INTRODUCTION TO WIRELESS COMMUNICATIONS Chapter 4

Chapter 4: Market of radio communications

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Title Page
1. The market profile: 3
2. The driving forces that shape the wireless market: 20
3. Future trends in the wireless market: 23

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Key words:
MTSO, Driving Force, Service Provider, CDPD,AMPS, Spectrum crunch.

Abstract:
Wireless communications have become essential to day-to-day lives of the majority of the
world's consumers. It is now the fastest emerging segment of the communication industry.
As such, it has attracted the imagination of public. The convergence of wireless
communications is bringing together areas of growth and innovation, especially
emphasizing multidisciplinary views of communication and networking.

Objectives:
 An overview of the technologies that enable services, and equipment features that
satisfy end-user requirements.
 A general market profile and several major applications for wireless data
communications technology.
 Some examples of significant industries, which can make use of these applications
will be discussed and characterized.
 The future trends in the market will be summarized and the forces that seem to be
shaping it will be identified and discussed.

Index:
1. The market profile.
2. The driving forces that shape the wireless market.
3. Future trends in the wireless market.
4. Questions of Chapter 4.
5. Answers.

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1. The market profile:

The general profile of wireless market is presented by several major applications for
wireless communications technologies and significant industries, which can make use of
these applications.
The capabilities delivered to the end users is highly dependent on types of services
available and the equipment needed to implement these services. The wireless
communications market can be divided into four segments:
 End users.
 Equipment manufacturers.
 Service providers.
 System integrators.

In many cases, a single company may perform the functions of several segments and
each one of these segments has its own unique set of driving forces.

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END USERS:
End users’ needs in general, must be satisfied at an affordable price in order for the
market to be promoted successfully. Therefor the principle requirements, that should be
met to satisfy the end user’s needs, are:
 Coverage.
 Convenience.
 Capacity (number of users).
 Cost.
 Reliability.
 Speed of transmission.
 Security.
 Safety.
The type of user's applications decide the issues related to each of these requirements.
Therefor these applications can be classified into the following broad categories:
Electronic Messaging and Dispatch:
Typical markets for this application are:
 Messaging as in fig 1

Fig 1

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 Paging services as in fig 2

Fig 2

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 Dispatching service personnel such as field service or package delivery services

as in fig 3

Fig 3

Small amounts of information periodically such as service call assignments, rerouting

instructions, etc. In some applications, we may have a wide area, which needs to be
covered, like spanning continents or oceans, and for these cases, satellite networks are
the best solution choice. However, the messaging and Characteristic of these applications
is the need for personnel in the field to receive dispatch applications still account for
almost half of the cellular and the packet radio markets.
 Transaction Processing:

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Fig 4

This market uses applications such as easily locatable point-of sale terminals (POS) as in
fig 4 where this terminal for example accesses a central database in frequent short
messages to complete a transaction such as credit card verification. Security hear is major
consideration. The applications themselves are usually routines and they are at high
degree of automation. Systems such as the Pak net X.25 Radio Data Network in fig 5 are
good example of communication networks supporting this market.

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Fig 5
 Remote Data Access:
The market for the remote data access application is helpful for person who need
access to databases of repair manuals or customer's details, and for accessing his
office computer while on travel as in fig 6, etc.

Fig 6

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This field represents a major growth area for wireless communications; in addition, the
high level, of technology and infrastructure are just now able to support this market. The
utility of these applications is the access provided to the user to very large databases that
are being changed frequently. As an example is the telemedicine when there is highly
trained person able to deal with many event and even the imagery transmitted to him as
in fig 7.

Fig 7

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 Remote Monitoring:
Remote monitoring applications have typically infrequent, low data throughput
requirements but are able to access multiple sites to acquire data for achieving the
process as in fig 8.

Fig 8

Examples of this are pipeline monitoring as in fig 9, gas and electric meter reading in fig
10, etc.

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Fig 9

Fig 10

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The monitoring of sites located in remote access environments is probably best addressed
by satellite technology as in fig 11; however, even within urban environments, there could
be efficiencies obtained by monitoring utility meters at homes via a wireless network. The
principal driving force for this application will be the cost of the equipment compared with
the cost of personnel or the tariff structure of the local public phone carrier.

