Nextel Launches New Wireless Service in State

Nextel Communications Inc. on Thursday launched a digital wireless communications service in California, a first step in the company’s ambitious plan to create a nationwide system to compete with traditional cellular phones.

Aimed initially at businesses, Nextel’s phone is larger than a typical cellular phone, but can be used for a range of communications including paging and two-way radio dispatch.

The Rutherford, N.J.-based firm, backed by Motorola Inc., has over the last several years stitched together a national network of the radio frequency licenses used by taxi dispatchers. But Nextel absorbed a big setback last month when MCI Communications pulled out of an agreement to invest $1.3 billion in the company.

The digital system allows far more traffic to flow over one channel than the analog system still used by most cellular phone firms. The two cellular carriers in Los Angeles, Air Touch Communications and L.A. Cellular, are moving to convert their networks to digital.

Nextel has invested about $300 million to build cell towers throughout California. Because the radio frequencies the firm uses are broken up into tiny pieces, 130 towers were necessary just to cover Los Angeles.

At a press conference in downtown Los Angeles, Mayor Richard Riordan demonstrated the handset’s digital cellular function to respond to a text message from Sacramento Mayor Joseph Serna. Serna and Oakland Mayor Elihu Harris spoke to each other via the digital dispatch function.