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Mobile Telephone History
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First generation analog cellular systems begin
The Bahrain Telephone Company (Batelco External link) in May, 1978 began operating a commercial cellular telephone system. It probably marks the first time in the world that individuals started using what we think of as traditional, mobile cellular radio. The two cell system had 250 subscribers, 20 channels in the 400Mhz band to operate on, and used all Matsushita equipment. (Panasonic is the name of Matsushita in the United States.) [Gibson]Cable and Wireless, now Global Crossing, installed the equipment.
In July, 1978 Advanced Mobile Phone Service or AMPS started operating in North America. In AT&T labs in Newark, New Jersey, and most importantly in a trial around Chicago, Illinois Bell and AT&T jointly rolled out analog based cellular telephone service. Ten cells covering 21,000 square miles made up the Chicago system. This first equipment test began using 90 Bell System employees. After six months, on December 20th, 1978, a market trial began with paying customers who leased the car mounted telephones. This was called the service test. The system used the newly allocated 800 MHz band. [Blecher] Although the Bell System bought an additional 1,000 mobile phones from Oki for the lease phase, it did place orders from Motorola and E.F. Johnson for the remainder of the 2100 radios needed. [Business Week2] This early network, using large scale integrated circuits throughout, a dedicated computer and switching system, custom made mobile telephones and antennas, proved a large cellular system could work.
"The car telephone service was introduced in the 23 districts of Tokyo in December 1979 (Showa 54). Five years later, in 1984 (Showa 59), the system became available throughout the country. Coin operated car telephones were also introduced to allow convenient calling from inside buses or taxis." NTT
Worldwide commercial AMPS deployment followed quickly. An 88 cell system in Tokyo began in December, 1979, using Matsushita and NEC equipment. The first North American system in Mexico City, a one cell affair, started in August, 1981. United States cellular development did not keep up since fully commercial systems were still not allowed, despite the fact that paying customers were permitted under the service test. The Bell System's impending breakup and a new FCC competition requirement (external link) delayed cellular once again. The Federal Communication Commission's 1981 regulations required the Bell System or a regional operating company, such as Bell Atlantic, to have competition in every cellular market. That's unlike the landline monopoly those companies had. The theory being that competition would provide better service and keep prices low. Before moving on, let's discuss Japanese cellular development a little more.
Growth of Japanese cellular development
At the end of World War II Japan's economy and much of its infrastructure was in ruins. While America's telecom research and development increased quickly after the War, the Japanese first had to rebuild their country. It is remarkable that they did so much in communications so quickly. Three things especially helped.
The first was privatizing radio in 1950. No commercial radio or television broadcasting existed before then and hence there was little demand for receivers and related consumer electronics. Stewart Brand, writing in The Media Lab, quotes Koji Kobayashi in his book Computers and Communications: "Clearly the release of radio waves was a pivotal event that set off a burst of activity that revitalized postwar Japan. In this sense it is quite significant that every year on the first day of June a grand 'Radio Waves Day' takes place to commemorate the promulgation of the Radio Waves Laws." The second great help was Japan re-gaining its independence in 1952, allowing the country to go forward on its own path, arranging its own future. The third event was an easy patent policy AT&T adopted toward the transistor.
Fearing anti-monopoly action by the U.S. States Justice department, the Bell System allowed anyone for $25,000 to use its transistor patents. Although the first transistorized products were American, the Japanese soon displayed an inventiveness toward producing electronics that by the mid-1960s caused many American manufacturers to go out of business. This productivity was in turn helped by a third cause: a government willingness to fund research and development in electronics. Essner, writing in a Japanese Technology Evaluation Center report, neatly sums up most of the telecom situation:
"In 1944, there were 1 million telephone subscribers in Japan. By the end of the war, that number had been reduced to 400,000. NTT [Nippon Telegraph and Telephone] was established to reconstruct the Japanese telecommunication facilities and to develop the required technology for domestic use and production. Between 1966 and 1980, NTT went through an age of growth, introducing new communication services, and the number of subscribers exceeded 10 million by 1968. From 1981 to 1990, NTT became a world class competitor, with many of its technologies, including its optical communication technologies, being used throughout the world. In 1985, NTT was converted into a private corporation." [JTEC]
NTT produced the first cellular systems for Japan, using all Japanese equipment. While their research benefited from studying the work of others, of course, the Japanese contributed important studies of their own. Y. Okumura's "Field Strength and its Variability in VHF and UHF Land Mobile Service," published in 1968, is cited by Roessner et. al. as "the basis for the design of several computer-modeling systems." These were "[D]eveloped to predict frequency propagation characteristics in urban areas where cellular systems were being implemented. These computer systems (the two main cellular players, Bell Labs and Motorola each developed its own) became indispensable to the design of commercial cellular systems."[SR3]
Often thought of as the 'Bell Labs of Japan,' NTT did not manufacture their own products, as did Western Electric for the Bell System. They worked closely instead with companies like Matsushita Electric Industrial Co. Ltd. (also known as Panasonic in the United States), and NEC, originally incorporated as the Nippon Electric Company, but now known simply as NEC. As we've seen, Oki Electric was also a player, as were Hitachi and Toshiba. The silent partner in all of this was the Japanese government, especially the Ministry of International Trade and Research, which in the 1970s put hundreds of millions of dollars into electronic research. The Japanese government also helped their country by stifling competition from overseas, refusing entrance to many American and foreign built electronics.
The Ministry of International Trade and Research, otherwise known as MITI, controls the Agency of Industrial Science and Technology. That agency traces its roots to 1882, its Electric Laboratory to 1891. Many other labs were established over the following decades to foster technological research. In 1948, MITI Ministry folded all these labs into the presently named Agency of Industrial Science and Technology. Funded projects in the 1970s included artificial intelligence, pattern recognition, and, most importantly to communications, research into very large scale integrated circuits. [Business Week3] The work leading up to VSLI production, in which tens of thousands of interconnected transistors were put on a single chip, greatly helped Japan to reduce component and part size. It was not just research, which all companies were doing, but also a fanatical quality control and efficiency that helped the Japanese surge ahead in electronics in the late early to mid 1980s, just as they were doing with car building.
On March 25, 1980, Richard Anderson, general manager for Hewlet Packard's Data Division, shocked American chip producers by saying that his company would henceforth buy most of its chips from Japan. After inspecting 300,000 standard memory chips, what we now call RAM, HP discovered the American chips had a failure rate six times greater than the worst Japanese manufacturer. American firms were not alone in needing to retool. Ericsson admits it took years for them to compete in producing mobile phones. In 1987 Panasonic took over an Ericsson plant in Kumla, Sweden, 120 miles east of Stockholm to produce a handset for the Nordic Mobile Telephone network. As Meurling and Jeans explained:
"Panasonic brought in altogether new standards of quality. They sent their inspection engineers over, who took out their little magnifying glasses and studied, say displays. And when they saw some dust, they asked that the unit should be dismantled and that dust-free elements should be used instead. Einar Dahlin, one of the original small development team in Lund, had to reach a specific agreement on how many specks of dust were permitted." [Meurling and Jeans]
America and the rest of the world responded and got better with time. Many Japanese manufacturers flourished while several companies producing cell phones at the start no longer do so. Other Japanese companies since entered the world wide market, where there now seems room for everyone. Many years ago Motorola started selling into the Japanese market, something unthinkable at the beginning of cellular. And the proprietary analog telephone system NTT first designed was so expensive to use that it attracted few customers until years later when competition was introduced and rates lowered. The few systems Japan companies sold overseas, in the Middle East or or Australia, were replaced with other systems, usually GSM, after just a few years. But now I am getting ahead of myself.