Fig 11

Equipment manufacturers:
For the wireless system to be useful and operate properly, it is in need of several types of
equipment that should be placed together associated with the required application
software. These items are classified into the following classes:
1. Base Station/MTSO Equipment:
The base station and MTSO (mobile telephone switching office) as in fig12 contain
all the equipment needed to communicate with the end user and to perform the
switching functions needed to route the data to the other wireless users or to the
wireline infrastructure.

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Fig 12

This equipment represents the infrastructure that shown in fig 13 of the investment that a
service provider must make in order to provide wireless communications services.

Fig 13

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As the coverage area is increased or additional subscribers are added, in general, more
equipment must be purchased and the costs recovered through user fees. For a private
radio network, a single user afford the cost for his service. The cost of this equipment is a
significant driving force behind the development of new protocols, which either allow the
use of less expensive equipment and/or allow the same equipment to accommodate more
subscribers. A good example of this is in the United States, where cellular carriers are
considering the use of two digital alternatives to the current AMPS (Advanced Mobile
Phone System) system. These are the TDMA standard and the CDMA standard shown in
fig 14.

Multiple Access Schemes

 FDMA Frequency Division Multiple Access
 Each user on a different frequency
 A channel is a frequency
 TDMA Time Division Multiple Access
 Each user on a different window period in time (“time slot”)
 A channel is a specific time slot on a specific frequency
 CDMA Code Division Multiple Access
 A channel is a unique code pattern
 Each user uses the same frequency all the time, but mixed with different
distinguishing code patterns

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Fig 14

The predictions for TDMA indicate that, for a very modest investment, a single AMPS
channel can accommodate at least three times the number of subscribers and perhaps as
many as 10 times the number. Similarly, by using CDMA system can accommodate with
at least a 10- to 20-fold increase in the number of subscribers that can be supported.
Each system is currently being tested in various areas of the United States, and the
results will certainly influence the purchase of large amounts of equipment. In addition, the
emerging PCS broadband CDMA market will offer further opportunities for equipment
vendors, as an entire infrastructure still has to be built.
2. End User Equipment and Application Software:
The trend in end-user equipment is for:
 Smaller, lighter weight for ease of carrying.
 Better power efficiency for longer battery life.
 Lighter weight batteries, as well as easy push-button operation.
 Higher levels of integration of all end user equipment.

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For example, laptop computers shown in fig 15 will have integrated wireless modems,
which can be used on several systems.

Fig 15

In addition, personal digital assistant as shown in fig 16 will become ubiquitous and will
include all personal communications, both data and voice, integrated in a single
pocketsize unit.

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Fig 16

End users will only use wireless data communication if it is convenient and useful which
means that a significant driving force for the use of wireless data communications is to
have a well-integrated solution for whatever data device is needed for the particular
application.
SERVICE PROVIDERS:
As indicated in Fig 17 below, service providers fall into two main categories:
 Cellular services providers.
 Packet radio network providers.

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Fig 17

The packet radio network providers are the system operators nowadays. At present
cellular providers are also beginning to offer packet services since They own a portion of
the spectrum, and they have optimized their systems and pricing structures to satisfy end
users. Cellular providers, however, based their data services on circuit switch techniques
as this fit in well with their voice service offerings. With the increased interest from end
users for wireless data and the explosive growth of this market, cellular providers are
adapting their systems to provide data communications in a cost-effective manner. CDPD
(Cellular Digital Packet Data) aims to transfer data in a packetized manner over the
existing AMPS circuit-switching infrastructure competing directly with packet radio network
operators. Also data service features will be in the new TDMA and CDMA standards. This
could have the effect of taking customers away from packet radio network providers,
which make this as a key driving force for cellular data communications, as it will
significantly affect the rate structure, which the cellular service providers must establish in
a way that will make it more cost effective for the end user.

