For most of us, our cell phones and Blackberries are constant companions that we have come to depend upon to stay in touch with colleagues and friends. Much of our mobile communication improves our personal and professional productivity and keeps us in close contact with family and friends.

But they are more than just gadgets for much of the world. Mobile devices are beginning to have a big impact on the economic growth of billions of people in poor countries, according to a recent series of articles in The Economist^[1].

Teledensity poised to surpass 100 percent

About 4 billion people now have a mobile phone, and many more have access to one. About 1 billion of those are in developed countries. About 3 billion of those are in developing countries, up from 1 billion in 2004. In the year ending March 2009, Africa added 96 million subscribers, China about 90 million, and India more than 125 million. “It looks highly likely that global mobile cellular teledensity will surpass 100 percent within the next decade, and probably earlier,” says Hamadoun Toure, secretary-general of the International Telecommunication Union^[1]. Mobile teledensity is a measure of what percentage of the population has a mobile phone.

Many people in the developing world who do not yet have a mobile phone have access to one. They are also a source of economic growth for many in very poor places. This is due to some innovative programs sponsored by a variety of telecom operators and philanthropic organizations in places like Africa. One such program, begun in Uganda but spreading quickly to other countries, enables someone in a poor village, often a woman who stays at home because of child-rearing responsibilities, to take out a micro-loan and buy a mobile phone, large battery, and an external high-gain antenna.

Phone calls are then sold on an individual basis to other villagers. The loans are typically paid back in a number of months, and profits after repayment contribute directly to income. Not only is this a source of income, it also promotes efficient communications, which in turn promotes economic growth. No longer must someone travel to another village or city to see a relative or conduct business. Not simply a replacement for or an accessory to land lines as in much of the West, mobile telecommunications in the scenario just described are the users’ first telecommunications.

Mobile phones promote economic growth in many ways. Fishermen off the coast of Africa can phone ahead to a variety of potential buyers of their catch before their boat returns to shore. This saves fuel and reduces potential spoilage in addition to securing the highest price. Individual entrepreneurs such as barbers and carpenters can now advertise their services by placing a message on a community message board, negotiate for business via their phone, and then go directly to the customer. It is no longer necessary to return to a central shop for messages or even to have a shop at all. Friends and relatives can communicate without making lengthy trips. Mobile phones increase productivity and efficiency, and they do so dramatically in countries that until recently had no telecommunications infrastructure at all.

There are new and interesting ways mobile phones are being utilized in many developing countries. In eastern Uganda, a service known as Farmer’s Friend allows farmers to send simple text messages to find out about weather forecasts or to get tips about pest eradication and best practices. Simple questions are answered via text message. More complicated ones are referred to experts who call back later. Similar services are offered in India and China. Google sponsors a service called Google Trader that matches producers and buyers of agricultural goods and commodities. The service received more than 1 million queries in its first five weeks of operation.

Prepaid calling credit fuels growth

The business model that has enabled the rapid growth of these mobile access services is prepaid calling credit[2]. In much of the West, mobile plans are postpaid; the customer receives a bill every month for past usage. This requires creditworthiness and readily available banking services, which are often not available in emerging economies. Many of these economies are cash-based. Prepaid plans save operators money, as they do not need to send out bills and chase down payments. Prepaid services are maintained by top-up vouchers, which are available in amounts as small as 50 cents in some places. These vouchers are routinely sold by agents in small shops and on street corners. These services create new jobs and ultimately tax revenue for governments.

The prepaid model is giving rise to another interesting and beneficial service: mobile money. It is growing out of the increasingly widespread practice of using prepaid calling credit as an informal currency. Sending money to someone else, often a relative, can be difficult in many places. It requires in-person travel or giving the money to an intermediary such as a bus driver. This can be risky business. By using prepaid phone credit, it is possible to transfer some of that credit to someone like a village phone operator, who then adds the credit to his or her own plan and pays cash to the recipient after taking out a commission.

It is fair to say that mobile telephony is having a bigger, more rapidly expanding impact on the lives of people around the world than any previous technology. This impact has been entirely positive. As more people around the world gain Internet access, the changes may be even more profound. Anyone working in the telecommunications industry today should be proud that they are contributing in a very real way to the betterment of people around the globe. That’s pretty cool.

AdvancedTCA Summit 2009

I’d be remiss if I did not do a bit of follow-up after the AdvancedTCA Summit this year, held October 27-30 at the Santa Clara Convention Center in Santa Clara, California. There was a good turnout, but down a bit from previous years. I suspect some of that is due to the loss of attendees who came in prior years to learn about AdvancedTCA and also attribute most of the decline to the poor economy and travel restrictions.

Still, it was good to see many familiar faces and many new ones. The technical sessions were great. Interestingly, two keynote speeches focused on the broad uptake of AdvancedTCA in a wide range of military applications, from ground- and ship-based systems to land mobile gear.

One of the presenters was Phil Turner from BAE Systems (Figure 1). Phil is a U.S. Navy Commander (Retired), and is currently program manager for the Defense Common Ground Station – Navy (DCGS-N) at BAE Systems. He has a broad background in a variety of military communications programs at a senior level. He talked about how open, common platforms with a high degree of reuse – as opposed to the proprietary stovepipe solutions of the past – are now a requirement for most military programs. That’s good news for our industry. He also explained why AdvancedTCA is being used and where. I had the pleasure of introducing Phil to the audience, and he is a very impressive guy. All of the Summit presentations are posted on the AdvancedTCA Summit website (www.advancedtcasummit.com), and I highly recommend looking at his.

Figure 1: Philip Turner, BAE Systems, spoke about stovepipe-style solutions being a thing of the past for military communications at the 2009 AdvancedTCA Summit in Santa Clara, California.

Jim Doyle, who is Congressional Affairs Liaison and Director of Strategic Business for military, aviation, and government sectors for Emerson Network Power, gave a good presentation on what it takes to be successful in government programs. It is a different world.

Eric Heikkila, Director of Embedded Hardware and Systems Practice at market research heavy VDC Research, gave another excellent presentation analyzing the size of the market for AdvancedTCA, its growth rate, and the reasons for that growth (Figure 2). In a nutshell, Eric thinks the total AdvancedTCA market this year is a bit greater than $500 million, growing to slightly under $700 million in 2010. He predicts that the market will surge to about $1.3 billion in 2012 and $1.7 billion in 2013, as LTE networks are deployed with a heavy emphasis on AdvancedTCA. Some of this will be commercial merchant product, and some of it will be built in-house or under contract to service providers. His talk had a lot of great background material on the dynamics of the market. It is also posted on the AdvancedTCA Summit website and is recommended reading.

Figure 2: Total Merchant ATCA Market Blades, Basic Platforms and Integrated Systems, 2008-2013 (US$ in Millions). Courtesy VDC Research

Lastly, I was delighted to be able to present the Conference’s Industry Leadership Award to Rob Davidson, former VP of Marketing for PICMG. He was given the award for his numerous and significant contributions to our industry. Rob has been a friend and colleague for 15 years, and the award is justly deserved. Congratulations, Rob.

Joe Pavlat

Editorial Director

References

[1] “Mobile marvels,” The Economist, September 2009 www.economist.com/specialreports/displayStory.cfm?story_id=14483896

[2] “The power of mobile money,” The Economist, September 2009 www.economist.com/opinion/displaystory.cfm?story_id=14505519