The industry spends a lot of its energy and a good deal of its cash flow on developing the high side. But no application will ever challenge voice as the mission-critical function of a mobile device. Human voice communication is one of the fundamental human needs, like procreation, food and shelter.

Despite the lack of mindshare, voice still accounts for at least 85% of mobile revenues. Data and "non-content" applications like mobile payments will offer incremental revenue streams, but operators should not overlook their all-time killer app.

VOICE GROWTH

Voice growth will derive from three areas: stealing fixed-line minutes, getting existing users to talk more and signing up new users.

The first two of these are on the high side of the market. Thanks to the march of the mobile phone through developing nations, the fixed-line opportunity is confined to the first world. Worldwide, wireline still accounts for two-thirds of all voice minutes, even though it represents less than half of all phone services.

In the face of the cellular juggernaut, fixed-line on its own hardly stands a chance. The mobile device offers ubiquity, convenience, functionality and the ability to personalize.

The challenge of persuading voice customers to make more and longer calls is a basic marketing one. It means bundling, the offering of on-net calls, bonuses for high volume users, and so on. But it brings with it the operators' dilemma.

These packages will certainly bring more traffic. That may--or may not--mean more revenue (though the aim is also to ensure rivals have less revenue and traffic). But the higher traffic will put additional capacity strain on the network.

Yep, we're talking fresh capex. For an operator taking on additional capacity loads, that inevitably means 3G.

MOBILE DIVIDE

The other part of the voice equation is getting phones into the hands of people who don't have them. In the next five years, they are most likely to be in India, China, Central Asia, eastern Europe and Latin America.

They are not going to be heavy phone users; they don't belong to a community of "wired" individuals. They are going to spend maybe $6 a month. But $72 a year spent by 600 million people (McKinsey estimates 628 million new subscribers in 2003-07) is an extra $ billion that the telecom industry currently doesn't see.

Thanks to the availability of prepaid and micro-credit, the actual service cost is hardly a barrier. Their main obstacle is the phone itself.

There is a source of low-cost, quality phones, and that's GSM manufacturers in China and Brazil. But they are licensed to sell their phones only in their domestic markets.

The comparison that comes to mind is generic drugs. African drug companies can make generic copies of HIV/AIDS drugs following a deal with big pharma firms. Is it too hard to make GSM voice handset IPR available for manufacturers in developing countries, or to export solely to developing countries?

The mobile phone has done more than any other technology to bridge the digital divide. Now let's see if vendors, operators and governments can meet the challenge of the mobile divide.

Robert Clark is a technology journalist based in Hong Kong ()