience feature is voice activated dialing, which combines speed dialing with voice recognition technology. It permits users to dial a phone number with one or two buttons and speak into the handset or vizor-mounted system instead of punching in the full telephone number on the keypad. Since users can assign names to phone numbers, they do not even have to remember each person's phone number or fumble around looking for them in an address book.

Speech recognition technology enables the user to program important phone numbers into the phone and equate each number with a spoken command. For example, by pressing two digits and using voice commands such as "Call office" or "Call attorney," the cellular phone will initiate dialing and place the call. Such systems also accept number and command imprints in different languages. Users can even create a directory of personalized listings. Depending on the system used, 20 or more listings can be stored in the cell phone for voice activated dialing.

In addition to stored commands, users can also voice-dial a number by saying "Dial" and stating the number. Access codes allow customers to activate automated systems, such as voice mail back at the office, without pressing any additional keys once the automated system answers.

Handset features

Handsets are becoming increasing sophisticated. Among the areas undergoing rapid technological advancement is the handset display. Traditionally, wireless telephone displays have employed relatively low-contrast passive matrix technology to minimize costs and power consumption. However, as wireless services are increasingly used for electronic transactions (such as home banking and shopping), short message services, Internet access, image transfer, and possibly full-motion video applications, high-performance passive matrix displays are being added to wireless handsets.

Among the technologies being used to improve handset displays is film super-twisted nematic (FSTN), a polymer optical compensation film that is laminated to the viewing screen to sharpen the contrast and deliver neutral black-white renditions. The film corrects for out-of-phase wavelengths that typically arise on systems using conventional STN technology.

Another technology being pursued by some vendors is a new class of low-cost color liquid crystal display (LCD). For many emerging telephony applications, color can provide additional visual indications to help users quickly navigate their way through increasing amounts of screen-based information. Different colors, for example, can be used to partition or layer information into categories for quicker identification and access. Color can be employed to highlight particular information on a crowded display screen, or to emphasize warning signals and important events, such as low battery power or signal strength.

For such applications as portable wireless telephony, where power consumption and backlighting requirements impose severe limitations, the use of reflective color technology is being explored as an alternative to existing color LCDs. This relatively new technology uses a special liquid crystal material that enables color to be determined simply through applied voltage—the same way that lower-cost LCD monochrome displays are controlled. Reflective color technology eliminates the color filters required in traditional color LCDs, which subdivide each pixel into three subpixels—red, green, and blue—and use three filters to vary the intensity of these primary colors in the color mix. In reflective color systems, each pixel generates its own color in response to the applied voltage.

Unlike traditional color LCDs, the reflective color system requires little additional power, no extra backlighting, and costs only about 10 percent more than LCD monochrome displays. Although the technology today provides a limited number of colors—compared to the 256 in a standard notebook computer display—advances in display technology will soon push the number of available colors much higher. Even with a restricted color palette, reflective color is adequate for use in the graphics-and-text interface appropriate for most telephony applications.

Touchscreen technology is another area being improved for such applications as e-mail and messaging. With this technology, users can directly enter, select, or highlight data on a touch-sensitive screen by pressing on-screen buttons next to the displayed information or by writing with a stylus (pen) instead of having to use the alphanumeric keypad. A stylus could be paired with handwriting recognition, for example, to let users bypass the keypad when entering names and numbers into a directory.

As screen phones are increasingly used in homes or other environments where lighting may be dim or nonexistent, vendors are using high-efficiency light-emitting diodes (LEDs) and lightpiping to backlight LCDs and illuminate buttons and status indicators. Rather than locate the LEDs directly behind the LCD, vendors such as Nortel are placing an LED array to one side of the LCD and employing a lightguide in back of the screen to evenly distribute illumination over the entire display. A pattern of dots is printed on the flat plastic lightguide to diffuse the light and eliminate hot spots of illumination typical in conventional handsets. This solution reduces the number of LEDs in a normal phone display from 100 or more to just eight, which greatly reduces both the power demands and the cost of the handsets.

A number of other features inherent to the handset itself make various tasks easier to perform. Among these features are:

  • Call timer provides the subscriber with information on the duration of a call. Some telephones can also maintain a running total of airtime for all calls. These features make it easier for users to keep track of call charges.
  • Visual status displays convey a variety of information such as number dialed, state of battery charge, call duration, signal strength, roaming, and operational errors.
  • Keypad lock enables the subscriber to prevent unauthorized calls by password protecting the keypad.

With the increased use of cellular telephones for personal use, the choice of color and styling is playing a greater role in handset selection, particularly for fashion-conscious young people. For example, some Motorola handsets come in such diverse colors as sunstreak (yellow), dark spruce, eggplant, teal, raspberry, regatta blue, temptation teal, and cranberry. Not to be outdone, Nokia's 1998 color palette includes high-gloss and brushed metallic finishes such as midnight black, hunter green, turbo red, pewter, antique bronze, and signal glow, to name a few.

Types of Phones | Voice Communications

Although different types of phones require the same basic system components to allow a standard level of operation with the cellular network, significant differences between mobile, transportable, and handheld units can most often create the major decision points as to which is right for any specific application.

Mobile units

Mobile units are permanently installed in a vehicle, usually by the provider of the equipment, and typically consist of "bolted-in" components. This type of installation generally involves installing the equipment and routing the cables so that they will not be damaged as part of the normal use of the vehicle. Cables and equipment are placed and secured so that cargo and people cannot easily displace them. Since the system is subject to continuous vibration and the rough jolts caused by road hazards, potholes, and other everyday occurrences, the installation should typify equipment that might be factory installed, and some manufacturers have in fact offered this as an option. Since space in the driver's area is at a premium, the handset is typically mounted to be accessible to the driver, and the other components can be installed elsewhere in the car.

As noted, mobile units utilize the vehicle's 12-V DC battery as a power source. Mobile phone transmitters generally operate at a full 3-W level, the maximum for cellular units. This provides the best available overall performance in terms of signal quality and physical range of use. The transmitter output power level is very dependent upon a strong input power source.

