The International Telecommunication Union estimated that mobile cellular subscriptions worldwide would reach approximately 4.1 billion by the end of 2008 and mobile phones are starting to reach the bottom of the economic pyramid.

History

In 1945, the zero generation (0G) of mobile telephones was introduced. Like other technologies of the time, it involved a single, powerful base station covering a wide area, and each telephone would effectively monopolize a channel over that whole area while in use. The concepts of frequency reuse and handoff, as well as a number of other concepts that formed the basis of modern cell phone technology, are first described in , issued May 1, 1979 to Charles A. Gladden and Martin H. Parelman, both of Las Vegas, Nevada and assigned by them to the United States Government.

This is the first embodiment of all the concepts that formed the basis of the next major step in mobile telephony, the Analog cellular telephone. Concepts covered in this patent (cited in at least 34 other patents) also were later extended to several satellite communication systems. Later updating of the cellular system to a digital system credits this patent.

Martin Cooper, a Motorola researcher and executive is widely considered to be the inventor of the first practical mobile phone for hand-held use in a non-vehicle setting. Cooper is the inventor named on "Radio telephone system" filed on October 17, 1973 with the US Patent Office and later issued as US Patent 3,906,166. Using a modern, if somewhat heavy portable handset, Cooper made the first call on a hand-held mobile phone on April 3, 1973 to a rival, Dr. Joel S. Engel of Bell Labs.

The first commercial citywide cellular network was launched in Japan by NTT in 1979. Fully automatic cellular networks were first introduced in the early to mid 1980s (the 1G generation). The Nordic Mobile Telephone (NMT) system went online in Denmark, Finland, Norway and Sweden in 1981.

Cellular systems required several leaps of technology, including handover, which allowed a conversation to continue as a mobile phone traveled from cell to cell. This system included variable transmission power in both the base stations and the telephones (controlled by the base stations), which allowed range and cell size to vary. As the system expanded and neared capacity, the ability to reduce transmission power allowed new cells to be added, resulting in more, smaller cells and thus more capacity. The evidence of this growth can still be seen in the many older, tall cell site towers with no antennae on the upper parts of their towers. These sites originally created large cells, and so had their antennae mounted atop high towers; the towers were designed so that as the system expanded—and cell sizes shrank—the antennae could be lowered on their original masts to reduce range. thumb|A 1991 GSM mobile phone The first "modern" network technology on digital 2G (second generation) cellular technology was launched by Radiolinja (now part of Elisa Group) in 1991 in Finland on the GSM standard which also marked the introduction of competition in mobile telecoms when Radiolinja challenged incumbent Telecom Finland (now part of TeliaSonera) who ran a 1G NMT network.