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An Israeli peek into the future of telecom

Posted By Shoshana On November 14, 2004 @ 9:00 pm In | No Comments

Staying connected: some 46 Israeli start-ups showcased their products at last week’s Telecom Israel 2004 exhibition.While American consumers are just beginning to be able to download TV and video clips onto their cell phones, Israeli startup eBIZ.mobility is already marketing the next step: ensuring that frequent travelers don’t lose out just because they’re out of town.

For American users, sometimes all it takes is a short drive from city to suburb to incur roaming charges, in which coverage is transferred from a major cellular network like Sprint or Verizon to a smaller local carrier. Although the phone companies have created a model of how to supply coverage and work out payments on roaming phone calls, providing premium service like a video clip of the news still poses trouble for those out of range.

That’s because the big companies are afraid they may not recoup from the customer the money they have to pay content providers for rights to that news clip, ring tone or football game highlight, according to eBIZ CEO Jeremy Kagan.

“It’s not a technological issue, it’s a commercial issue,” he told ISRAEL21c last week at the Telecom Israel 2004 exhibition. The Beit Shemesh-based company was one of 46 Israeli startups at the exhibition. There are an estimated 2,000-3,000 startups in the country, according to Matimop, the Israeli industry center for research and development.

In voice roaming calls, the larger and smaller networks take between 30 and 90 days to figure out where subscribers were for a given call and how they should be charged, Kagan said, adding that the companies sometimes contest each other’s claims. But in contrast to data downloads, he said, phone roaming doesn’t involve an outlay of money since the companies deal with minutes of air-time rather than hard currency.

Demonstrating his point on a Hutchison cell phone from England, Kagan tried to download a video clip at the Israel Trade Fairs and Convention Center in Tel Aviv, where the exhibition was held. The response: service not available.

Kagan’s solution is to provide the means of guaranteeing payment by confirming the user’s identity and authorizing the transaction within a few seconds via a device called a roaming mediation gateway, or RMG, which looks roughly like two VCRs placed on top of each other. If networks such as Sprint and the local cellular providers with which it has roaming agreements each use an RMG, said Kagan, the companies could be assured that supplying a download would make them money, and the customers could see the touchdown they asked for. EBIZ plans to make money by taking a percentage of the profit the cellular companies make on RMG-assisted transactions.

“These technologies are mature but that doesn’t mean they’re fully deployed everywhere yet,” said Kagan, who moved to Israel six years ago from New Jersey. “That’s our business case – to try to ease the deployment of these services, to get rid of the mess so that customers can get these services and really make it universal.”

The RMG system can also be used to verify the identity of a customer making automatic payments with a technology akin to the EZPass toll system. Contactless payment cards, which look like credit cards, are widely used in the Far East for many goods and services, including public transportation and large stores. It’s coming to the U.S. too, says Kagan, and eBIZ is ready for it.

Israeli telecom startups are beginning to make a comeback since their heyday in 2000 and subsequent decline, said Matimop database manager Vera Neiman. Although the new millennium has seen many companies shut down, since 2003 Israelis “are starting to establish startups again,” she said. If trends hold, the amount of startups will keep growing, said Neiman. “This number is rising, always rising.”

Information and communication technologies products amounted to nearly 20 percent of Israel’s total business sector product in 2000, according to the Industry, Trade and Labor Ministry. In contrast, it was about 10 percent in the U.S. the same year and about 9 percent in Japan.

“Israeli society is open, curious and enthusiastically embraces technological innovations,” Prime Minister Ariel Sharon said in his opening speech at the exhibition. “Here, in the land of the prophets, there is nothing more natural than discussing the future as if it were a tangible reality, and a vision as if it were a plan to be implemented.”

Startups have been focusing less on information technology (IT) in the last two years, said Raul Goldemann, Matimop technological and industrial cooperation director, Israel-Germany. Between 2000 and 2002, he said, “IT was big.”

Now, IT still dominates Israeli startups, said Goldemann, but the optical and biotech industries are where the growth is.

The RAD-OP startup, for instance, uses optical-wireless technology to create an Ethernet connection between neighboring buildings up to 330 feet (100 meters) apart. It has created a 1.5-pound (700-gram) device that takes 30 minutes to install, reducing the waiting time and cost of digging up the ground for fiber-optic cables, as well as any costs incurred in paying a monthly fiber-optic use charge or fees for the use of the building’s roof, which is needed for cable hookup.

The company is part of the Tel Aviv-based RAD Group, which consists of 15 independent companies in the telecommunications industry worldwide. It is now starting to market window-to-window Ethernet, which will first be coming out in December, and hopes to open an office in the United States beginning next year.

The easily movable device, which houses one large lens and one small lens, connects buildings at one gigabyte per second and can be used instead of cables to connect wi-fi access points or the buildings of an industrial complex or college campus. It can also be used as a secondary system to back up cables or to provide temporary access while cables are being laid.

While companies such as eBIZ and RAD-OP aim to improve the quality of high-tech life, other companies try to assuage the fear of risks that may accompany the benefits of technology.

Safecom tackles the potential risk of harmful radiation stemming from cell phone use, claiming that its phone design significantly reduces the level of the radiofrequency energy absorbed by the body. The U.S. Federal Communications Commission requires that wireless phones limit their level of radiation to a maximum 1.6 watts per kilogram. Computer simulations conducted by Safecom, which has not yet built a prototype of the phone design it is marketing, indicate that its phones would emit only 0.05 watts per kilogram.

If the simulation turns out to be accurate, Safecom phones would reduce radiation by between 85 percent and 97 percent of the current maximum radiation rates of phones sold in the U.S. As of July, the U.S. phones with the highest emission – called specific absorption rate, or SAR – give off 1.55 watts per kilogram, according to technology Web site CNET.

All cell phones emit radiofrequency radiation, but there are no known risks from exposure to these emissions, according to the U.S. Food and Drug Administration and the FCC. Nonetheless, the government agencies agree that further research is needed “to determine what effects actually occur and whether they are dangerous to people.”

Safecom wants to alleviate public concern, said its president, David Zilberberg. Cell phone companies “say they follow the [radiation] standard and that it hasn’t been proven to be harmful,” he said. “On the other hand, it also hasn’t been proven that it’s not harmful.”

The phone reduces radiation by simply rearranging the components: the transmitter is located in the lower half of the flip phone and held near the ear, and the antenna is located at the top of the phone. In this way, the radiation is emitted over the head instead of next to it. Several cell phone companies have told Zilberberg the redesign is feasible, he said.

“It will be many years until they know whether radiation causes brain damage,” Zilberberg said. If scientists discover that there are harmful effects and nothing has been done to reduce the radiation level by then, he warned, “It will be too late.”


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