Transportable units

Transportable phones comprise the same components as the mobile telephones but are packaged as a single unit. The transportables are generally used in vehicles by plugging them into the cigarette lighter outlet to obtain a reliable power source, and also by connecting to either a temporary magnet-mount antenna on the car roof or to a permanently installed antenna. The unit is not bolted to the vehicle but is commonly placed on the seat. Performance of these transportable units can rival a mobile unit, especially since the critical power source and antenna system components are virtually identical. By disconnecting the power and the antenna, the unit can be carried from the vehicle to be used in another car or to be used as a self-contained system through use of an integral rechargeable battery and a small antenna. The units ordinarily weigh about five pounds, but the battery capabilities and battery weight increase in a directly proportional manner. In this portable configuration outside a car, the system becomes subject to limitations of the battery.

All phones—mobile, portable, and handheld—draw increased levels of power while in use, and lower levels when in standby mode (on-hook). The battery must be either replaced or recharged after a few hours of continuous talk time, or following a somewhat greater number of hours of combined talk and standby time. Although portables are available that offer full 3-W transmit power, use of reduced power levels of less than 3-Wcan enable some of these phones to operate over an extended period of time, given the same battery capability. The antenna, which now has no metal vehicle underneath to act as a performance-enhancing ground plane, performs adequately but certainly not with the range of a car-mounted antenna. These units are especially suited to field use where, even though the phone might remain in a fixed location, no conventional telephone service exists. In such applications, auxiliary power might be available to augment the battery in a configuration similar to that of a mobile installation.

Handheld units

Handheld units range from those that weigh approximately a pound to tiny pocket phones that can weigh less than 4 ounces. These most closely resemble handheld two-way radios with extendible or flexible rubber antennas and small batteries contained within the handset. The smallest of these, the microminiature pocket phones, represent the ultimate in portability, but at the expense of battery life and transmit power levels. Talk time from a single battery can be as little as an hour or two, with standby time of 8 to 36 hours. Some units can operate with disposable alkaline batteries as well as, or instead of, the rechargeable nickel-cadmium or nickel-metal hydride battery packs in order to improve the phone's weight-to-performance ratio and to free the user from the constraint of maintaining a supply of recharged battery packs. Handheld units generally operate at transmit power levels of approximately a half-watt. This certainly limits their range and capabilities as compared to a three-watt mobile or transportable unit, but they do perform well as long as they are used in reasonable proximity to the main coverage areas of most cellular networks.

Wearable units

The ultimate communications device for mobile professionals is the cellular phone that can be worn as an accessory on clothing. Motorola's StarTAC phone, for example, may be worn easily and unobtrusively by both men and women on the go. Such units weigh in at 3.1 ounces. When opened to its full size, the StarTAC phone forms to the face to maintain the familiar ear-to-mouth ratio. When folded, the StarTAC phone can be worn fashionably as an accessory.

Despite their light weight and compact design, such phones are capable of advanced features. Motorola's StarTAC 8600 Series of VoiceNote Cellular Phones, for example, feature an answering machine/voice recorder with up to 4 minutes of record time. Other phone features available with the StarTAC phone are: a "Smart" Button, which allows for simplified one-handed use of the phone; silent vibration alert for incoming calls; and a headset jack for hands free conversations. A 1.9-MHz GSM (Global Systems for Mobile communication) version of the phone—the StarTAC Select Series—weighs slightly more at 3.5 ounces, but incorporates a full-size SIM (Subscriber Identity Module) card.

Many value-added services will be aided by a unique feature of GSM's SIM card. This removable "smart card" uses a microchip to store the owner's billing data, special features, speed dial numbers, and other vital information, and can be used in any compatible handset. The SIM card allows for over-the-air activation, contributes to secure network access, and facilitates roaming among international locations.

System Components | Voice Communications

Whether conventional cellular or PCS, the mobile units come in a variety of form factors: those that are permanently mounted in a vehicle, transportable units that can be easily moved from one vehicle to another, or pocket phones weighing in at less than four ounces. Regardless of form factor, mobile phones consist of the same basic elements:

  • A handset with keypad
  • A logic/control unit
  • A transmitter/receiver
  • An antenna
  • A power source


The handset and keypad provide the interface between the user and the system. This is the only component of the system with which, under normal operation, the user needs to be concerned. Any basic or enhanced system features are accessible via the keypad, and once a connection is established, this component provides similar handset functionality to that of any telephone. Until a connection is established, however, the operation of the handset differs greatly from that of a conventional telephone.

Rather than initiating a call by first obtaining a dial tone from the network switching system, the user enters the dialed number into the unit and presses the SEND function. This conserves the resources of the cellular system since only a limited number of talk paths are available. Once the network has processed the call request, the user will hear conventional call progress signals such as a busy signal or ringing. From this point forward throughout the conversation, the handset operates in a customary manner. To end a call, an END function key exists on the keypad. In addition to these functions, the handset typically contains a display that shows dialed digits as well as other features, a CLEAR key that enables the user to correct misdialed digits, functions that enable storage of numbers for future use, and other enhanced features that can vary greatly from one phone to the next.


The logic/control functions of the phone include the numeric assignment module, or NAM, for programmable assignment of the unit's telephone number by the user's carrier of choice, and the electronic serial number of the unit, which is a fixed number unique to each telephone. When signing up for service, the selected carrier makes a record of both numbers. When the unit is in service, the cellular network interrogates the phone for both of these numbers in order to validate that the calling/called cellular telephone is that of an authentic subscriber. This component of the phone also serves to interact with the cellular network protocols that determine what control channel the unit should monitor for paging signals to indicate the network's desire to connect a call coming into the phone, to determine and select the voice channels that the unit should utilize for a specific connection, and to monitor the received control signals of cell sites when the phone is in either standby or an in-use mode so that the phone and network can coordinate transitions to adjacent cells as conditions warrant.