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SYSTEM INTEGRATORS:
Enterprise businesses are, being developed to meet the challenges of today's global
business economy by enabling new kinds of productivity, competitive advantage, and
revenue growth. Employee and customer expectations are also rising, demanding real-
time information anytime and anywhere, and collaboration beyond traditional borders.
Therefor system integration will be a necessity for all kinds of the end user while the
market for wireless data services now is very confusing, and the integration of the end
user’s application with the wireless service is not straightforward. This will greatly affect at
the rate that wireless services are adopted by the end users. Service providers and
equipment manufacturers or software developers will provide this integration by using
service encapsulation and adaptation of protocols and hardware integration as shown in
fig 18.

Fig 18

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2. The driving forces that shape the wireless market:

The wireless market has been shaped by a number of independent forces shown in fig 19
and fig 20 that have come together to form the market as known today. These forces will
continue to operate and will affect the market in the future:

Fig 19

Fig 20

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 End-user community:
This represents both business and personal needs. This community has arisen
because of the dependent on personal computers for almost all kinds of business life,
as well as an increase in the use of the PCs at home for everything from maintaining
personal finances to education and entertainment. Data communications between
computers has made many tasks easy and even automatic, tasks which were, only a
few years ago, demanding of a great deal of precision. In addition, the end users are
demanding networked capabilities away from the office as well. The demands for
mobility now require a wireless connection for much of the communications.
 Technologies:
Technologies have driven the computer and communications industries for the past
several decades and will lead to explosive growth in the use of wireless networks
for data communications for the delivery of data and telephone services in
developed countries.
These technologies include:
1. Advances in Very Large Scale Integration (VLSI) and Microprocessors.
2. Digital signal processing.
3. Networking protocols.
4. Software.
5. New developments in cellular radio system engineering.
6. Integration of wireless communications with the Public Switched Telephone
Network (PSTN) and the development of methods for sending data over this
medium are just now starting to evolve.
 Regulations:
With the deregulation of the telephone industry, in particular in the United States,
and because of increasing demand for wireless data services, regulators have had
to develop, which encouraged and even mandated a competitive environment as
new spectrum was allocated for these services.
 new standards:
The new developed standards will further encourage competition for services. In
some areas, such as the United States, the proliferation of standards and proposed
standards has caused some consumer confusion with a resultant damping effect on

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the market. However, in Europe, the Global System for Mobile Communications
(GSM) standard should have the opposite effect and increase the market.

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3. Future trends in the wireless market:

There is great focusing on developments and emerging new technologies and new
standards towards promoting wireless communications. This focusing will on the following:
 Wireless devices.
 Wireless security.
 Wireless data communication.
 Wireless networks.
 Wireless sensors.
 Wireless services and applications.
 Wireless green communications.
We need wireless communications for voice communication, data transition and wireless
Internet. Wireless users use the Internet differently than fixed users, while Wireless
devices have limited displays and input capabilities compared with typical fixed devices
such as the Pc. In addition, the transactions and messaging will be the rule instead of
lengthy browsing sessions. Because wireless devices are location aware, information will
be able to find users, instead of users searching for information. The regulation and
standards environment is a fundamental force that defines many services that can be
made available to the end users. In this promising market, the big usage of wireless data
transmition has caused a “spectrum crunch.” Because of:
 The increasing number of smartphones, tablets, and other mobile devices with
internet access.
 Wireless data traffic has grown tremendously, increasing by more than 100%
between 2009 and 2010 and after.
 It is expected that a growth in data traffic will continue for at least the next few
years. Therefore, it seems that wireless carriers will be unable to accommodate this
big demand without additional spectrum.

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Expanding the capacity of wireless networks, including improvements in spectral efficiency,

increases in network density through cell site construction, and offloading traffic to wireline
networks via Wi-Fi or other antenna systems, will likely be insufficient to allow capacity to
keep up with demand. In short, the projected growth in data traffic can be achieved only
by making more spectrum available for wireless use. In response to this “spectrum
crunch,” an additional 500 MHz of spectrum available for wireless broadband has recently
proposed by many governments.
The wireless market is going to expand as end users see opportunities to make their own
product be more efficient and to expand into new areas with enhanced products that are
more efficient. What opposing this aim is the following forces:
 The high cost of equipment.
 The limited resources of the radio spectrum.
 The cost of providing services.
 The period time at which new application software can be written or existing
application software can be modified to take advantage of wireless communications
media.
For example, as the cost of equipment and service is decreased, the market will expand
as it becomes more cost effective to deliver new and enhanced services. The driving
forces, which will reduce the cost of services, are affected by current efforts to increase
the capacity of the systems through more efficient use of spectrum (i.e., TDMA, CDMA,
and CDPD development efforts). Decreasing the costs associated with the purchase and
operation of the base station and MTSO equipment, as well as the increased amount of
spectrum that is becoming available (i.e., the PCS spectrum auctions now occurring in the
United States). One force, which may be impeding the market expansion in the United
States, is the number of protocols currently under development. This will cause consumer
confusion and will require, at least for the near term, different modems depending on what
service area the user is located in.

