No Wires Attached Here

This year we celebrate the 110^th year since the inception of the radio while the microprocessor has just touched 50.

2.8 billion mobile phone users exist globally with 1.6 million new cell phones being added each day. India has 6 million subscribers added per month. Not only that, Informa, a market research firm, says 4 billion people will be mobile phone enabled by 2011. Now that’s a lot of wireless communication. And this is just the beginning. A total of 10 billion microprocessors are expected to be sold this year covering a vast range of applications – from computers to coffee machines. So what’s all the hullabaloo about ?

New wireless technologies will link not just people but plenty of objects as well. This is the crucial point of discussion. Philips, an electronics firm, plans to introduce wirelessly controlled lighting systems 5 years down the line for commercial buildings. Considering the rate at which microchips are being used to do more with shrinking sizes the possibility of incorporating a function like smoke detection is also possible. This boost in performance via chips is attributed to Moore’s Law (Gordon Moore who co – founded Intel, the world’s largest chip company) which says that the processing power of chips doubles every two years. Check out the graph for an evolution timeline.

The mobile phone industry draws in approximately $1 trillion in revenues annually, says Informa. And its growing further, only in emerging economies though – which is how India is sitting pretty waiting for more services to pamper the population. The rich markets as we all know are saturated. Deriving a host of services from radio we have the following –

A cool funky example that I personally was completely bowled over by, was the Apple and Nike collaboration. The iPod and Nike shoes can interconnect such that the player can select songs to match the pace of the runner. Insane. We’re well aware of large organizations using RFID tags for managing stock levels. Japan has similar wireless projects under way. Tests are being carried out on cars to develop systems that will prevent collisions. A private school in Tokyo has put wireless beacons on its students backpacks to keep them traceable at all times. Trust the Japanese to come out with such an application. WiMax too, has started finding its way around the globe. But all these wonderful things have their share of troubles.

There is no telling how the demand for these services is ensured since the technology is not in place yet. Cyber security is an issue of concern – cyber attacks are expected to grow at 50% a year. Secondly, nobody knows how to charge for such things. However, Sprint Nextel, a mobile operator thinks it has a way out. It plans to use flat rate pricing – a feature that is quite uncommon. Think of your normal cell phone usage ; the more you use it the more is your bill. With flat rate pricing and a host of facilities on offer ( eg- the internet ) one could just buy a TV or washing machine and plug it into the Sprint network. Voila !.. the pay-per-use funda is chucked out of the window. It wont’ stand as a commodity argues Sprint, since there will be a premium for special services. Pricing is critical. When Japan’s NTT DoCoMo introduced a flat fee for sending still images via cellphones, network traffic shot up within a short time.

I’d like to talk more about this wireless revolution about to unfold. But I’ll just leave you with one last example.

In Barcelona, the Baja Beach Club has a unique VIP lounge. Members are injected with a minute chip in the arm, (acting like an RFID) which is used to identify people when they enter and pay for their drinks. It sounds a little extreme but 94 people have been ‘tagged’ already. Many more will follow. Bizarre isn't it ?

The above was written with aid from a superbly written 14 page exhaustive report in The Economist. One helluva magazine!