ing companies and taxicab companies. Nextel purchased these frequencies in the nation's largest cities and combined access to the airwaves with its digital technology. Digital technology provides clearer broadcasts and increases the capacity of the system to handle more calls. While O'Brien and his partner, Brian McAuley, can be credited for recognizing an opportunity which was largely ignored by other companies, the competition (which included McCaw Cellular at the time) did not look favorably on their innovative thinking ("Fortune Visits," 1993, p. 62).
Cellular companies, including the RHCs and McCaw Cellular, sued Nextel during the early years on the basis that the FCC permits only two cellular operators for each city and that Nextel's entry into the market violated this arrangement. The competition wanted Nextel to formally petition to use the frequencies it had acquired for cellular use, a process which would take three years (on the average) and which would severely limit the competition in the market. Nextel argued that the popularity of cellular phones had led to a situation where the current providers could not meet demand, and that Nextel's use of the frequencies it had purchased would serve the consumer. Nextel also argued that its digital technology was substantially different from the cellular technology then in place. In 1991, the FCC issued its ruling which sided with Nextel, and the company pressed forward. The competition took some comfort in that the phones required by Nextel users cost considerably more than the phones required by traditional cellular service, but Nextel's strategy of targeting corporate customers, which have greater resources available for this type of technology, and the continued downward pressure on wireless phones, would help Nextel overcome this problem. In mid-1993, Nextel employed slightly more than 350 workers in the United States ("Fortune Visits," 1993, p. 62).
By early 2000...