ComSpace prepares to make DCMA base stations, chip sets, in hopes of replacing FM two-way radio
“The goal is to give specialized mobile radio (SMR) and private system operators a way to increase system capacity, and to make it simple for two-way radio manufacturers to make handsets and mobile units that work on the expanded systems,” said David L. George, executive vice president of technology and engineering at ComSpace, Irving, TX.
In the context of a company name change (from Unique Technologies International), an $8.5 million cash infusion, a buyout of a joint venture partner, a hiring cycle to prepare for manufacturing operations, and a relocation to larger facilities, George explained how ComSpace expects its technology gradually to replace FM on trunked radio systems.
The technology, dynamic channel multicarrier architecture, or DCMA, is so-named partly to be descriptive and partly to resemble other mobile communications jargon, such as TDMA and CDMA, anticipating the day when it may become as commonly known. DCMA repeaters fit five channels in the same spectrum space as one FM repeater channel. A simple, initial channel expansion for a spectrum-short radio system operator would be to convert one FM channel to DCMA with five channels and to sell new customers DCMA handsets and mobiles.
ComSpace ran out of money in August 1996 after demonstrating a DCMA system prototype and applying for patents. A second round of financing has brought an $8.5-million equity investment led by Dallas-based Sevin Rosen Funds and Centerpoint Ventures.
“We’ll use the money to develop base stations for system operators and chip sets for radio manufacturers,” George said. Radio manufacturers will be able to use the chip sets to build the kind of miniaturized handsets and mobile units that customers familiar with chip-based cellular and SMR products have come to expect.
In the 1970s and 1980s, many second-tier (compared to Motorola) brand-name radio makers thrived by making Motorola lookalike products, using offshore manufacturing to make radios with a design life of 10 years and offering them at competitive prices. By the 1990s, the product life cycle shortened, radio complexity grew and integration (the use of proprietary silicon chips) increased, making it difficult for radio makers to continue emulating Motorola, George said.
Meanwhile, FCC licensing tactics used by wide-area SMR operators (such as McLean, VA-based Nextel Communications and companies with which it eventually merged) eliminated access to expansion frequencies for most other SMR and private system operators. This hampered their growth and slowed the demand for FM handsets and mobiles.
Four years ago, David George and ComSpace president Steven E. Fulford were both executives with Fort Worth-based Uniden America. Uniden gave its blessing for them to found Unique Technologies International_while continuing to work at Uniden as independent contractors_to develop a technology to expand SMR system capacity without additional frequency spectrum.
“We wanted to refarm Uniden’s existing customer base by giving them more capacity,” George said, “allowing us to sell them more radios.” Uniden had many customers with medium- and small-sized trunked radio systems with five channels or so, the hardest systems to expand. Uniden had first right of refusal for equity investment in Unique Technologies when the time came.
About three years ago, the time came. Uniden took a pass on investing, and George and Fulford exited Uniden. Lenbrook Industries, Pickering, Ontario, Canada, invested $1 million in the stand-alone company. As part of the current equity transaction, Lenbrook Industries received some cash and continues to own about a 12% stake in ComSpace. Gordon Simmonds, Lenbrook Industries’ president and ComSpace’s previous board chairman, continues as a director.
“The new partner is exactly the type of equity player that can truly take the DCMA technology and commercialize it effectively,” Simmonds said.
George and Fulford worked with Wireless Systems International, Bristol, England, a spin-off from the University of Bristol, and the university’s Andrew Bateman, Ph.D., to invent DCMA. Unique Technologies and Wireless Systems formed a 50-50 joint venture, named Unique Wireless Developments, to advance DCMA. Unique Technologies provided funding, marketing and administration, and Wireless Systems developed and demonstrated the new technology. With funds from the Sevin Rosen equity investment, Unique Technologies bought Wireless Systems’ 50% share of the joint venture for $385,000.
“Since Unique Technologies is the group most dependent on DCMA’s success, it made good sense to turn over full control of the technology,” said Simon Jones, managing director of Wireless Systems. Wireless Systems, meanwhile, has received a $3.5 million equity investment from the capital group 3i, and it is pursuing the manufacture of high-linearity RF amplifiers for the $950 million (annual) worldwide base station market.
ComSpace will use most of its equity funding to manufacture DCMA base station repeaters built for high reliability.