The transmitter/receiver unit of the telephone is the heart of the radio communications component of the system, under the command of the logic/control unit. Powerful three-watt telephones are typically of the vehicle-mounted or transportable type, and their transmitters are understandably larger and heavier than those contained within lighter-weight handheld cellular units. These more powerful transmitters require significantly more input wattage than handheld units that only transmit at power levels of a fraction of a watt, and they utilize the main battery within a vehicle or a relatively heavy rechargeable battery to do so. A diplexer unit within the phone enables the transmitter and receiver to utilize a single antenna while simultaneously transmitting and receiving.


The antenna system, comprising the antenna and connecting cable, determines whether the full power produced by the transmitter is effectively coupled to free space and also whether the minute electromagnetic impulses received from the airwaves can be delivered intact to the receiver circuitry of the telephone. The antenna for a cellular telephone can consist of a flexible rubber antenna mounted on a handheld phone, an extendible antenna on a pocket phone, or the familiar curly stub seen attached to the rear window of many automobiles. The antenna and connecting cable are selected specifically for functionality in the 800-MHz frequency band. Antennas and the cables used to connect them to radio transmitters must have electrical performance characteristics that are matched to the transmitting circuitry, frequency, and power levels. Use of antennas and cables that are not optimized for use by these phones can result in poor performance. Improper cable, damaged cable, or faulty connections can render the telephone completely inoperative.

Power source

Cellular phones are typically powered by a rechargeable battery. Nickel cadmium (NiCd) batteries are the oldest and cheapest power source available for cellular phones. Newer nickel-metal hydride (NiMH) batteries provide extended talk time as compared to lower cost NiCd units. They provide the same voltage as NiCd batteries, but offer at least 30 percent more talk time than NiCd batteries. Unfortunately, NiMH batteries take approximately 20 percent longer to charge than NiCd units.

Newer cellular phones may operate with optional high-energy AA alkaline batteries which provide up to 3 hours of talk time or 30 hours of standby time. These batteries take advantage of the new lithium/iron disulfide technology, which results in 34 percent lighter weight than standard AA 1.5-V batteries (15 vs. 23 grams/battery) and 10-year storage life—double that of standard AA alkaline batteries.

Vehicle mounted and handheld portable cell phones can be optionally powered via the vehicle's 12-V DC battery by using an adapter plugged into the dashboard's cigarette lighter. This saves useful battery life by drawing power from the vehicle's battery and comes in handy when the phone's battery has run down. The adapter will not recharge the phone's battery, however. Recharging the battery can only be done with a special charger. Lead acid batteries are used to power transportable cellular phones when the user wishes to operate the unit away from the vehicle. The phone and battery are usually carried in a vinyl pouch.

The latest type of battery uses lithium ion (Li-Ion) to offer longer life and lighter weight than similar sized NiCd and NiMH batteries. Among the many advantages of Li-Ion batteries is that one cell is roughly equivalent to three NiCd or NiMH battery cells in terms of voltage. Li-Ion batteries also provide approximately twice the energy density of NiCd and NiMH batteries by weight. This means that a Li-Ion battery providing similar energy to a conventional NiCd or NiMH battery will weigh one-half as much.

Cellular Networks

The mobile telephone service that preceded cellular service was known as Improved Mobile Telephone Service (IMTS), which operated in several frequency ranges: 35 to 44 MHz, 152 to 158 MHz, and 454 to 512 MHz. But IMTS suffered from call setup delay, poor transmission, limited frequency reuse, and lack of service areas. IMTS was supplanted by Advanced Mobile Phone Service (AMPS) that operates in the 800- to 900-MHz range. AMPS overcame the limitations of IMTS and set the stage for the explosive growth of cellular service which continues today.

Proposed by AT&T in 1971, AMPS is still the standard for analog cellular networks. It was trialed in 1978, and in the early 1980s cellular systems based on the standard were being installed throughout North America. Although AMPS was not the first system for wireless telephony, the existence of a single standard enabled the United States to dominate analog cellular. Europe suffered from a multiplicity of competing standards such as Nordic Mobile Telephone (NMT) at 450 MHz, NMT and Total Access Communications System (TACS) at 900 MHz, and an assortment of other standards in individual countries.

Analog cellular systems have been a huge success. In just 15 years they have attracted around 50 million subscribers in 60 countries worldwide. Today over two-thirds of these subscribers are on the North American AMPS standard at 800 MHz. Although the AMPS standard was originally defined for networks in North America, it is now widely implemented throughout Europe, Latin America, Australia, and New Zealand, as well as many Asian countries, including China, Hong Kong, Malaysia, and Taiwan.

Over the years, AMPS has amply proven itself in terms of being easy to implement and expand to keep pace with increasing demand for mobile phones. It supports automatic roaming so that mobile phone users can continue to use their phones as they move into an area served by a different network. Analog cellular is delivered over networks which employ large cellular hubs and base stations. Despite its success, this method of transmission has its limitations. Analog signals can be intercepted easily and suffer signal degradation from numerous sources, such as terrain, weather, and traffic volume.

A digital version of AMPS—referred to as D-AMPS—solves many of these problems, while providing increased capacity and a greater range of services. Both AMPS and D-AMPS operate in the 800-MHz band and can coexist with each other. D-AMPS can be implemented with time division multiple access (TDMA) as the underlying technology. TDMA provides 10 to 15 times more channel capacity than AMPS networks and allows the introduction of new feature-rich services such as data communications, voice mail, call waiting, call diversion, voice encryption, and calling line identification. A digital control channel supports such advanced features as a sleep mode, which increases battery life on newer cellular phones by as much as ten times over the current battery capabilities of analog phones. D-AMPS can also be implemented with code division multiple access (CDMA) technology to increase channel capacity by as much as 20 times and provide a comparable range of services and features. Unlike TDMA, which can be overlayed onto existing AMPS networks, CDMA requires an entirely new network infrastructure.

D-AMPS also allows operators to build overlay networks using small micro- and picocells, boosting network capacity still further in high-traffic areas and providing residential and business in-building coverage. Advanced software in the networks' exchanges continuously monitors call quality and makes adjustments, such as handing calls over to different cells or radio channels, when necessary. The network management system provides an early warning to the network operator if the quality of service is deteriorating so that steps can be taken to head off serious problems. Graphical displays of network configuration and performance statistics help ensure maximum service quality for subscribers.

