PHS-Based Data Transmission:
The Wait Is Over

by Noriko Takezaki

PHS was launched in Japan's major metropolitan areas in mid-1995. The coverage area has been continually expanding, and after slow initial growth, the number of PHS subscribers now exceeds 6 million (slightly less than one-third the number of cellular phone subscribers). As of April 1,1997, the market-leading DDI Pocket group had secured 2.9 million PHS subscribers, followed by the NTT Personal group with 1.9 million and the Astel group with 1.3 million.

Since April, these PHS groups have entered a new phase of competition due to the long-delayed introduction of 32K-bps data communications service (which offers three times the transmission speed of cellular phone-based data communications at half the price). Among PHS operators, the NTT Personal group has been most aggressive in promoting the new service, since it offers a golden opportunity to close in on the top position.

"We expect introduction of the 32K-bps data communications service to spur the growth of the PHS business market," says Koichi Harada, corporate marketing director of NTT Central Personal Communications Network, Inc. "Since corporate users handle more traffic and generate more income, we hope to expand our corporate market presence through this opportunity."

Setting the standard
The 32K-bps data communications service is not a new concept for PHS. Indeed, "Capable of data communications at 32K bps!" was one of the original promotional catch phrases at the time of PHS introduction in July 1995. Implementation of the service - intended to give PHS phones a competitive advantage over cellular phones - was delayed for nearly two years, however, because operators and manufacturers could not agree on the technological standard for the required end-to-end transmission control procedure. Other communications standards, such as the PHS-ISDN interface and PHS-air interface, were in place, but agreement on end-to-end communication remained elusive.

A major reason was that, to establish workable specifications for the end-to-end data communications standard, the participation of PC manufacturers was essential. Not fully mindful of this point, and hindered by the closed nature of the conventional telecommunications business, necessary discussions among operators and manufacturers on standards development did not begin until shortly before the launch of PHS services.

The MPT, concerned about the situation, hastily stepped in and backed formation of the nonprofit PHS Internet Access Forum. The MPT charged the forum with formulating a standard through consultations among PC makers, electronics product manufacturers, and system integrators as well as PHS operators.

The forum originally planned to finalize the end-to-end communications standard by March 1996. It required much more time than expected, however, for forum participants to reach a consensus. In particular, DDI Tokyo Pocket, which planned to start its own data communications service earlier than the other PHS groups, was reluctant to accept the proposal put forth by the NTT group companies. (PHS operator NTT Central Personal, NTT headquarters, NTT Data Communications Systems, and NTT Mobile Communications Network were all forum members). DDI Tokyo Pocket reportedly was insistent that its own data communications service method be recognized as the industry standard.

In the end, the forum members reached a compromise agreement. The end-to-end data communications standard was finalized in time to start 32K-bps PHS data communications services in April 1997. Although DDI Tokyo Pocket, in conjunction with other DDI Pocket group companies, unilaterally launched its own 14.4K-bps data communications service in October 1996, it agreed to make its service compatible with the forum-set standard from April.

PIAFS - A world standard?
The end-to-end data communications standard established by the forum is known as the PHS Internet Access Forum Standard (PIAFS). It includes such technical specifications as provisions to correct transmission error caused by Rayleigh fading, handover, and channel switching; high throughput using selective repeat and an automatic repeat request scheme; and frame synchronization for adaptive control of transmission delay. Although officially a 32K-bps standard, the actual effective data transmission speed of PIAFS is 29.2K bps. PIAFS-compliant terminal adapters are required to interface between PHS cell stations and ISDN (integrated services digital network) lines.

The DDI Pocket group's proprietary a-DATA data communications service, on the other hand, does not require a terminal adapter. DDI Pocket's cell stations automatically handle the conversion of the PHS signal for transmission over ISDN. As mentioned above, to coincide with the start of PIAFS-based data communications services by other PHS operators, DDI Pocket has introduced an enhanced version of its service. a-DATA 32 complies with both a-DATA and PIAFS specifications (although its effective communications speed of 28.8K bps is slightly slower than the PIAFS scheme).

"Unlike the other PHS operators' PIAFS-based service, our a-DATA 32 method doesn't require a costly terminal adapter to be installed for signal transmission via ISDN. We believe this is a very advantageous point of our service," says a DDI Tokyo Pocket spokesperson.

DDI Tokyo Pocket's view may be correct, at least for a while. Some Internet service providers (ISPs) have shown reluctance to deal with the PIAFS-based communications service. Preparation for PIAFS implementation requires an ISP to invest upwards of JPY 3 million to upgrade an existing access server, and much more to install a new PIAFS-compatible access server.

"We don't plan to upgrade all of our access servers for the PIAFS-based data communications service. We are, however, upgrading 5 of our 25 access servers, mainly those in major cities, to deal with the PIAFS-based service," says a spokesperson for Tokyo Internet, a major ISP dominant in the corporate segment. "The market [for data communications via PHS] is not yet clear to us at this stage. But a communications speed of 32K bps is surely attractive, so it eventually may appeal to business users."

