Stephen Shankland/CNET

BARCELONA, Spain--Technology is going to make it harder to be a repressive dictator, Google Executive Chairman Eric Schmidt believes, but censorship could still create a "digital caste system" that will mean some people remain laggards in the global economy.

Information inevitably will leak like water out of areas where censorship prevails, he said in a speech at the Mobile World Congress show here. And mesh networks--peer-to-peer connections linking mobile phones to each other without central Internet access points--will make that information leak even faster.

"In times of war and suffering, it will be impossible to ignore the [information] that comes out," Schmidt said. Syrian President Bashar al-Assad's "brutality will be on display for everyone to see. In this world there will be far less room for dictators to hide [and it will be] far easier for people to mobilize. This is what we saw in the Arab Spring."

Schmidt isn't satisfied with information leaking out through back channels, though. "Forty countries engage in active censorship, up from four a decade ago. Google products are blocked in 25 of 125 countries in which we operate." Even in the United States there are "worrying" moves, he said, no doubt referring to the recently vanquished SOPA and PIPA legislation.

"They're going to fail," he said of censorship efforts, but added, "We need to act now to avoid the rise of this digital caste system."

Meanwhile, in the rest of the world, he predicted that technology will help improve people's lives, evening some differences between techno-savvy early-adopter elites, more mainstream middle-class people, and the 5 billion who today have yet to connect to the Internet.

"Technology is a leveler. The weak will be made strong, and those with nothing will have something," he said, sounding downright biblical in his pronouncement.

Schmidt spoke to a packed house and took questions for about half of his time on stage. Some executives might not be comfortable venturing off the script, but Schmidt fielded questions with relish.

His best laugh line of the evening came when an Iranian resident objected that Chrome wasn't available in the Android Market. Schmidt said it was because of U.S.-required legal sanctions, but it would certainly be available if he had his druthers.

"I'm with you," Schmidt said. "But prison--there's no bandwidth."

He also showed a talent for stand-up comedy when asked about Google Fiber, the effort to bring super-fast fiber-optic Internet access to the denizens of Kansas City, Mo., and Kansas City, Kan. Just what are the project's implications?

"People will want to move to Kansas City, Kansas," he quipped, getting a good laugh. (Clarification: some readers are interpreting this as a joke at Kansas City's expense, but that wasn't the impression I got from Schmidt, nor the one I tried to present. Regardless of interpretation, many in the audience definitely laughed, even if you can't hear much on the YouTube video of Schmidt's speech that didn't use an auditorium-wide microphone. Finally, having reported on Schmidt for several years, I would be very surprised to hear him disparaging any particular country or region, especially one his company exhibits as attractive partner for a major venture. He generally reserves his potshots for competitors and for politicians whose policies he doesn't like.)

More seriously, he added, "At the speeds we're moving, the distinctions between television, radio, DVD, and high-definition [video] just disappear. It's all just bits." That means the businesses of delivering that information will radically transform from today.

"So much of the infrastructure we grew up with is because of technical limitations which fiber simply eliminates," Schmidt said. "Ours should generate 300 to 500 megabits sustained," enough for "true holographic images."

And Google won't be the only one delivering such services. They exist already in Japan and South Korea and will spread. "A new intelligent infrastructure will emerge. By 2020, fiber networks will be deployed in nearly every city," Schmidt predicted.

Android, Google's mobile operating system, also will transform the world as ever-lower processor and storage prices mean lower-cost smartphones.

"Next year's $100 phone is this year's $400 phone," he said. "Many people are working on [smartphones] in the $100 to $150 range. When you get to the $70 point you get to a huge new market," especially because those phones are resold used for $20 or $30.

About 850,000 Android devices are activated every day, reaching a total of 300 million so far, and there are 450,000 apps in the Android Market, project leader chief Andy Rubin said here.

Schmidt is bullish on the growth. "Do the doubling every month, eventually it'll be a trillion," he said. "We need to produce more people."

Android has had plenty of problems--writing programs that work on the multitude of devices, branching out to tablets, upgrading older phones to newer OS versions, and fending off patent infringement suits, and variants that sidestep Google's ecosystem, for example.

Many problems will ease this year, though. "The year 2012 is [about] building out the full Android ecosystem," he said, including the difficult task of getting the next-generation Ice Cream Sandwich onto phones where it's largely absent today. He said Google will leave it up to market forces, not litigation, to draw Android strays into the Google fold.

"We hope the pressure from consumers" will mean the strays will see "the benefits of joining this larger Android ecosystem."