Cellular systems, through their interconnection with the public switched telephone network, allow users to originate or receive communications with more portability, and nearly the same degree of functionality as wired telephones. This is accomplished through a hybrid system that utilizes radio technology for the link between the mobile user and the mobile telephone switching office (MTSO), traditional telephone switching technology for the interconnection between the MTSO and those using the wireline public switched telephone network (PSTN) with whom the user communicates, and computer technology to continually monitor the location of mobile users.

In the early 1980s, cellular network service providers became licensed by the Federal Communications Commission (FCC) to operate based on limited competition in each service area. One provider is usually the local telephone company (also known as the "wireline" provider because of its traditional operation of the wired telephone network), and the other licensee is a competitor to the local telephone company, also known as the "nonwireline" carrier. Because of this limited competition, carriers could feel confident that their investment in developing a network would be rewarded with a significant enough portion of the subscriber base to support continued operations. Without this arrangement, it would have been unlikely that the current network would have evolved in such a rapid manner.

Each carrier, wireline and nonwireline, has been assigned separate radio frequencies under which their license permit them to operate. This allows the competitors to coexist within the same physical operating area without interfering with each other's systems. Cellular telephones are manufactured with the inherent capability to operate on either carrier's network, since they have the capability to transmit and receive on either group of frequencies or channels.

The primary wireless communications link established with the cellular telephone is to the nearest cell site. The cellular carrier's network consists of a number of cell sites, each typically covering a radius of approximately one to ten miles, which are in turn connected to an MTSO either via cable or microwave radio links (Figure 1). The system is engineered so that the cell sites are located in close enough proximity to one another to provide seamless networking capability.

Figure 1: A typical cellular system.

The coverage areas for adjacent cells actually overlap in order to allow continuous coverage for a user in motion across the network as well as to allow for some load balancing of network traffic. Three hundred and twelve radio channels are available for use by each carrier for voice communications between telephones and the cell site, and the channels used by one cell can be reused by other nonadjacent cells since the transmitted power levels are relatively low.

The radio frequencies used for cellular communication between the mobile user and the cell site are in the range of 825 to 890 megahertz (MHz). Separate channels are utilized for transmitting and receiving voice communications, and the telephone equipment allows transmit and receive channels to be utilized simultaneously so that the parties communicating with each other experience a full-duplex conversation not unlike that of a conventional wireline telephone.

Additional radio communications between the telephone and the cell site takes place over control channels that exchange data between the telephone and the cellular network as to the active phones operating within a particular service area. These control channels also provide functions critical to the establishment of calls and the management of the voice communications channels. From the moment the telephone is turned on, even when idle, communication periodically takes place between the telephone and the nearest cell site. The phone and the cellular network repeatedly exchange information via control channel protocols as to the location and status of the phone and the relative strength of the radio signal between them. This allows the network to find the optimal cell site through which it should route incoming calls to the cellular telephone, to determine when the network should "hand off" an established connection from one cell site to another in order to maintain a strong radio connection, and to allow the phone and the network to synchronize their dynamic use of the many available communications frequencies.

A mobile unit operating outside its local service area is considered to be "roaming." The user's account is established with a local provider, but other providers will allow visitors to their network to use the service. Billing is through the home service provider. A service provider's coverage area might be statewide or might represent a particular area code. Billing to the user represents all on-air use or airtime, whether for outgoing or incoming calls, plus any long-distance charges. Most carriers offer an arrangement such that basic airtime charges, on a per-minute basis, are the only usage cost for an extended calling area. Calls to locations that might incur toll charges within the carrier's service area if made by conventional phone might not incur those charges for a cellular call, but they would be billed based on a flat airtime basis, usually in the area of $0.20 to $0.45 per minute. Calls made while roaming outside this area would come at a higher per-minute rate and/or with additional per-call surcharges. At this writing, only Nextel provides business customers with wireless communication nationwide in the United States without roaming charges.

Since a cellular telephone is so dependent upon a radio link to establish and maintain communications, most of the factors that affect their operation are related to aspects of radio technology. Some of these factors are outside the control of the end user and are specific to the engineering of the carrier's network. The location of cell sites, proximity of adjacent cells, transmitter power, receiver sensitivity, and antenna location can all have a significant impact on the quality of communications. In many locations, service quality between providers is virtually indistinguishable. It is quite likely that each service provider will have areas in which strengths and weaknesses exist, especially pertaining to signal coverage in any specific location.

Service providers are not always able to place their cell sites and antennas in the locations that their engineers might find to be ideal, but they do continually test and tune their network to attempt to provide the best level of service possible. An additional factor somewhat beyond the user's control is that of network traffic loading. Service can suffer even on the best of networks merely due to the congestion that results when too many users attempt to access the network at once. Newer cellular network technologies enable a greater number of channels to be derived from existing frequencies (i.e., frequency reuse) and permit the creation of smaller cell coverage areas or microcells to increase overall network capacity.

The Cable Multiple System Operators (MSOs)

As we often hear, “There’s the good news, and then there’s the bad news” In cable, the good news is that cable MSOs are taking two-thirds of all broadband data (ISP) customers and own two-thirds of the broadband consumer market. In fact, three out of five of the largest broadband providers are cable companies.

Furthermore, they are going after voice customers with VoIP, offering the service at an incremental fee plus video, a strategy that erodes the ILECs’ base. In fact, because they are also content providers with plenty of mindshare, cable MSOs are a more serious competitive threat to ILEC local service dominance than the CLECs are. The CLECs, after all, do not, for the most part, go after residence customers; they are too difficult to provision en masse. Instead they go after the aggregated enterprise customers that reside in MTUs because provisioning them is a simpler and less costly process. In fact, many analysts predict that if cable MSOs can crack the code on delivery of voice and can centralize their management and repair functions, they could become the first choice for the delivery of integrated services. And today they seem to be doing this—and are just beginning to announce wireless as a secondary service option. In late December 2004, Sprint and Time Warner announced their intent to work together to give Sprint the ability to sell the “quadruple play” of voice, video, data, and wireless. This places them squarely in the game, offering a converged set of bundled services to customers for as single, low price.

