Bulkley notes that because specialized mobile radio is already digital, it has a significant technical advantage over cellular service. He also said that because private mobile radio services are less highly regulated than cellular and free of federal limits on foreign investment, the industry may attract capital more easily than did cellular.

"The cellular industry is going to have to spend a lot of money to convert its customers from analog service to digital," Bulkley said. "And a lot of foreign money could" pour into specialized mobile radio, he added.

But the cellular industry, which in the past vigorously opposed private mobile radio, now insists it can compete if the FCC loosens restrictions on the industry.

"The cellular industry today realizes that their past opposition to (private mobile radio) was short sighted," said Thomas Wheeler, president of the Cellular Telecommunications Industry Assn., a Washington trade group.

"Today we are saying, 'Let the competitors in and let us compete too,' " Wheeler said.