Monday, April 20, 2009
The New Number Two In Wireless Communications
There has never been any doubt as to who is the biggest company in the communications business. We all know that is Motorola. What many of us don't know is who is Number Two? If you think it's ICOM, Johnson, or Kenwood, get ready for a shock. The new Number Two in wireless communications is the Harris Corporation, a leading military communications equipment supplier and a strong advocate of P25 technology.
Tyco Electronics has struck a deal to sell it's wireless system business (formerly M/A-Com) for 675 million to Harris Corporation. Harris reported that the acquisition would be closed by the summer of 2009 and that Tyco's systems unit would be reported as a discontinued operation by the beginning of July. This acquisition clearly places Harris as Number Two in size in for wireless communications manufacturers with a major emphasis on military and public safety communications.
Many in the industry had felt that the EDACS and Open Sky technology developed by M/A-Com was superior to the P25 standard. Apparently, the state of New York did not agree, and it appears that EDACS and Open Sky will follow the road paved by the 8-Track Player, Beta Max, and the Edsel.
For those involved in military and public safety communications, this would appear to be more verification of the acceptance of P25 as the U.S. digital communications standard. Howard L. Lance, Harris CEO, stated that this acquisition would greatly expand the company's reach in the emergency communications sector, estimated be worth nine billion dollars and growing at 5% annually. Harris is no stranger to the commercial communications sector, having been a major manufacturer of pagers, mobile phones, and high tier 2-way radios in the 70's and early 80's.
Tyco announced that the sale of the wireless business unit would allow the company to streamline it's operations. We suspect that a secondary benefit would be the avoidance of a costly and contentious law suit with the State of New York.
What does all this mean to our public safety users? Basically, we see the Harris purchase as validation of P25 as the digital standard in the USA. The net result will be a trend toward common operating systems rather than closed architecture, coupled with lower equipment cost evolving from increased competition. We could be wrong. We've been wrong before, but can't remember when it was.......