“As operators add DCMA repeaters and create a demand for handsets and mobiles, we expect more interest among radio manufacturers,” George said. In April 1997, Kenwood Communications, Long Beach, CA, signed a memorandum of understanding with Unique Wireless Developments (now a ComSpace subsidiary) for the production of DCMA subscriber equipment. At the time, Kenwood Communications President Tom Wineland, said the signing confirmed “Kenwood’s vision of the tremendous opportunity for expansion and new services that exist in both the domestic and international SMR/ESMR industry.”
Intek woos dispatch customers with unique modulation technology, focusing on industries and geography
Intek Diversified, Princeton, NJ, seeks radio dispatch customers through its combination of two U.S. and two UK subsidiary companies. In the United States, the best-known of the four is Kansas City, MO-based Midland USA, notable for its dealer sales of FM two-way radios. Torrance, CA-based RoameR One operates 220MHz specialized mobile radio (SMR) networks and sells equipment and airtime for network use. In the United Kingdom, one subsidiary conducts equipment research and development, and another manufactures the RoameR One equipment.
Subsidiaries_Linear Modulation Technology (LMT), Midsomer Norton, England, researches and develops equipment associated with linear modulation (LM). Rick Hillum, LMT director of technology, explained that LM is “a practical implementation of a linear transform from baseband to RF, translated to RF, and converted back to baseband.” Neither analog nor digital, LM is “transparent to anything you put into baseband,” Hillum said, which means an LM system will carry analog, digital or combination signals.
“I like to use the term, ‘beyond digital,'” Hillum said.
Nearby, Securicor Radiocoms manufactures digital trunking voice and data mobile units for use on North American 220MHz radio systems designed to serve the internal communications requirements of industrial and business entities. Its North American systems use advanced digital network trunking (ADNT) protocol, which is based on the MPT1327 protocol initially developed for use in the United Kingdom.
“A lot of detailed technical issues are involved in the difference between ADNT and MPT1327,” said Simon Trist, LMT’s chief engineer, “and ADNT makes additional features possible.”
Midland USA distributes VHF and UHF FM mobile, hand-held, base station and repeater units used with business, industrial and public-safety private radio networks. Midland also tests and tunes the digital trunking equipment and warehouses the stock for U.S. distribution.
RoameR One operates 220MHz networks and generates sales leads for RoameR One and Midland dealers. Many Midland dealers sell both FM and LM units. Offering a package of two-way voice and “simple data,” RoameR One finds customers that are attracted, in part, by a flat monthly airtime rate of $25 per unit or less. “Simple data” includes, for example, bar code reading and automatic vehicle location.
“These are features at a price you can’t get anywhere else,” said Donald R. Goeltz. “The cellular bill would be huge, and a pager can’t do it.” Goeltz is senior vice president for corporate development at Intek and is president of RoameR One and Midland USA.
RoameR One holds licenses for 250 sites covering 120 markets and 175 million pops, including 75 licenses and systems acquired during the past six months.
* Executives_Goeltz joined Intek in July 1997, coming from Ram Mobile Data, Woodbridge, NJ, where he was in charge of corporate development. Goeltz said that Intek’s role is to focus the efforts of the three subsidiaries, to develop a model of how the RoameR One and Midland businesses are to be run and to replicate the model across the country. “The technical expertise is in the research and development lab. Our experience is in how to develop businesses,” he said, referring to his own responsibility and that of Intek Chief Executive Robert J. Shiver, Chief Financial Officer D. Gregg Marston and Vice President of Administration Louis J. Monari. Shiver joined Intek in September 1997.
“[Shiver] was a senior executive in the alarm industry,” Goeltz said. “He is a seasoned manager who knows how to build businesses and how to raise money for high-growth companies.” Lee Montellaro had served as chief financial officer for most of 1997, and was replaced by Marston in January 1998. Marston previously has served in key financial positions with several California-based companies. Monari, a former vice president of Digital Solutions, was named to his current Intek post in January 1998.
* Strategies_RoameR One owns or manages 200 licenses for 220MHz systems in 120 markets. Goeltz said Intek decided to focus initially on four geographic areas and on particular segments of the dispatch industry. Los Angeles; Phoenix and Tucson, AZ; Kansas City, MO-KS; and Minneapolis have been chosen for the geographic focus. Local and regional transportation, construction, and courier businesses have been chosen for the industry focus. Meetings to announce a partnership alliance between RoameR One and Midland USA and to demonstrate products were held in November 1997 in those markets. In January, Buffalo, NY, and Cleveland were in the process of being added to this “Phase One” geographic focus. By the end of March 1998, a “Phase Two” rollout is scheduled to include Denver, New Orleans, Pittsburgh, Boston and as many as eight other markets.