Harada of NTT Central Personal, however, believes that concerns about the business prospects of the PHS data communications will ease as time passes. He suggests that consumers will duly understand the significance of the PIAFS standard, particularly once the market has matured and sufficient business applications have been developed.

"The point is that PIAFS is not just an industry standard in Japan. It is also the existing global standard, since it is the world's first standard for end-to-end communications," says Harada. "There is no way that a service backed by such an established standard cannot be strong enough in the long run. We understand that the equipment cost is an issue at this moment. But when the data communications market matures, the functionality to deal with PIAFS-based communications will be provided as a standard feature, so it won't require an extra cost."

"PIAFS is not just an industry standard in Japan. It is also the existing global standard, since it is the world's first standard for end-to-end communications."

"We expect the greatest demand for corporate applications will be for remote access to the office LAN [local area network] using a PHS hooked to a handheld PC or PDA [personal digital assistant]," says Harada. "Sales people can access the LAN even while they are out of the office, so they don't have to go back to the office [to enter or retrieve information]."

To promote such applications to the corporate market, Harada reveals that NTT Personal is negotiating tie-ups with PDA manufacturers and system integrators. "We plan to provide a comprehensive, integrated business package service in the latter half of this fiscal year," he says.

Several PDAs with a PHS data communications function are already available on the Japanese market. Sharp offers a PHS-handset data communications adapter that can be used with its best-selling Zaurus PI-8000 and Color Zaurus MI-10 PDAs. Seiko Instruments released the BrainPad TiPO, which features a dedicated Web browser, in October; the BrainPad TiPO can be hooked to a PHS handset through a PC Card recently released by Seiko Instruments. And PDAs with a built-in PHS function are being marketed by Kyocera (the DataScope, released in February) and Toshiba (the GENIO, released in April).

"The important factor will not just be how many subscribers an operator can get in the short term. It will be how the operators develop their business in the long run."

"For further competition, the important factor will not just be how many subscribers an operator can get in the short term," says Muneto Sawaki, an analyst at Dataquest Japan (of the Gartner Group). "It will be how the operators develop their business in the long run."

PHS abroad
Being generally satisfied with the development of "healthy competition" in the domestic PHS market, Japan's MPT has been promoting the overseas deployment of PHS, particularly in other Asian countries. Due in large measure to the MPT's persistent negotiations with other governments, an increasing number of countries have expressed their intent to introduce PHS.

The PHS Indoor System is already in operation in Singapore and Thailand, and PHS mobile communications services are slated to begin in Bangkok around the middle of this year. In Hong Kong and Australia, technical standards for the PHS Indoor System are now being formulated. In Indonesia, PHS pilot projects are being implemented, and PHS field trials have been carried out in China and Malaysia. In India, preparations are being made for field trials of PHS Wireless Local Loop.

To further expand the implementation of PHS in other countries, the first PHS World Congress was held last year in Asia. The second congress will be held in Bangkok in November 1997, supported by the PHS MoU group (a nonprofit organization in Japan for PHS promotion) and in association with PHS International (a private Hong-Kong company established in 1995 by NTT, NTT Mobile Communications Network, Cable & Wireless, Hongkong Telecom, and Itochu). An important discussion topic at this year's PHS World Congress will be the coexistence of PHS with other cordless terminal standards, such as Europe's DECT.

The MPT's aim in promoting PHS to Asian countries is not just to help Japanese firms market PHS products. The effort is also strategic preparation for the future deployment of the third-generation of mobile phones, called FPLMTS (future public land mobile telecommunication systems) or IMT-2000, in Asia. Japan has proposed wide-band CDMA (code division multiple access) as the global third-generation mobile phone standard, while the US is recommending its PCS (personal communication services) standard and European countries are supporting the UMTS (universal mobile telecommunication system) standard.

To compete with Western pressure to adopt the US or European standard, the MPT believes that Japan's single-handed effort will not be enough. Rather, the ministry views the involvement and support of other Asian countries as crucial. Deployment of PHS in Asian countries, besides offering business opportunities for Japanese manufacturers, is considered a key step toward gaining such support for Japan's FPLMTS initiative.

Japan's mobile phone subscribers
PHS subscribers
DDI Pocket group	2.88 million
NTT Personal group	1.85
Astel Tokyo group	1.29
Total:	6.02 million
Cellular subscribers
NTT DoCoMo group	10.96 million
Cellular Phone group	3.42
Digital Phone group	1.91
TuKa group	1.90
IDO	1.72
Digital TuKa group	0.95
Total	20.87 million
	(as of April 1, 1997)

For more information about the PHS MoU group, check its homepage at http://www.phsmou.or.jp. For details of the upcoming 1997 PHS World Congress, contact the congress organizer, IBC Asia Limited, at phone +65-732-1970, fax +65-733-5087.

The future for PHS did not always look so rosy. For more on the early growth of Japan's PHS market, see "A Handy Way To Phone Home: PHS," in our August 1995 issue (page 26), and "Japan's Personal Handyphone System: Down for the Count?", April 1996 (page 24). These articles can be found in the back issues section of the Computing Japan website, http://www.computingjapan.com.

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