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New Economy, Old Technology

By Robert MacMillan
washingtonpost.com Staff Writer
Monday, August 9, 2004; 9:49 AM

The Internet revolution that began in the early 1990s frequently generated exhortations to "go digital," join the "digital economy" or enter the "digital age." Proselytizing digital technology with such fervor lent the "other" kind of technology -- analog -- a has-been status. Analog, the consensus view maintained, was yesterday's news.

But it turns out that analog technology not only has its place in the digital age, but that the world still can't do without it.

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Today's New York Times looks at analog's role as the indispensable bedrock of digital technology development: "Digital technology, as every marketer knows, is synonymous with speed, precision and the future. The challenge, though, for those designing digital products is that no human experiences reality as a pattern of 1's and 0's. The natural world is, in engineering terms, a thoroughly analog realm of endlessly variable waves of sound and light, temperature and pressure fluctuations, and shifting magnetic fields. So it turns out the digital revolution is driving strong demand for advances in analog electronics, an arcane realm in which tens of thousands of products translate reality into 1's and 0's for computers and retranslate digital results into forms humans can perceive."

The article cited Texas Instruments as a prime example of a company thriving on its analog business, making the microchip manufacturer seem like a once and future technology pioneer. "'Most people think that the world has gone digital and analog is old and not hip,' said Gregg A. Lowe, the senior vice president who oversees most of Texas Instruments' analog business. 'On average, there's probably 15 analog chips needed for every digital processor you use.' In fact, analog semiconductors have become Texas Instruments' biggest business, generating about 40 percent of its $8.36 billion in semiconductor revenue in 2003." Texas Instruments, as the Times noted, started pioneering analog technology in 1930 when it was created to help oil companies search for oil fields using sound waves, though it didn't make analog chip technology its central business until the 1990s.

Analog, with its lack of precise on/off options and two numbers on which to base an entire universe, is harder for a company to pin down, the Times also reported. "Success in digital processors and memory chips boils down to recognizing accurately and rapidly whether a circuit is on or off. That simplicity makes measuring performance and cost relatively straightforward and has even allowed the industry to predict fairly accurately how fast digital technology will improve. But the more variable world of analog data defies the emergence of a blockbuster analog design that fits many products," the paper said. "There is not much total profit in many types of analog chips because the volumes are so low, but the profit margins per chip can dwarf those in other sectors of the semiconductor business. As a result, specialists in the most demanding analog components like Linear Technology and Maxim Integrated Products routinely report profit margins that other semiconductor companies envy."
The New York Times: A Digital World With Analog as Its Workhorse (Registration required)

Can You Hear Me Now?

Analog technology, or the lack thereof, has more immediate implications for the consumer market as well, The Wall Street Journal wrote in a front-page story today. The Journal article said that the latest generation of mobile phones being sold in the U.S. contain nearly every conceivable add-on, but their lack of analog add-ins has created a hole at their center.

"As wireless carriers make the transition from analog to digital networks, many consumers are discovering that their fancier digital phones simply can't complete a call in a lot of places where their old phones worked just fine. Problems with blocked calls and dead zones are afflicting callers in big cities, including New York and Los Angeles, but they are especially pronounced in rural areas," the Journal reported. "It's an unforeseen drawback of the telecommunication industry's big investment in so-called next-generation equipment. As a group, U.S. cellular providers have spent more than $146 billion to upgrade their networks from analog to more-efficient digital technology, according to the Cellular Telecommunications and Internet Association."

First, a note on how analog technology works in mobile phones, courtesy of the Journal: It "relies on a continuously variable radio signal to transmit a call, similar to the way vinyl LP records produce music," as opposed to the pulses of digital signals. While plenty of mobile phone networks use analog roaming frequencies in rural areas or other places where digital signals are weak, the Journal said, the phones themselves aren't being made with the technology to receive the signals. "All five of the top-selling phones from Cingular and AT&T Wireless -- including Motorola's popular V400 clamshell phone with a built-in camera -- lack an analog component. (Cingular is expected to complete its acquisition of AT&T Wireless later this year, which probably will make it the country's biggest cellular carrier.) One of Verizon Wireless's best-selling phones, the color-screen VX6000 camera phone by LG Electronics Inc., has no analog component," the Journal reported. "While the digital networks cover a large portion of the country, there are still enormous gaps. Wide swaths of the rural U.S., including much of Montana, Nevada, Nebraska, Colorado, Missouri, Kentucky, Vermont and New Hampshire, are still analog only, according to the Federal Communications Commission. That means myriad dead spots for users of many of the newer phones."

The reason for cutting analog components? Companies like AT&T cite light demand, but here's another reason: "Calling over analog networks often means the carrier is paying expensive, per-minute roaming fees to a smaller operator of an analog network. Eliminating the analog function eliminates those expenses."
The Wall Street Journal: Wireless Carriers Leave Many Callers in Dead Zone (Registration required)

Rikki Don't Lose That Number

There are times when a cell phone dead zone might as well be the kiss of death. One of the most practical outgrowths of the rise of the wireless phone industry is the "rescue call" for people going out on their first dates. The simple concept is that you prearrange with a friend to call you sometimes during the date so you can fake an emergency and bail out if things aren't going well. Never one to miss a marketing opportunity, the mobile phone industry is making sure you don't need to inconvenience your friends. "The peak time for dates from hell in New York City is Friday at 8 p.m. -- judging by the cell phone calls delivering emergency excuses to bolt," the Associated Press reported. "Truth is, they're fake 'rescue' calls -- now being offered by two cell phone providers, Cingular Wireless and Virgin Mobile USA. In an era of Internet-set dates, it's just customer service -- a hip way to wiggle out of an uncomfortable encounter."

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