Goeltz sees “a lot of opportunities” in the dispatch communications business. “A consulting report issued by Strategis Group during the past six months points to the fact that dispatch is viable and growing,” he said. “They have tagged the size of the land mobile radio market at 19 million units today and growing to 35 million by 2001. For many dispatch users, there are alternatives, such as cellular and paging. But what they need is two-way voice and simple data.”
Intek has an international business strategy, too. It seeks to license local partners to manufacture and sell the narrowband digital trunking equipment in foreign countries. Goeltz reports progress toward licensing a partner in South Korea to make narrowband digital trunking equipment for deployment there and perhaps in China, and toward licensing a partner in Europe. Intek also seeks manufacturing partners for 220MHz equipment and other equipment to use in VHF and UHF bands as the FCC sets new technical, operating and licensing requirements in its “refarming” regulations.
“The local partners have the best entrees into the local marketplace,” Goeltz explained. “As an outsider, it is hard to come in and build from scratch. The local partners know regulations, marketing, distribution and the right user base to pursue. It would take us many years and much money to learn the same information.”
* Stock_Intek stock trades on the NASDAQ exchange (symbol: IDCC). Securicor Group, Surrey, UK, owns about 60% of the shares. With a merger involving Toronto-based Simmonds Capital Ltd. (SCL), Intek was converted several years ago from a maker of injection-molded plastics manufacturing equipment into a telecommunications company. SCL spokesman Harry Dunstan said SCL now owns about 11% of Intek’s shares, which he said are treated as “a securities investment.” The price of Intek stock has fluctuated from about $3 (at the time of the merger), to $9, to a little more than $1, and to about $2.60 in February 1998.
“The initial stock rise reflected market anticipation of the startup for RoameR One, and the startup was delayed,” Goeltz said. “Building the Roamer business is not ‘instant pudding.’ On the Intek side, we didn’t get complete staff on board until several months ago. Now we have the staff needed to build the business.” Although the stock price is disappointing, “Now we’re on track,” Goeltz said
Eupen Cable opens new distribution center Eupen Cable USA, the U.S. subsidiary of Kabelwerk Eupen AG, Belgium, has constructed a new warehouse facility and distribution center at its St. Petersburg, FL, headquarters. Inventories of the full range (1/4″-1 5/8″) of EC corrugated copper cables, connectors and accessories will be maintained at the warehouse for fast delivery. The distribution center, which opened in mid-December 1997, also offers the U.S. and Latin American wireless industry value-added, technical support and service capabilities, including connector installation and RF testing of cables.
American Tower System adds lightning protection at FL tower American Tower Systems has adopted a new, integrated lightning protection system at its Treasure Coast Tower in Florida. The system was designed and manufactured by Lightning Master, Clearwater, FL, and includes bonding and grounding, surge suppression and Streamer Retarding brand structural protection. The system will protect against structural and equipment damage and operational problems at the co-location facilities, which provide tower space for cellular, broadcast and governmental communications clients.
American Mobile Satellite to acquire Motorola subsidiary American Mobile Satellite, Reston, VA, and Motorola, Schaumburg, IL, have announced a definitive agreement whereby American Mobile will acquire Motorola’s ARDIS data messaging business, which owns and operates a two-way wireless data communications network. The American Mobile network will offer combined satellite and terrestrial data capability for routing of data messaging. The transaction is contingent on government approvals and is expected to be completed during the first quarter of this year.
The ARDIS wireless data network covers more than 425 cities in the United States, Puerto Rico and the U.S. Virgin Islands. Transmissions penetrate buildings, providing wireless data communications not otherwise possible in urban areas.
Bytel intalls trunking system for gasoline company Bytel, Houston, has completed installation of trunking data modems (TDM) in southeast New Mexico and west Texas for Sid Richardson Gasoline. The TDMs are being installed in electronic gas meters that measure volumes of gas flowing from the wellhead and into Richardson’s gas-gathering pipelines, which are located in a 13-county area of the Permian Basin.
