A chip breakthrough announced by Texas Instruments (TI) on Monday looks set to lower the cost of entry-level mobile phones.
TI has created a single chip that integrates most of the computing functionality needed by a mobile phone. Putting the digital baseband, SRAM, logic, radio frequency (RF), power management and analogue functions on one piece of silicon will, TI says, make it cheaper and easier for manufacturers to build entry-level phones.
Typically, mobile phones contain one chip devoted to handling the RF, as well as other chips for other functions. A high-end phone might have a separate chip for polyphonic ringtones, for example. But these chips are only one part of the overall cost of manufacturing a phone, with the battery and screen also key factors.
Nokia is already onboard, and said on Monday it will use the Digital RF Processor (DRP) technology in future handsets. Initially, Nokia will target the entry-level mobile phone market in countries such as India and China.
With mobile phone penetration in mature markets such as the US and Western Europe approaching saturation point, phone makers and network operators are increasingly eyeing other parts of the world for new subscribers.
TI's DRP technology may also have big implications for companies in the UK.
Dean Bubley, founder of analyst firm Disruptive Analysis, believes that it could help to push the cost of making a basic mobile phone as low as $25 within a couple of years, which would mean handsets could actually be given away.
"It could be like the watch market of 20 or 30 years ago, when companies could give away a watch with their corporate branding," said Bubley.
"Some firms give away mouse mats and USB memory sticks today. Soon, it could be branded mobile phones instead."
If Bubley's prediction is accurate, then there could be serious repercussions. Mobile phones contain a number of potentially dangerous substances, such as arsenic, cadmium, zinc and lead, which can harm the environmental if the handset is not disposed of in a responsible manner.
Recent figures suggest that many millions of mobile phones become obsolete each year in the UK. Several handset recycling schemes already exist, including Fonebak, and the Mobile Phone Recycling Scheme.