The U.S. cable industry is taking its voice penetration strategy seriously. The industry as a whole has invested over $70 billion in network upgrades to accommodate the demand for high-speed data, and although cable companies have attracted significant numbers of voice customers away from ILECs, the ILECs have done very little in the way of competitive pricing or service expansion to combat cable—though SaskTel’s MAX service is intriguing. The newly released DOCSIS 2.0 for high-speed data promises transmission at very high bandwidth—as high as 30 Mbps. Furthermore, the operating margins on cable modems are quite high—35 to 40 percent.

So what’s the bad news? The bad news is that there is more to running a successful company than having impressive technology. The cable industry’s debt load is enormous because they have all invested heavily to ensure market penetration and their ability to deliver the services demanded by customers. Adelphia, for example, the sixth largest cable company in the United States, has nearly $14 billion in current debt and approximately 5 million subscribers—which works out to a debt load of $2,800 per subscriber. And while this number seems large, it also seems (perhaps) manageable—until we begin to factor in other numbers. Subscribers spend approximately $800 per year on services. However, cable companies spend an average of $480 per year to provide routine service to each subscriber, which leaves $320 per subscriber. Furthermore, capital spent on routine maintenance averages roughly $100 per subscriber, leaving far less in the way of income against incurred debt. And to add insult to injury, this figure does not take into account in any way the capital required to perform ongoing (and required) network upgrades.

Cable analysts use a number of measures for assessing the financial health of cable companies, including operating income (EBITDA) as opposed to free cash flow; they also use return on capital as a good indicator. Today the number averages about 5 percent on a pretax basis, which is not a particularly impressive number.

The top five cable MSOs serve 81 percent of the overall U.S. market, while the top ten serve 95 percent. There is still significant competition for cable from satellite providers: Consider DirecTV and the many services it offers. Their primary market is distributed, commercial video service with 80 percent market penetration and very slow growth (roughly 1 to 2 percent per year). They primarily serve residential markets and are motivated to (1) enter the enterprise space and (2) diversify their line of product offerings. (Readers may have seen the frontal assault on cable posed by the satellite providers in the voracious pig commercials that were recently aired.)

Cable MSOs are not taking the attack idly, however. As the satellite industry pushes hard for customers, cable providers are striking back, keeping rates steady in markets that are most prone to attack by satellite providers and raising prices in markets where it is warranted. They are also relying on broadband Internet access and its high profit margins to bolster revenues and to provide a loudly proclaimed competitive advantage, since satellite providers cannot yet offer Internet access that provides equally satisfactory service. Others are aggressively advertising bundled service packages that offer distributive cable services, broadband Internet access, and telephony for a small additional fee.

Even though satellite prices are typically cheaper than cable for entertainment packages, the magnitude of the price difference is shrinking in many markets. As pay-per-view sporting events and other premium lineup components become more and more expensive, satellite providers are being forced to make the same price hikes that the cable providers have been forced to make to cover costs. And while there is a place for satellite in the provider lineup, its advantage as a big-footprint provider is rapidly being winnowed away as cable and telephony service provider penetration increase and provide fixed access to the same set of services.

The Interexchange Carriers (IXCs)

There are four main long-distance players in the United States: AT&T, MCI, Verizon, and Sprint. These carriers face a number of seemingly insurmountable problems including rapidly increasing customer counts, growing minutes of use (MoU) per subscriber, and a rapidly declining dollars-per-transported-bit-per-mile figure, the combination of which is deadly. Needless to say, this explains their compelling argument for accelerated local service and broadband entry.

One bone of contention for the IXCs is that more than 40 percent of all IXC revenues are paid to ILECs as access charges. Access charges are the fees paid to ILECs by long-distance carriers for the right to use local exchange facilities for the origination or termination of traffic transported to or from one exchange to another by an interexchange carrier. And while some access charges are billed directly to the end user, most of them are paid by interexchange carriers—not an insignificant amount of money. IXCs hope that future regulatory decisions will address the magnitude of this fee. In fact, one reason that VoIP has become so popular among those deploying the service is that it is currently classified by the FCC as an information service rather than as a telecom service, which means that VoIP carriers are exempt from many of the regulatory tethers that bind traditional service providers.


As we noted earlier, the CLECs came into existence in concert with the release of the Telecommunications Act of 1996, with plans to create a fully competitive market at the local loop level. Until that time, only the long-distance sector was fully competitive, with customers able to choose from among three major providers. The local loop was dominated by the ILECs. Since that time, the CLECs have carved out a reasonable piece of the market for themselves, supported by a certain degree of customer dissatisfaction with the ILECs, the promise of lower prices, and a number of favorable regulatory decisions including the Unbundled Network Element-Platform (UNE-P), which offered a generic switching and access platform to all entrants.

CLEC Challenges

Of course, the creation of a local competitive market has been fraught with difficulty. Many of the CLECs filed for bankruptcy because of inability to attract an adequate customer base, and while some analysts believe that CLECs may own as much as 65 percent of the medium enterprise market, their overall showing is still relatively small. In fact, while it is easy to conclude that CLECs are largely small startups that are giving fits to the ILECs, this is not true: Ironically, the largest CLECs in the United States have traditionally been AT&T and MCI, although recent regulatory decisions may force them to drastically reduce their footprint in the local marketplace.

For the most part, CLECs target the small-to-medium business market, which is largely underserved by the ILECs, whose primary focus is on the large business and residence sectors. Most CLECs resell services at a price that is 15 to 20 percent lower than the ILEC price and can thus attract a share of the market that is price sensitive. In fact, the numbers are significant: ILECs lease 20 million lines to resellers at an average of 40 percent of retail, although these numbers could change with the recent regulatory changes announced in recent months by the FCC—and which continue to be announced. The ongoing regulatory circus, combined with the burgeoning deployment of IP-based voice by various market sectors, will continue to make this game an exciting one for the CLECs. Stay tuned!