Bytel recommended that Richardson should have a private, not public, trunking system, allowing it to have both voice and data communication. Richardson installed a Motorola Privacy Plus trunk system that is presently being used to collect hourly data from 190 electronic gas meters.
“We’ve been able to collect data from the field hourly with the Bytel communications link, where before we had to manually download the data with a laptop computer at the well site. We now have the capability to display the data on a graphical interface, which allows our field technicians, plant operators and management to view the entire system from a single location,” said Bruce Williams, manager of Gas Contracts and Information Services for Richardson.
Bytel’s TDM operates as both the master and remote stations in point-to-point or point-to-multipoint configurations for Richardson. Each unit requires a standard two-way radio operating on Richardson’s trunked network. The TDM interfaces with Bristol Babcock’s Network 3000 products.
Uniden affiliate offers universal product support Product Support Services (PSS), a newly formed affiliate of Uniden Corporation, Tokyo, and an authorized service provider for Uniden products, has emerged as its own company following realignment of Uniden America Corporation, a subsidiary of Uniden Corporation. As an independent service and support organization, PPS provides wireless technology product support.
Uniden America Corporation, known in part for manufacturing two-way radio equipment, used to provide its own warehousing and distribution; accept returned merchandise and refurbish, resell or otherwise dispose of it; repair its branded products; warehouse and distribute parts and accessories; and handle pre- and post-sale customer inquiries.
These functions have been given to PSS. In addition to continuing to carry out these functions for Uniden America, PSS has been given the autonomy to contract with other manufacturers to supply some or all of the same services. Even a competing two-way radio manufacturer could use these services.
“Take a situation where sales are such that back-end support services, repair and refurbishing are overwhelmed,” said Mark Humphries, PSS business development manager. “Another manufacturer will look at other service and support opportunities_at selective co-sourcing_when their customers are not currently getting the necessary quality of service.”
Co-sourcing means that PSS would augment or replace services that other manufacturers often provide for themselves. Because Uniden products range from CB to VHF radio to satellite radio technologies, including high- and low-end consumer products, “PSS already has a good-sized repair organization that supports a multitude of products with industry-leading turn times,” Humphries said. “We’re working with ISO 9002 standards processes and procedures.”
PSS employs more than 300 people in a 345,000-square-foot facility in Fort Worth, TX, that includes a federal trade zone. The company’s Web site address is www.productsupportservices.com.
Because the International Taxicab and Livery Association (ITLA), Kensington, MD, has contracted the Industrial Telecommunications Association, Arlington, VA, to coordinate frequencies for the Taxicab Radio Service, Alfred LaGasse, ITLA’s executive vice president, has joined ITA’s board of directors. He said that a high priority for ITA is to fine-tune its frequency coordination software to meet 8.8 requirements (referring to a new method for calculating radio coverage areas and, thus, reducing the potential for interference). “We also want to make sure other coordinators hold to a tight standard,” LaGasse said. “We are concerned that some coordinators might not meet the new standard, thereby creating interference problems.
March 22 marks the 50th anniversary of the FCC grant of type acceptance for the “first wireless personal communications” device to Al Gross’ Cleveland-based Citizens Radio Corporation. The grant was for a 465MHz transceiver with a self-excited oscillator transmitter and a superregenerative receiver. Gross now is an electromagnetic compatibility engineer with Orbital Sciences, Chandler, AZ
Tim Dunn, deputy manager of safety for the city of Denver, had praise for his department’s Ericsson mobile radio system for its service during a heavy snowstorm Oct. 24-25, 1997, and during the pope’s 1993 visit. “The system worked extremely well,” he said. Regarding another matter, Larry Fenstemaker, the city’s superintendent of radio engineers, said a computer command was used to disable a radio stolen from a fallen police officer, preventing a burglary suspect involved in the incident from monitoring the plans and locations of other officers.
Alan Shark, president of American Mobile Telecommunications Association, Washington, said that, although McLean, VA-based Nextel Communications’ 90% dominance of an FCC auction of the upper 200 800MHz SMR channels was dramatic, “it was not unforeseen.” Shark said he believes that the FCC has pledged to create real opportunities for the rest of the business wireless industry in future auctions.
In Sunnyvale, CA, base station filter manufacturer Conductus wants wireless telephony network operators to take a serious look at filters that use superconductors to improve call-drop rates. “Network operators can avoid the expense of adding sites or repeaters and pay back the cost of filters within two years,” said James J. Daley, a Conductus vice president.