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Last Updated: Saturday, 23 December 2006, 00:19 GMT
Mobiles still ringing in New Year
Jonathan Fildes
Technology reporter, BBC News

Model shows off a mobile phone
Mobile phones are packing more and more features
The mobile, almost unlike any other device, has changed the way we work, socialise and live our lives.

But although many of us could now no longer live without our mobiles, according to Sir David Brown, Chairman of Motorola, the mobile industry had no idea how successful they would become.

Speaking at a conference in 2006, he admitted that in the mid-1980s the mobile phone industry estimated that by the year 2000, there would be a market for about 900,000 mobile phones worldwide.

When we reached the millennium, he said, 900,000 phones were being sold every 19 hours.

And although the mobile market is now mature it still continues to grow at a phenomenal pace.

Mobile dependency

At the end of 2006 there were nearly 2.7 billion mobile phone subscribers globally, according to research firm Informa Telecoms and Media.

In 2007 Informa predicts that the total number of subscribers will top three billion for the first time, almost half of the world's population.

Man speaks on phone in India
Markets such as India are growing at phenomenal rates

"The power of mobile communications just keeps on getting greater and greater," said chief research officer Mark Newman.

"As users, we are getting more and more dependent on these devices."

And as this dependency increases, so too does our thirst for new handsets.

In 2006, nearly 950 million handsets were sold around the world, while in 2007, this figure is expected to pass the one billion mark.

The strongest demand for handsets is in the developing markets of India, China, Africa and Latin America.

Many of the phones sold in these areas tend to be fairly simple designs. But in the more developed parts of the world there is a desire for slimline, gadget-packed devices.

They have changed so much that engineers at Motorola now refer to them as "the device formerly known as the mobile phone".

Today in established markets such as Europe, no mobile phone is complete without an MP3 player, high resolution camera and an array of complex games.

Tasks like finding restaurants using location-based services on the handset will start to become the norm over the next year
Joe Bennett, Unique

And as technology continues to get smaller, memory cheaper and software more sophisticated, more and more features will be packed into these digital Swiss army knives.

"Over the next year you're going to see the first true convergence of features," said Joe Bennett, head of sales at Unique Distribution, one of the largest distributors of mobile phones in the UK.

Until now users have had to compromise on mobile phones, so for example if you wanted a high quality camera, few handsets would also offer the storage necessary to carry around a few thousand MP3s.

"In 2007 this will change and the user will have the option of combining many more features on one chosen mobile device," said Mr Bennett.

Smart phones

The New Year will also bring a new raft of services bidding for your time and wallet.

Mobile TV is being touted as the next big thing, but the killer application could be integrated personal satellite navigation.

"In the same way that we've seen a sudden explosion of satellite navigation in cars, we expect to see the same thing on mobile phones," said Mr Bennett.

Ian Bell of the England cricket team uses his mobile phone
Mobile phones could soon help you find your way around

"Tasks like finding restaurants using location-based services on the handset will start to become the norm over the next year."

Services like this are being driven by the rise in smart phones, mobile devices that have their own operating system and share many features with handheld computers.

Smartphone sales have increased by 75.5% in the last year to 37.4 million units, according to analysts Gartner.

This sharp rise, as well as offering greater functionality to handsets, may also cause a shake-up of the mobile industry.

Voice over IP (VoIP) is starting to make in roads into the mobile market.

Services such as Skype and Barablu can already be used on certain phones, potentially allowing cheaper voice calls.

However, data charges for many networks still remain high and many of the services are incompatible with one another. In addition, the need for a wi-fi enabled phone for many of the services means that VoIP will probably only trickle on to the market in the New Year.

"VoIP will start to become big through 2007, but it probably won't explode until 2008," said Mr Bennett.

Smart phones and so called "3.5G networks" are also driving a change in what have traditionally been perceived as PC past times: browsing the world wide web and emailing.

The mobile providers want you to commit to them
Mark Newman, Informa Telecoms and Media

This year, Icann, the Internet Corporation for Assigned Names and Numbers, which oversees the net's addressing system, rubber stamped the .mobi domain name specifically for mobile phones.

The first websites using the domain are expected to appear by late summer 2007.

At the same time more and more phones are capable of receiving email on the move, removing the Blackberry bottleneck.

"A lot of people we speak to are just working out how to get email on their phone," said Mr Newman. "This could be the single biggest change of 2007."

However, the most anticipated development of 2007 could be a mobile offering from Apple.

Many analysts predict that the California-based computer firm will launch a device which combines the features of a mobile phone with its popular iPod.

Apple has neither confirmed nor denied the rumours.

Security flaw

But 2007 may not bring all good news for mobile users.

Mobile operators are expected to offer more competitive bundles that roll together mobile contracts, broadband packages and television into one.

Man talks on his mobile phone
The new year will not all be good news for mobile users

Although this sounds like good news, Mr Newman says that the deals will come with a price.

"The mobile providers want you to commit to them," he said. "They will give you good deals but they'll certainly make sure that if you do try to move you'll pay a heavy fee."

Other potential pitfalls of the New Year have been identified by security firm McAfee, which predicts that 2007 could be the year when malicious programs on mobile phones really take off.

"We've seen a few hundred bits of malicious code written for mobile phones in the last couple of years," said Greg Day, security analyst at McAfee.

Many of these have been proof of concepts, but now there is a new generation of malicious code being written for mobiles.

"If the first wave was about proof of concepts the second generation is about 'how do I make money out of it?'," said Mr Day.

Threats uncovered so far include Trojans that send SMS messages to premium rate numbers and spyware that monitor phone calls and text messages.

People still think of their mobile as just a chatting device, when really it is now a small PC
Greg Day, McAfee

One piece of spyware, known as SymbOS/Flexispy.B, is able to remotely activate the microphone on a mobile device, allowing someone to eavesdrop on that person. Others can activate cameras.

Although attacks like this are still rare, people like Mr Day believe that the threat is increasing.

"It's a bit like building a bridge. More and more of the foundations are in place and it's just a matter of time before criminals look at this as a viable revenue stream," he said.

The good news is that security firms are aware of the risk and preventative measures can be built into the mobile network infrastructure.

However, Mr Day believes there also has to be a change in perception about what a mobile phone is capable of.

"People still think of their mobile as just a chatting device, when really it is now a small PC," he said.

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