The ILECs have had a tumultuous ride since their inception in 1984, following the divestiture of AT&T. At that time, AT&T, through its negotiated settlement with the Justice Department, fought to retain control of its Western Electric manufacturing arm and spin off the local service providers because it was clear at the time that the real money was in hardware and that the local telephone companies would not be long for the world. In retrospect, perhaps they should have kept the local telephone companies (the Regional Bell Operating Companies, or RBOCs) and divested themselves of Western Electric. Amazing thing, 20-20 hindsight.
Today, of course, we know that the ILECs are in positions of significant market power. The four that remain—Verizon, SBC, Bellsouth, and Qwest—control 90 percent of the roughly 200 million access lines in the United States today. The remainder of these lines are served by CLECs—small independent telephone companies, cable providers, and wireless providers. Much to the chagrin of the ILECs, that 90 percent market share that they enjoy is declining at the rate of about 2.1 percent per year, and has been for the last couple of years, while “lineshare” for the other sectors has increased incrementally—but increased. It is critical that the incumbent telephone companies stop focusing on numbers of access lines and preservation of minutes of use, and start focusing on preservation of customers. That is the only winning measure.

Timeline Highlights
1963:81 million subscriber lines in United States; 159 million worldwide.
1966: First optical cable used for voice transmission.
1976: First digital switch installed by AT&T.
1984: AT&T is divested; at time of divestiture it has more than one million employees and is worth $155 billion.
1988: First transatlantic optical cable is completed.
1989:138 million subscriber lines in United States; 496 million worldwide.
1991: Bell Labs develops photonic (optical) switching capability.
2000: International voice traffic quadruples in 10 years to 132.7 billion minutes—but revenue only doubles to $70 billion.
2002: U.S. residential cable modem subscribers: 7.7 million; DSL: 4.4 million; data traffic passes voice at 200,000 TB/day; also in 2002, IP surpasses all other traffic in volume.

Contrary to popular belief, the most significant challenge faced by the ILECs is cable, not the threat posed by the CLECs. Cable companies are beginning to take on a more strategic role in the industry at large. After years of competing with satellite providers for “eyeshare,” cable providers are finally beginning to enjoy price stability for the services they provide over their almost completely digital broadband networks. Furthermore, they are beginning to offer a variety of value-added services in addition to their traditional distributive entertainment content, such as high-speed cable modem Internet access and Internet-based telephony—both of which have become significant revenue producers as well as disruptive forces among their new competitors, the ILECs. Furthermore, the recently upgraded cable modem standards (DOCSIS 2.0) add significantly to the capabilities of broadband cable. These companies are now offering what has come to be known as the quadruple play—voice, video, data, and wireless—all packaged as a single, converged, and very lucrative bundle.

The fact is that the ILECs are under siege on multiple fronts. One of the critical questions that now comes up routinely in strategy discussions is this: Should the big three (Verizon, SBC, and Bellsouth) stop spending so much on capital outlay to build out their own networks and instead start spending their cash on the acquisition of preexisting assets? Companies like WorldCom, Cingular, Nextel, and Sprint PCS are, by many measures, undervalued at the moment; and because the ILECs have a recurring revenue stream, they have relatively easy access to capital compared to some of their competitors. One of the biggest challenges they face is that they have very high fixed costs and very low variable costs—which makes it difficult for them to make major adjustments in their cost base without drastic changes (like huge headcount reductions). The danger is that as they begin to lose access lines to competitors—such as cable MSOs, wireless providers, and CLECs—at what point do they lose critical mass and begin to collapse under the weight of their own infrastructure? Furthermore, as ARPU levels decline without a closely tied reduction in costs, the hole gets deeper.
Consider that between 1998 and 2002 alone Bellsouth, Verizon, and SBC spent $140 billion in CAPEX on their networks, a move that yielded less than one percent revenue growth. In 2003 they made combined profits of $20 billion on a collective market value of $240 billion. Clearly they want these numbers to increase. In 1998, ILEC CAPEX was 30 to 33 percent of revenues; today it is far lower, about 14 percent.

What steps have they taken to remedy the ongoing revenue shortfall? The first steps they took involved a direct attack on the FCC with a petition to reenter the long-distance market, referred to by regulators as Section 271 relief. Section 271 of the 1996 Telecommunications Act allows the remaining ILECs (Qwest, Verizon, SBC, and BellSouth) to enter the long-distance market if they can prove that they have sufficiently opened up their local markets to competition. As you know from your readings, they have aggressively pursued this course of action; so, suffice it to say that the ILECs universally fought for long-distance relief in response to local telephony entry by their competitors and have in fact been granted large entry concessions. Verizon, for example, replaced Sprint as the third largest long-distance provider in terms of customer count. The originally stated reason for long-distance entry was incremental revenue, since the cost to an ILEC for in-region entry was near zero. However, while the ILECs doubled the number of long-distance customers they serve, the revenues from the long-distance lines of business they established declined 6 percent as the bandwidth glut and the magic of declining ARPUs took effect. Clearly, ILEC entry into long dis- tance has bought them precious little if any margin relief as they watch their local services revenues decline.

So what must they do? There are a number of steps that service providers can take to shore up their falling revenue targets. They include acceleration of the circuit-to-packet migration, which facilitates convergence; marshalling a renewed focus on the importance of the metro marketplace; aggressive revamping of their overall network infrastructures; a much stronger focus on both element and network management; an aggressive examination of the services that customers actually want and a plan to deliver them cost effectively; and a strong focus on both enterprise and residence customer requirements.


The circuit-to-packet migration plan stems from the convergence activity that is underway throughout the greater industry. There is no question that circuit-based services such as voice, ATM, and frame relay will be around for some time to come, but there is aggressive movement going on with regard to packet migration. Companies are rapidly developing and rolling out service packages that rely on IP, softswitch technology, and packet-based services, including voice. The VoIP marketplace for wireless, Centrex, and PBX service alone is enormous. Now that the industry is back on its feet and money is moving in, this trend will accelerate. VoIP is a critical success component and not simply because it helps the telco reduce costs. It is critical because it facilitates the delivery of a new suite of converged applications and services that represent new revenue streams for the telco. There is nothing more important than that.

