I n 1990, there were 11 million mobile phones in the entire world. Today, there are 50 million in Japan alone. Nearly 400 million people around the globe carry the various makes and models of wireless phones; those ranks swell by about 1 million more every week. Experts predict that within five years, that number will top 1 billion, surpassing the number of land lines. Mobile telephony is exploding because phones are getting smarter, becoming capable of doing just about everything a computer can. This is the dawn of the unwired world.
The boom is pushed by several factors. The first is the price of portable phones, which, like virtually all other electronic devices, has been plummeting. Even the top-of-the-line models now cost less than a third of what they did a few years ago.
But phones are only worth buying when they can be used, and the growth of a global infrastructure for wireless communications is the second key ingredient of the wireless boom. A truly worldwide web is just about in place. The pieces started to fall in place when Vodafone, a British cell-phone maker, bought AirTouch, an American rival, in January. That purchase forced other wannabe global contenders to respond in kind. Cable and Wireless bested NTT for International Digital Communications in Japan. MCI WorldCom bought Sprint last month; Germany’s Mannesmann followed by purchasing Orange, Britain’s third-largest operator. AT&T has teamed up with British Telecom to offer their customers service in 150 countries. And now Vodaphone AirTouch has launched a hostile takeover bid for Mannesmann.
An integral part of a global infrastructure is a single standard that permits the same phone to be used in different regions. This, too, is emerging, although the laissez-faire attitude of U.S. regulators has impeded homogenization in that market. Fostering competition among service providers has helped lower prices in the U.S., and spurred non-American companies to do likewise, but it has also created four different standards, which makes it difficult to use mobile phones a long way from home.
In Europe, the situation is different. In the early 1980s, the European Union mandated adoption of the Global System for Mobile Communications. That gave the standard a big boost and encouraged other regulators to do the same. The GSM standard, as it is known, has been adopted in 118 countries and serves about 40 percent of the world’s mobile-phone users.
The final factor behind the mobile-phone boom is the arrival of third-generation phones that effectively mate wireless devices and computers. This stage is only beginning. It is made possible by the development of sophisticated handsets that allow phones to do many of the chores that have previously been restricted to computers, such as send and receive e-mail and read pages printed on the World Wide Web. In addition to new hardware, the technology for yet another standard that permits data to be transmitted at high speed is coming on the market.
In this field, Japan is leading the way. NTT DoCoMo’s “i-mode” phone, a smart phone that offers Internet access and a variety of services, has over 2 million subscribers and is increasing by about 400,000 a month. Japan will be the first country to roll out the new 3G (third-generation) technology that delivers information at speeds more than 40 times faster than today’s modems. It is estimated that early 20 million Japanese will access the Internet through mobile phones by the turn of the century. Europe will be only a few months behind.
Smart companies are already teaming up to build the alliances that will exploit this new standard. Nokia, the Finnish cell-phone manufacturer, has hooked up with 3Com, owner of the Palm operating system, to make the next generation of smart phones. That deal will also include Ericsson and Motorola, who are partners with Nokia in the development of Symbian, a software for smart phones. Never far behind, Microsoft has formed an alliance with British Telecom to develop their own next-generation mobiles. Intel recently purchased an Israel-based company that makes chips and software for mobile phones, too.
There are virtually limitless opportunities in this new technology. It holds out the promise of delivering any bit of information anytime anywhere. For many people, that is great, but it is not without its dark side. Ubiquitous technologies also pose serious questions about privacy and freedom from unwanted surveillance. Smart phones raise entirely new issues for societies and governments to deal with. There is no guarantee that we will prove to be as versatile or as “intelligent” as our technology.
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