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The cost of end-user equipment will continue to be lower as the applications become
better and better defined in addition to existing of multiple applications executed in one
device as in fig 21.

Fig 21

This will occur with higher levels of integration, and the ability to adapt to multiple
protocols. In addition, as the market expands, the cost of equipment will be further
reduced due to increased production volume. Initially, the multiple protocols will be an
obstacle, but eventually modems will be developed that will be able to transparently adapt
to whatever protocol is supported by the service provider in the area.
Applications programs as shown in fig 21 are potentially the biggest driver. These will
ultimately define the degree to which wireless data communications are useful to the end
user. The result of this will be to make it cost effective for other applications to take
advantage of the wireless media, further increasing the market.

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Questions of Chapter 4:

Q1:
Which one is a segment of wireless market profile?
a) Several major applications.
b) Significant industries, which can make use of these applications.
c) Equipment manufacturers.

Q2:
What are the segments that conform the wireless market? (Choose all that apply)
a) End users.
b) Equipment manufacturers.
c) Service providers.
d) System integrators.

Q3:
What are the requirements that should be met to satisfy user's needs? (Choose all that
apply)
a) Coverage.
b) Convenience.
c) Capacity (number of users).
d) Cost.
e) Reliability.
f) Speed of transmission.
g) Security.
h) Safety.

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Q4:
What are the most applications end users interested in? (Choose all that apply)
a) Electronic Messaging and Dispatch.
b) Transaction Processing.
c) Remote Data Access.
d) Remote Monitoring.

Q5:
What are the classes that equipment manufacturers are classified into?
a) Base Station/MTSO Equipment.
b) End User Equipment and Application Software.

Q6:
What are the categories service providers are fell into? (Choose all that apply)
a) Cellular services providers.
b) Packet radio services providers.

Q7:
What are the most driving forces that shape wireless market? (Choose all that apply)
a) Business and personal needs.
b) Technical capabilities.
c) Enabling regulations.
d) Standards.

Q8:
What are the new trends in wireless market today? (Choose all that apply)
a) Wireless devices.
b) Wireless security.
c) Wireless data communication.
d) Wireless networks.
e) Wireless sensors.

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f) Wireless services and applications.

g) Wireless green communications.

Q9:
What are the current demands for wireless? (Choose all that apply)
a) Voice communication.
b) Data transition.
c) Wireless Internet.

Q10:
What is the result of big usage of wireless data transmissions?
a) Spectrum crunch.
b) High data rate.
c) More services.
d) Lower quality of service

Q11:
What are the opposing forces against wireless market growth? (Choose all that apply)
a) The high cost of equipment.
b) The limited resources of the radio spectrum.
c) The cost of providing services.
d) The period time at which new application software can be written or existing
application software can be modified to take advantage of wireless communications
media.

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Q12:
Why has the big usage of wireless data transmition caused a “spectrum crunch”? (Choose
all that apply)
a) Because of the increasing number of smartphones, tablets, and other mobile
devices with internet access.
b) Because wireless data traffic has grown tremendously, increasing by more than
100% between 2009 and 2010 and after.
c) The expected growth in data traffic for at least the next few years.

Question Answer
Q1 c
Q2 a,b,c,d
Q3 a,b,c,d,e,f,g,h
Q4 a,b,c,d
Q5 a,b
Q6 a,b
Q7 a,b,c,d
Q8 a,b,c,d,e,f,g
Q9 a,b,c
Q10 a
Q11 a,b,c,d
Q12 a.b.c

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