AMERICAN PERSONAL COMMUNICATIONS NEXT-GENERATION WIRELESS SERVICES
By ERIN DAVIES

(FORTUNE Magazine) – BETHESDA, MD. Founded 1989 Revs.: $75 million (est.) Employees: 430 Private

Use a cell phone? Chances are you endure static, dropped calls, and the occasional loss of privacy (think Charles, Camilla, Di, et al.). Well, a new technology may soon lay your woes to rest.

In a joint venture with Sprint, TCI, Comcast, and Cox cable, American Personal Communications launched the country's first personal communications services (PCS) network last November, in the Baltimore-Washington area. Marketed as Sprint Spectrum, APC's network offers better clarity, reliability, and security than its cellular competition. The company's pocket-size handsets also function as answering machines, pagers, and caller-ID devices--services that cost extra with ordinary cellular. Just six months after the handsets hit the shelves, Sprint Spectrum boasts more than 80,000 subscribers.

PCS is essentially a new, improved version of cellular. Its networks are 100% digital, whereas most cellular systems are analog. PCS networks have operated successfully in Europe for years, but regulations and a shortage of available radio spectrum kept them out of the U.S. until 1995. The FCC awarded the company a "pioneer's preference" license because APC had been working on PCS technology since 1989, allowing it to buy new spectrum in its area at a discount price of $102 million. Sprint, TCI, Comcast, and Cox, which own 49% of APC, paid $2.1 billion for 29 other PCS licenses in last year's FCC auctions.

Chairman Wayne Schelle considers the partnership his ticket to becoming a force coast to coast. He'll need the help. Says John Ledahl, director of wireless research at Dataquest in San Jose: "By 1998 the competition will make the current long-distance ad wars pale in comparison." With AT&T Wireless, PacTel, Bell Atlantic/Nynex, and others expected to enter the PCS business soon, the pressure is on.

--Erin Davies