Dueling For Dialers

Consider the battle joined. In this corner, American Telephone & Telegraph Co., which last November jolted the phone industry with its agreement to buy a third of McCaw Cellular Communications Inc. In that corner, MobiLink, an alliance of 15 cellular operators, including six of the seven Baby Bells. At stake: the loyalty--and dollars--of millions of cellular-phone users frustrated by the numerology they must learn when they try to place or receive calls outside their home regions.

The MobiLink alliance, which was set to be unveiled on Feb. 18, doesn't deny it was created to counter the growing reach of McCaw, but executives of the companies involved say its formation predates the AT&T deal. McCaw has been assembling its own seamless cellular system under the Cellular One banner, which it plans to keep using in combination with the AT&T name. Already, customers can roam among most of the McCaw systems and send and receive calls without needing special access codes. McCaw has also enticed other cellular systems, such as those owned by Comcast Corp., to join.

Yet MobiLink dashes any hopes McCaw might have had of creating the only coast-to-coast cellular network. Indeed, the MobiLink companies say their system will make it easier to place and receive calls over a much larger part of the country. Now, the MobiLink group is waiting for McCaw's response. One possibility: McCaw could step up plans for its own national network by luring more companies to join.

DAUNTING DUO. One thing the MobiLink pact won't do is relieve the headaches that the Baby Bells are suffering from the McCaw-AT&T deal. The $3.8 billion link between the biggest cellular-phone operator and largest long-distance carrier will enable the two companies to package cellular and long-distance service in ways other cellular operators can't match. And McCaw gains the powerful AT&T name to market cellular service nationwide.

The MobiLink partnership has its own promotional plans, including a nationwide ad blitz starting in midsummer. But there's more to the alliance than marketing. The MobiLink companies will revamp their systems to make it far easier for cellular-phone users to place and receive calls when they're outside home territory. McCaw's linked systems already provide this feature, although over a much smaller service area.

Today, customers typically can't receive calls to their pocket or car phones outside their normal service areas. Sales executives from New York, for example, can't automatically get phone calls when they're in Atlanta. Instead, people trying to call them usually must first dial a special access number. And that number differs for each cellular system. The upshot: You often can't reach traveling cellular-phone owners unless you know where they are.

Similarly, many mobile-phone owners can't make calls easily when they're outside their home service areas. Instead, they must first call the cellular company serving the area they're in and get approval. Such tedious procedures make a mockery of the term "mobile phone."

NO-FUSS CALLS. The MobiLink system aims to change that. New software in the call-switching gear of member companies will alert the system to the user's location, allowing anyone to reach mobile-phone owners without knowing where they are. (In some places, however, cellular-phone owners will first have to key in a two-digit code to tell the system their new location.) And MobiLink customers will be able to make no-fuss calls in other MobiLink regions.

To take advantage of those features, some customers may have to switch to a new cellular service. In general, only two companies--one of them the local phone company--operates within each cellular service area. Because of antitrust concerns, MobiLink membership is limited to the cellular service offered by the local phone company.

Some cellular companies will find themselves on both sides of the fight. Pacific Telesis Group, for example, owns cellular systems jointly with McCaw and does business under the Cellular One banner. Others, such as U. S. West Inc., own systems outside their local territory and will find themselves competing against the MobiLink name used by the local phone company's cellular system. Such conflicts could prevent wholehearted endorsements of the alliances.

The mixed-up nature of the cellular business is why Southwestern Bell Corp. is not a MobiLink partner. The Baby Bell is a partial owner of the Cellular One brand, along with McCaw and another company, and it uses the name on its cellular systems outside its local-phone territory. That could raise antitrust concerns if the company also held a stake in the competing MobiLink.

Despite the mixed allegiances, the two-way rivalry among well-heeled players should improve customer service and highlight the industry's promise of "anytime, anywhere" communications. In other words, the real winner of this battle should be the consumer.

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