more new customers) and make it available to existing customers without creating havoc within the sales, support, and accounting organizations? Retroactive Enhancement This is a retroactive enhancement problem. Basically, retroactive enhancement is the process of incorporating newer and better capabilities, features, and functions into the suite of offerings to consumers without upsetting the nature of the service agreements made with existing customers. In the wireless industry that is growing and changing at a very high rate, new technologies and innovations are constantly making older ones obsolete. For example, let's say that on the day you started your company AMPS was the best technology available. You created a business model that allowed you to recoup the investment you made into the AMPS network (towers, cells, infrastructure, etc.) by offering customers a certain level of service. Two years later AMPS technology is looking less than attractive to most consumers (and to you) as CDMA and GSM provide the ability to carry much more traffic of higher quality for each cell installed. The challenge for the existing AMPS carrier is clear. Do I try to maximize my current AMPS business model or upgrade the network Chapter 4 to carry both AMPS and GSM, taking on a large additional expense to remain competitive and increase my customer base? Most companies choose the upgrade option if the licenses can be acquired. But this then creates a problem for your old customers and your old business model. You now have a new network, new costs, and better service to offer. What exactly do you tell your old customers? You could say, "Sorry, if you want GSM you have to re-subscribe." Or, "You have been such a good AMPS customer, we will give you a free GSM handset and lower your rates." Which will it be? Making that decision is not an easy one. Handset Promotion: The Bad Surprise This problem of retroactive enhancement is especially difficult in the area of handset churn. Customers like new handsets, and they are happy to get 