Metro Markets

Because of the diverse, multiprotocol nature of the metro marketplace and the ongoing evolution of the corporation—from operating out of a single metro-based location to a distributed corporate architecture with offices scattered throughout customer locations—metro has become one of the fastest growing market sectors for service providers. And because optical technology has taken root in the metro rather effectively, with low-cost, multichannel DWDM technology offering lower cost solutions due to optical’s ability to reduce the total number of network elements under management control, it garners attention. Today, ILECs control more than 60 percent of all metro spending; this is a significant percentage of the overall market and deserves the attention it attracts. Furthermore, the fundamental local-loop technology for the metro is Gigabit Ethernet, and to be even more granular, switched Gigabit Ethernet. Service providers can simply drop a fiber connection in the basement of a metro office building, terminate it on a high-volume Ethernet switch, and deliver a broad range of high-bandwidth services to multiple customers in the building.

Network Revamp

Today the typical ILEC operates a wide array of disparate and functionally unrelated networks: the PSTN, the IP network, the ATM network, the frame-relay network, the ISDN overlay, the DSL overlay, the wireless network, the high-speed Ethernet access and transport network, and so on. Recent technological advances such as Multiprotocol Label Switching (MPLS) and Resilient Packet Ring (RPR) allow for many of these network infrastructures to be converged onto a reduced set of protocols and physical networks, a move that dramatically simplifies the complex management task that ILECs face. This complexity translates into revenue barriers because of service delays, QoS issues, and billing discrepancies. Anything that can be done to simplify “the cloud” is a step in the proper direction because it reduces overall operating cost and stands a good chance of increasing customer service levels because of reduced network complexity.
The move to an IP infrastructure is clearly underway, but in many cases the telcos are reluctant to make big moves in that direction because of uncertainty over the business reasons for such a radical migration. In fact, there are relatively few valid business reasons for the migration to IP. The first is obsolescence: If a telco is facing a situation in which a switch in a central office is nearing obsolescence, then an IP overlay is probably worth considering. Or, if the telco is about to offer service in a greenfield (new, devoid of services) market, then IP is worth considering. Alternatively, if the service provider is facing a situation in which a switch is nearing capacity and will potentially require real estate expansion to accommodate the new equipment required, then IP is worth considering because of its reduced floor space requirements. Finally, if the service provider is operating in a region with a high degree of business penetration, or is in an area where fiber-to-the-home (FTTH) is being considered, then IP represents a serious advantage and should be considered as a key infrastructure component.


Network and element management, like staff training, are often the first things cut from the budget and the last things implemented. Perhaps that’s a bit harsh, but not by much. One of the loudest complaints voiced by customers, especially enterprise customers, is billing complexity. Customers claim to want a single, simple-to-understand bill[1] for all of their network services. And because of the diverse and logically disconnected nature of the network elements that come into play when provisioning customer services, the actual provisioning process is often slow, inaccurate, and expensive. Reduction of managed elements and the creation of an aggressively accurate and capable management interface must be of paramount importance to incumbent service providers.
Furthermore, there is ample evidence to suggest that the management systems operated by service providers since time began will soon be inadequate to handle the evolving demands of the services marketplace. Those systems are based on a model of predictable, recurring charges as well as a few nonrecurring charges every month. The market model, however, is beginning to embrace a more transaction-oriented billing model, which means that the OSS systems operated by the traditional telco will no longer suffice. It is critical that these companies actively evolve their internal systems to meet the needs of the changing customer base.
Another factor is physical deployment. The operating expenses incurred by ILECs to deploy DSL, for example, are inordinately high because it often requires multiple “truck rolls” (installation technician dispatches) to make it work. Not only is this expensive in terms of real dollars, it’s frustrating for customers.


Next on the wish list is an aggressive examination of the services that customers actually want and a plan to deliver them cost-effectively. Service providers are now putting into place data-mining and knowledge-management applications to help them better understand the evolving needs of their customers and make them more capable of responding to demands for service, perhaps even before the customer realizes the need. Most important is the aforementioned understanding: At the risk of sounding simplistic, it is absolutely critical that service providers offer services the customers actually want rather than the services that they think they want or that are based on the technologies that happen to be available at the time.

Finally, related to the last item, it is important that service providers carefully differentiate between enterprise and residence customer requirements, as much for the commonalities of demand as for the differences.
So what are these additional services? Many believe that the key to enhanced market success lies in a well-planned entry on the part of the ILECs into the video services market, offering content and interactive video-based services. This could also lead to enhanced success for broadband wireless technologies such as the Local Multipoint Distribution Service (LMDS), WiMAX, and the Multipoint, Multichannel Distribution Service (MMDS). Some service providers are already looking at content delivery; consider, for example, Telus in western Canada. Telus was the first service provider in North America to deploy a regionwide IP backbone, one of the first to offer IP-based voice services, and now offers Telus TV, which is the equivalent of cable content delivered over DSL. Industry analysts continue to examine the viability of ILEC/satellite provider alliances, which would give ILECs an enormous footprint for service delivery and potential access to far-ranging content, and the satellite company access to a large collection of potential subscribers. And while this combination may not be ideal, it is worth considering in the future. Consider SBC’s recent interest in DirecTV. Today, 11 service providers control 85 percent of the global telecommunications marketplace, and ILECs are responsible for 85 percent of all equipment spending. So, they are without question a force to be reckoned with.

ILEC Summary

So, what are the primary challenges facing the ILECs? First, they are experiencing declining revenues brought on by wireless substitution, cable incursion and broadband IP voice in both the enterprise and end user sectors. Second, because of OPEX issues, they often lose money on DSL deployment. Third, their debt load is high. Finally, uncertainty associated with regulatory decisions leaves them with a number of unanswered questions. Nevertheless, the market is currently theirs to lose because they do own the bulk of the customers. However, they must refocus their efforts on both cost reduction and customer-specific service delivery if they are to hold on to their advantage, and must also develop the logical infrastructure required to offer, deploy, and bill for converged service packages.
We now move our attention to the much-maligned CLECs.

