Nokia has demonstrated what it claims is the world's first dual stack IPv4/IPv6 handset.
Experts believe that IPv4 internet addresses will run out within two years, and will need to be replaced by the "nearly infinite" permutations of IPv6 addresses.
"First standardised in 1981, IPv4 has served as the basis of the internet as it has exploded over the past two decades. But this has stretched the IPv4 standard to its limit," stated Nokia.
"The growth in internet-connected mobile devices and emerging internet markets, especially in the Asia-Pacific region, is necessitating a change in standards."
In addition to dramatically increasing the number of available IP addresses, IPv6 provides extra security benefits including packet encryption and source authentication for end-to-end security.
It also allows a 'flow label' that can support real-time traffic in a mobile environment.
Interim fixes like Network Address Translation will, according to Nokia, work reasonably well for fixed devices. But they will create additional problems for mobile devices which can only be effectively dealt with using IPv6.
The company said that it will now offer prototype IPv6 CDMA handsets to operators for testing, and will be ready for commercial delivery of dual stack IPv4/IPv6 handsets during 2004.
"The introduction of dual stack IPv4/IPv6 devices is essential for the seamless transition of current IPv4 based networks and devices to the upcoming IPv6 environment," said Nokia.
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