Mobile IP is a tunneling-based solution which takes advantage of the Cisco-Created GRE tunneling technology, as well as Simpler IP-in-IP tunneling protocol. This tunneling enables a router on a user’s home subnet to intercept and transparently forward IP packets to users while they roam beyond traditional network boundaries. This solution is a key enable of wireless mobility, both in the wireless LAN arena, such as the 802.11 standard and in the cellular environment for packet-based data offerings which offer connectivity to a user’s home network and the Internet.
If it is necessary or desirable for a user to maintain a single address while they transition between networks and network media, Mobil IP can provide them with this ability. Generally, Mobile IP is most useful un environments where a wireless technology is being utilized. This includes cellular environments as well as wireless LAN situations that may require roaming. Mobile IP can go hand in hand with many different cellular technologies like CDMA, TDMA, GSM, AMPS, NAMPS, as well as other proprietary solutions, to provide a mobile system which will scale for many users. (http://www.cisco.com/en/US/docs/ios/12_0t/12_0t1/feature/guide/MobileIP.html [Retrieved June 9, 2010])
Some of the disadvantages would be that a Mobile IP requires a strong signal to connect to the Internet. In major metropolises, signals are easily obtained and a Mobile IP will be able to roam between networks with little problem at all. In many urban areas, however, coverage is still sparse and strong signals are difficult to come by. In general, the stronger the signal, the faster and more reliable the connection will be. In the case of a weak signal, it is typical for the connection to be slow and unstable. (http://www.chow.com/list_6383989_advantages-disadvantages-mobile-ip.html [Retrieved June 9, 2010])
I believe the biggest reason that Mobile IP is not what it should be is that there are too many places that are not covered by signals that can be picked up. Two years ago I was using my cell phone through AT&T as a modem with GSM. As long as I could get a signal on my phone, I could tether to any computer and get the Internet. So as long as the technology increases I believe it will become more widely used.