UPS to spend $127M on tri-mode wireless driver terminals

United Parcel Service Inc. plans to spend $127 million over the next five years on global deployment of a new driver terminal that features built-in cellular, wireless LAN and Bluetooth short-range wireless systems.

The DIAD IV driver terminal, a compact, rugged device powered by Windows CE .Net., includes a Global Positioning System (GPS) receiver, a bar code scanner and a color screen. The DIAD (or Deliver Information Acquisition Device) IV terminals were manufactured by Symbol Technologies Inc. in Holtsville, N.Y.

Atlanta-based UPS spent $22 million to develop the DIAD IV, which will be used by 70,000 drivers worldwide, according to spokeswoman Donna Barrett.

The new terminal hooks drivers into the UPS worldwide network from a customer's premises, allowing drivers to enter package tracking data into the network without having to walk back to the truck and hook up the terminal to a wireless WAN -- as they have to do with the current system, Barrett said.

The new terminal also confirms deliveries almost instantaneously: Drivers scan the package bar code, collect the receiver's signature electronically, type in the last name of the receiver, push a single key to complete the transaction and distribute the data, UPS said in its announcement.

"This electronic data capture ensures that UPS customers have the most current package tracking information available to them anytime, anywhere," UPS CIO Ken Lacy said in a statement.

Dave Salzman, UPS program manager for information services, said the short-range Bluetooth wireless system in the DIAD IV is designed to communicate with peripheral devices that the company may add in the future, including printers and credit card readers.

UPS also plans to use the Bluetooth system, which operates in the same 2.4-GHz band as 802.11b WLANs built into the DIAD IV, to communicate with customer computers that use UPS shipping software and also have Bluetooth wireless connections, Salzman said. He added that one reason UPS chose the .Net version of the Windows CE operating system from Microsoft Corp. was because it supported XML messaging, which will make it easier for the DIAD IV to communicate with customer PCs.

The built-in 802.11b WLAN system will be used for in-building communications with WLAN systems installed in UPS stations and hubs, Salzman said. In October 2000, UPS detailed plans to install WLANs at all 2,000 of its sorting facilities worldwide (see story).

The DIAD IV, which UPS plans to start deploying next year, replaces the DIAD III. Introduced in 1999 at a cost of $100 million and manufactured by Motorola Inc. in Schaumburg, Ill. (see story), the DIAD III had a black-and-white screen and operated over a U.S. wide-area packet data network provided by Motient Corp. in Reston, Va., with a data rate of only 9.6Kbit/sec.

The DIAD IV, Barrett said, will operate over cellular networks based on the General Packet Radio Service (GPRS) standard that have a data rate of 20Kbit/sec. to 40Kbit/sec. or Code Division Multiple Access (CDMA) 1xrtt (single carrier radio transmission technology) networks that have an average data rate of 40Kbit/sec. to 60Kbit/sec.

UPS started a large-scale test of a GPRS network operated by AT&T Wireless Services Inc. in Redmond, Wash., with 4,500 DIAD III terminals earlier this year (see story). Last year, UPS completed an upgrade of 15,000 DIAD IIIs used in Europe so they would operate on a GPRS network operated by the T-Mobile division of Deutsche Telekom AG in Bonn.

Barrett added that UPS has not yet signed a long-term contract with AT&T Wireless pending the results of the tests. Cingular Wireless in Atlanta and the U.S.-based division of T-Mobile in Bellevue, Wash., also operate nationwide GPS-based cellular systems. UPS intends to use CDMA networks to provide coverage in areas not served by GPRS systems, Barrett added. Both Verizon Wireless in Bedminster, N.J., and Sprint PCS Group in Overland Park, Kan., operate nationwide CDMA networks.

UPS rival FedEx Corp. in Memphis started a rollout of a similar driver terminal based on the Pocket PC operating system last fall in a $150 million project designed to equip 40,000 drivers. The FedEx PowerPad operates over the AT&T Wireless Services GPRS network and incorporates Bluetooth technology as well as a built-in 802.11b wireless LAN system. But it doesn't have a built-in GPS like UPS's DIAD IV.

Barrett said UPS initially intends to use the GPS technology to aid dispatchers in Europe, where the company responds to calls for pick-up, unlike in the U.S., where the company has scheduled pick-ups on a daily basis at known customer locations. The DIAD's GPS receiver will transmit vehicle locations back to the dispatch center over the GPRS network, allowing dispatchers to quickly determine the vehicle nearest to a call, Barrett said. The DIAD IV has 128MB of memory, more than 20 times the memory in the DIAD III. A portion of the DIAD IV's memory could one day be allocated for maps that would be used with the GPS system, Barrett added.

Ken Pasley, director of wireless system development at FedEx, said that while his company uses GPS on long-haul trucks, the company had dismissed the idea of putting it into the PowerPad because of loss of coverage from the GPS satellites once a driver enters a building.

Pasley also said that FedEx eventually will be able to use cellular network-based location systems in the U.S., once the cellular carriers have rolled out the federally mandated service nationwide.

Salzman said that UPS doesn't need to track a driver inside a building; it just needs to know the driver's last stop location. He added that the cost of adding GPS capabilities to the DIAD IV was "incremental."

Pasley also disclosed that FedEx is considering using CDMA cellular service in addition to GPS in the U.S. to improve coverage and is looking for the industry to develop a chip-based GPRS/CDMA system.

Chris Kozup, an analyst at Meta Group Inc., said UPS and FedEx continue to lead the way with integration of wireless in vertical, enterprise markets.

"UPS and FedEx have always been innovators, and they are now pioneering the integration of multiple wireless technologies" into a single device, Kozup said. He said UPS needs to stay ahead on the technology curve because many of the concepts and business applications it pioneered, such as automated package tracking, have been adopted by rivals, including the U.S. Postal Service.

Copyright © 2003 IDG Communications, Inc.

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