Subject: [NEXTEL-1] Commentary 4Mobility - What's Next (Wave)? - 29 January 2003

From: Marcel <[email-masked]>
Date: Wed, 29 Jan 2003 18:03:26 -0500

What's Next (Wave)?

After years of legal wrangling, the Supreme Court has confirmed that NextWave can hang
onto its vast spectrum assets--the largest block of unused spectrum available for the next
generation of mobile communications. Since there wont be any new spectrum until at least
2006 and possibly 2008, there are many options now available to NextWave.

The press and analyst community is having a field day with this story and there are many
opinions as to what will be done with this spectrum. I have been researching NextWave's
options for some time and have come up with the following scenario for the company and, as
it turns out, for the entire wireless community.

What Should NextWave Do with Its Spectrum?

NextWave could sell the spectrum and call it a day, or as it has said all along, it could
build out its network and make it available for others to resell. But there are already
six nationwide wireless voice-and-data networks. Why would NextWave want to try to raise
the capital needed to build out yet another voice network? Perhaps it is time to do
something completely different. What if NextWave decided to build out a nationwide,
high-speed (broadband) data-only network?

What I propose below could propel the U.S. into the forefront of wireless once again. It
could be used by all of the existing wireless operators and could attract funding from
many sources both inside and outside of the wireless industry. There are companies that
want to be able to deliver their content to customers at their homes, in their cars, in
their offices and even into their pockets. There are major Internet providers that want to
extend their access wirelessly (AOL, MSN, Yahoo, Earthlink, etc.), and other wireless
operators that are faced with build or buy decisions that will find that in todays world,
buying makes more sense and gets them to market more quickly.

In my scenario, NextWave would fulfill its dream of a resalable nationwide network by
using its spectrum to build out a CDMA 2000 1xEV-DO system optimized for high-speed IP
data that would set the standard in the U.S. NextWave would lead the effort as the
operator with major partners across many industry segments. All wireless carriers, ISPs,
content providers that have an interest in broadband data services can resell this
untethered last-mile network access.

This makes imminent sense since almost all wireless operators are holding their unused
spectrum in reserve for projected growth in voice services, either because of wireline
replacement pricing that has broadly gone into effect over the last few months or because
of lack of sufficient spectrum in major markets for deploying broadband wireless data
services. Almost all are capital constrained with limited ability to commit to major
capital expenditures or spectrum purchases. These operators can tap into a broadband
wireless data network built out by NextWave at wholesale prices in the same way that they
currently buy a wide range of broadband services and capabilities from Level(3)
Communications and others. Since Qualcomm's MSM 6500 chipset supports 1xEV-DO, 1xRTT and
GSM/GPRS, CDMA and GSM operators can bundle and resell EV-DO services from NextWave with
devices that will also support voice and data over their existing networks. They could
even provide nationwide roaming outside of EV-DO coverage areas with either 1xRTT or GPRS
on the same device from day one.

Think about what this could mean to U.S. consumers as well as the wireless community.
There would be a nationwide mobility high-speed, high-capacity, wide-area network, perhaps
tied into Wi-Fi hotspots where applicable, available for both mobile and fixed usage
(where cable and DSL is unavailable) at speeds comparable to cable modems and DSL. There
would be aggressive pricing, lots of great applications and content for the enterprise and
consumer market segments across an amazing array of color-screen devices from camera
phones to PDAs to laptops, tablet PCs, gaming consoles, set-top boxes and more.

As it has in Korea and Japan, this approach can turbo charge wireless content/applications
and device development in the U.S. This is not a case of if we build it, they will come.
Rather, it is a case of if at least a few key players including NextWave come together and
make it happen, they will have access to the one economically viable network that will be
able to deliver content and services to consumers and business customers alike at very
attractive prices. Companies will still be able to differentiate their service offerings
with their existing voice and lower-speed data networks as well the content and services
they offer.

I believe that content providers and non-wireless Internet providers would jump on this
opportunity. It is the best and fastest way to get a high-speed data connection to most of
the U.S. population. It will not be an inexpensive undertaking, but if those that want to
make use of this network step up and invest in it, the network can be built quickly and
revenues can start to flow more quickly than with any network in U.S. history.

If things worked out right, this network could be up and running in a significant part of
the U.S. potentially years ahead of any other truly broadband technology and it would set
the bar for data services in the U.S. In fact, some GSM/GPRS players might find it more
economical to join the NextWave system than to build out their own 3G data systems,
freeing up their limited and valuable spectrum for voice customers. The opportunity is
"here and now" and the industry should support this cooperative approach for the benefit
of all. There are no losers when everyone can tap into the same capability that energizes
a mind-boggling array of new applications, devices and services for enterprises and
consumers alike. This will give a significant early boost to the broadband wireless market
making it ripe for new revenue opportunities for all wireless operators in the years
ahead.

What should NextWave do with its spectrum? I sure do hope they give my idea its due by
going with "DO."
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