Subject: [NEXTEL-1] CMRS On The Attach- Private Wireless Watchout

From: [email-masked]
Date: Tue, 25 Nov 2003 18:59:24 -0500

Here is another example of how CMRS has hooked on to Private Wireless.
Consumers have been mislead to think Nextel is what PTT really is (NOT).
Examine CMRS PTT numbers v. Private Wireless PTT numbers and you will see why
Private Wireless is losing the race.
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CMRS On The Attach- Private Wireless Watchout
Carriers continue to mimic Private Wireless .................
ABI Talks Up PTT
11.24.03

OYSTER BAY, N.Y. -- Last week Nokia launched the world’s first GSM based
push-to-talk-over-cellular (POC) enabled handset, the 5140. While this may mark
an important step for GSM users to enter the POC arena pioneered in the US by
Nextel, the impact is far greater, advises technology research firm ABI. Nokia
plans to provide POC in all 2.5G and 3G handsets by 2005. This is a bold move,
considering the limited market that exists today.

ABI projects about 540 million wireless handsets to be sold in 2005. A move to
integrate POC as a standard feature would encourage subscriber adoption thereby
boosting average revenue per user (ARPU). Further, as a standard feature in
handsets, POC may finally enter markets beyond the Americas. Nearly twenty
operators across the globe are considering deploying PPOC services at this time.

Operators like Verizon and Sprint PCS have joined the bandwagon, with others to
follow soon. With installation of specific application servers and compatible
handsets, an operator can provide IP-based push-to-talk services. Nextel’s
Direct Connect service is based on Motorola’s iDEN network and compatible
handsets.  With a subscriber base of nearly 12.3 million, Nextel enjoys the
highest ARPU in the industry, at about $71 per month, coupled by a low churn
rate of 1.4% for the most recent quarter. Verizon on its part garnered about
100,000 users in six weeks after launching its own push-to-talk service.

Enterprise users rely on POC for collaboration with employees in the field.
Companies in logistics, construction and sales, with scattered employees, find
the service most useful, and comprise a large portion of Nextel’s subscribers.
Quite simply, these users cannot function without the service, explaining the
carrier’s low churn rate. Youth, on the other hand, uses POC as a means of fast
communication that falls in the lines of their fast-paced lifestyle. A typical
POC cellular lasts for only a minute or so.
Operators spend significant amounts subsidizing feature-rich handsets in order
to lure customers to use data services, raising customer acquisition costs. By
offering POC services -- which require a relatively less expensive handset --
operators gain a highly loyal user base as well as a higher ARPU. So, unlike
other data services like picture messaging, which require more expensive
handsets and offer a lower boost to ARPU, the exact opposite is true for POC
services.

http://www.unstrung.com/document.asp?doc_id=43955

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