Hardly a day goes by where I don’t read something about the rapid expansion of mobile phone services in emerging markets. According to one recent article, “industry analysts forecast that 80% of the next billion mobile phone customers will come from emerging markets. Africa, for example, has the fastest growing mobile market in the world. The continent's subscriber base grew by 66% in 2005 to 135 million users, compared with growth of just 11% in Western Europe during the same period.”

Craig Ehrlich of the GSM Association, a trade association representing more than 680 million mobile operators around the globe, asserts that “the global mobile industry is now connecting more than one million people a day. Within a few years, the mobile industry will have more customers in the developing world than the developed.”

This pent up demand is “putting pressure on infrastructure and handset providers to start tailoring some of their products to these emerging markets.” How they handle this opportunity will be one of the first examples of a mature industry retooling its strategies to meet market demand at the base of the pyramid.

So far, it’s primarily been about cost reduction. The wholesale cost of entry-level mobile handsets has fallen dramatically in the past 18 months – from $100 to below $30. Much of the credit for this belongs to the GSM Association, which has catalyzed the market for these low-cost phones through its Emerging Market Handset Program. Motorola was chosen to supply the first GSMA endorsed handset for this new segment, 12 million of which have been ordered since last year.