Call Center Capabilities

Predictive Dialing

Many Call Centers are designed to both take incoming calls and place outgoing calls. The same group of agents may be responsible for both sales and collections. The sales calls are primarily incoming, and the collections calls are placed during lulls in incoming traffic.

Outbound calls may be placed automatically using predictive dialers. Predictive dialers analyze incoming call traffic and agent activity, then automatically place outgoing calls when agents are about to be available. These predictive dialers help management increase agent productivity by decreasing idle time. When you receive a call during dinner and there is a slight delay before a telemarketer comes on the line, a predictive dialer was used to place the call. When the system detects that you have answered, it sends the call to the telemarketer.
Some Call Centers may focus primarily or totally on these outgoing calls, known as telemarketing. In these cases, less sophisticated dialers can be used. Regardless of the Call Center orientation (incoming, outgoing or a combination) management require similar features to assure optimal functionality.

Work Force Management (Scheduling)

Large Call Centers frequently extend their business hours beyond the traditional workday. Staff may rotate through different shifts or part-time employees may be used to provide extended coverage.
At the same time, call volumes tend to be cyclical. Some times of day or days of the week will always be more active than others. Management must provide a way to schedule employee shifts to reflect these changing requirements.
Balancing the number of employees and anticipated call volumes is a time-consuming task. Call Centers frequently purchase automated workforce management software to complement their Automatic Call Distribution systems. Another option for maximizing agent productivity is to mix inbound and outbound calling in one center.

Wall Mount Display

A wall-mounted display of Call Center volume and agent performance can also serve as a motivator for agents. Mounted in positions of high visibility, displays can be used to scroll information about incoming/outgoing call volumes, agents on line, average time to answer, etc. These displays serve as a reinforcer to agents, and provide valuable information for supervisors when they are away from their desks.

Screen Pops

Screen Pops can shave seconds from many if not all calls. Using a computer-to-PBX/ACD interface, Screen Pop brings the caller profile to the agent at the same time a call arrives. This saves the agent from having to ask for the caller's name, account number or other relevant information, keying in a data request and waiting for the screen to appear.
Some systems use ANI (automatic number identification of the calling number) to initiate the database inquiry and screen transfer, while others use an IVR (Interactive Voice Response System) to ask the caller to input identifying information that will in turn be used for database access and a screen transfer.

Fax Server

Routine requests for information can frequently be handled by a fax server. Order confirmation and general information can be provided very quickly with integrated fax response functionality.
These features give the caller an element of control over the way the call is handled. By using automation to eliminate the ambiguity and frustration of long hold times, Call Centers can increase customer satisfaction without increasing staffing levels.

Supervisor Capabilities | Call Center Telephone System

Supervisor Agent Features

Supervisors may have the option of serving as agents. Supervisor stations may be able to support all agent features in addition to supervisory features from one telephone.

Real Time Displays

Supervisors are responsible for ensuring high agent productivity without sacrificing quality service. The supervisor's most important tool for accomplishing this task is the set of real-time screen-based displays of agent and group performance provided. To be most effective, these displays may be color coded and presented in either tabular or graphic formats as a user selected option. Displays may show real-time status as well as historical information.


Any one supervisor may typically be responsible for 10–15 agents, even though the entire group serving a particular function may be much larger. Supervisors may be able to identify agent information for their specific agents without scrolling through the entire group display. Similarly, supervisors may be able to display a subset of agents from several different groups, if necessary (for example, in evaluating trainees throughout the Call Center). This super group/ sub group capability is very important in larger Call Centers.


In addition to real time information used for daily supervisory functions, historical reports are necessary. These identify trends and are vital to planning.

Reports may include information about individual agent and group performance, trunk usage, transaction codes, emergency recording and alerts. In addition to standard reports, systems may permit supervisors or administrators to develop custom reports, unique to their own Call Center requirements. Raw data is stored for some management-defined period of time, and is available for additional reports for a period of at least a week, up to one or more years.


Displays and reports tell only part of the story of agent performance. To really evaluate agent performance and to assess the quality of service provided, supervisors must be able to listen to agents in actual telephone conversation with callers. This has traditionally been accompanied by a supervisor walking to the agent's desk and listening to the call by plugging a second headset into the station set. This approach has become an accepted part of Call Center culture for many organizations. However, the same result can be achieved with silent and split/silent monitor.

Silent monitor allows the supervisor to listen, undetected, to both the agent and the caller. If necessary, the supervisor may join the call as an active participant at any time. Split/silent monitor allows the supervisor to listen, undetected to both the agent and caller, but if necessary, the supervisor may prompt the agent and remain undetected by the caller. This is particularly useful in training situations, or where threatening or harassing calls are anticipated. Typically silent monitor is invoked on demand, or it may be timed, or it may rotate through the group as calls are terminated.

Forced Answer

When supervisors notice that the number of calls in queue is rising, they may wish to artificially improve the average time to answer (decrease caller time waiting in queue) by forcing agents to answer new calls as soon as prior calls are terminated. This is done by forcing a group-wide override of the wrap/work features.


In the past, supervisors watched Call Center traffic, then physically moved agents to the groups that were most active. Today, it is no longer necessary to move the agent to the call. Sophisticated, intelligent systems now bring the calls to the agents. Nevertheless, Call Center supervisors want to retain the option of moving agents between groups should the need arise. Thus, systems offer an agent Move command that allows agents to be moved even while busy on an incoming/ outbound call. At the end of the call, that call's statistics apply to the original group. Then the agent should get his or her next call from the new group.


When supervisors walked around the Call Center to monitor agent activity, they could easily stop and speak to any agent at any time. Now that Call Center systems have eliminated the need to actually go to the agent's work station, supervisors must find a new way to "talk" with their agents: hence, supervisor-to-agent messaging. Supervisors can send text messages to agent telephone displays. These messages may be predefined: "Good job!" or "Waiting time down 15 minutes" or may be created as needed. Alternatively, the supervisor may be authorized to send messages using a wall mounted display unit. Unlike display phone messaging, the wall-mounted display message is visible to everyone in the viewing area.

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