What recession? Technology innovators keep the faith at CTIA

These entrepreneurs find meaning in their technology despite the downturn

LAS VEGAS -- Signs of a U.S. recession seem to be cropping up everywhere, but many at the CTIA Wireless 2008 trade show last week were full of optimism about the economy and the value of technology in general.

The show was attended by 40,000 visitors and hundreds of vendors, including a wide variety of small companies, some with only a handful of employees who were showing products or prototypes with ambitious prospects. Among them was a vendor who promised ways to improve mental health, while another was devoted to saving consumers a bundle on long-distance calling from home.

These are true technology believers who will keep working on a new chip or the next great algorithm even if the money men aren't interested. Some might call these people the mainstay of the U.S. economy, but nearly all of them -- engineers, programmers and the like -- are too modest to say they deserve such a lofty title.

On the CTIA show floor, several large vendors, such as Nokia Corp., provided smaller booths inside their own exhibits for developer partners. The partners were generally younger, and many showed their technology with the smiling faces of children selling lemonade.

Read brain waves wirelessly

One of the developers at the Nokia booth, NeuroSky Inc., demonstrated a brain-wave-reading headset. The headset was used to send brain-wave data via Bluetooth to a PC and to Nokia's N810 and N95 wireless handheld devices.

Horace Ko, a NeuroSky software engineer, wore the headset and used the feedback from the PC and devices to monitor the level of activity in his brain. When Ko attempted to relax his mind, as in a yoga exercise, he could watch an animated meter move from one to 10 on the PC and Nokia devices as he progressed. It demonstrated a form of the bio-feedback techniques popularized in the 1960s, this time applied using modern wireless devices.

Grey Hyver, marketing vice president at NeuroSky, said there are up to 50 developers of third-party applications working with NeuroSky's technology for a range of uses. In one future scenario, a truck driver might wear a Bluetooth headset equipped with a single brain-wave sensor. If the driver became drowsy, the brain-wave sensor could detect that state and send a message to ring the driver's cell phone to perk him up.

Other scenarios would enable children with autism or attention deficit disorder and adults with Alzheimer's disease to wear a headset and work inside a virtual world to practice interacting with avatars to improve communication, Hyver said. Developers are also working with the NeuroSky technology to create games that work on a person's brain commands and that would be communicated wirelessly, eliminating the need for a controller or keyboard.

In general, Hyver said NeuroSky's health-related applications will be relatively low-cost and widely available compared with expensive medical technology involving EEGs, which required years of medical reviews by the U.S. Food and Drug Administration. The drowsy-driver technology will require a review by the U.S. Department of Transportation, he said, but generally, "we couldn't exist as a company too long if we faced those kinds of reviews regularly."

Hyver said the entire NeuroSky team hopes that funding for their research continues, even as the economy sours. "Hopefully, it will be a short recession," he said.

While the economy matters, what drives Hyver and his colleagues is an interest in what NeuroSky's technology can do for people.

"The idea of being able to help people sustains us, morally," Hyver said. "Me, personally, for sure. Everybody has had somebody in their family with Alzheimer's or knows somebody with a brain-related illness."

A device for reducing phone bills

In another example of the entrepreneurial spirit at CTIA, inventor Dan Borislow demonstrated his MagicJack technology, which helps users reduced their long-distance phone bills. Borislow founded Ymax Corp. in Palm Beach, Fla., the maker of MagicJack, and has sold about 150,000 of the $40 devices since last September. Sales are booming, and he expects to sell another 150,000 in April alone, he said.

The matchbox-size device allows a telephone user to make long-distance calls basically for free by connecting the device through a USB port to a Macintosh or Windows-based computer, and then plugging in a phone on the other end. The $40 covers the cost of calls for a year over the Ymax voice-over-IP nationwide network, a price that is possible because of the company's wholesale sales of network capacity to other carriers. The second year of MagicJack service costs $20.

Borislow said he sells MagicJack to people "who are trying to save money in this recessionary period," noting that a user can save $60 to $70 per month on phone bills. "These are trying times," he added. During the 1990s downturn, Borislow said he started Tel-Save.com, a long-distance discount calling plan for AOL users.

"I guess I'm a terrible person," Borislow joked. "For me, recessions are a really good thing. That's when people look carefully at every bill they get." He said he knows times are bad just by talking to workers in his own company who are trying to avoid foreclosures as they pay off mortgages with rates of 12% to 14%.

What has given Borislow the greatest sense of pride in recent months is the thank-you notes he has received for donating the devices to mothers of U.S. soldiers, so parents can call their sons or daughters stationed in Iraq or elsewhere.

"I've gotten some pretty moving e-mails from the mothers," he said. "When I was 2 years old, my dad told me there's no free lunch, but I've been trying to prove him wrong for 46 years."

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