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Putting It All Together


Every year cell-phone makers, eager to get you and your pals to trade in that old clunker for a new handset, roll out a host of gee-whiz features. One year it's a phone that snaps pictures or plays music. The next it's a handset slim enough to slip into your pocket. Over the past few months video has become the latest hyped feature to light up the (very) small screen.

Yet through all its permutations—thick and thin, candy bar vs. flip phone—the ubiquitous handheld gadget remains maddeningly imperfect. Goofy interfaces. Dropped calls. Balky downloads. Isn't it time the likes of Nokia (NOK) and Cingular Wireless made these darn things work better? Well, no promises here, but phonemakers say the next generation of mobiles rolling out this year and next will be simpler to use, drop fewer calls, and begin delivering a multimedia experience worth having. Ultimately, the industry hopes to make the cell phone what Rob N. Shaddock, Motorola's chief technology officer for mobile devices, calls "a remote control for your life." That's a fancy way of saying your phone will do everything from record TV shows to update the calendar on your PC, all while you go about your business.

Sounds good, but let's not get ahead of ourselves. If there's one thing the phone guys need to get right, it's making mobiles better at their main job: placing and receiving calls. The industry has an answer, and it's called Wi-Fi—the same technology that allows you to wirelessly hook together your home PCs.

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Right now, a mobile connection depends on your proximity to a cell-phone tower. Go indoors, and chances are the phone craps out. No one knows this better than the 6 million Americans who have dumped their land lines to go completely cellular. "In hospitals, in an elevator, and at a school, unless I'm standing near a window, I don't get good reception at all," says Paul S. Aubrey, 34, a music instructor in Kansas City, Mo.

To get around the problem, Nokia and Motorola plan to roll out dual-mode phones in the U.S. that use both the cell network and Wi-Fi hotspots in homes, offices, java joints, wherever. The phone is supposed to seamlessly switch from one system to the other, though how well it will work remains to be seen. "The combination of cellular and Wi-Fi is a powerful one-two punch," says Frank Hanzlik, managing director of the Wi-Fi Alliance, a trade group.

Theoretically, Wi-Fi will do more than make calls reliable. Dual-mode phones will also provide two ways of connecting to the Internet—and the Wi-Fi hookup will generate broadband speeds. T-Mobile USA already offers two phones that work with T-Mobile hotspots.

As with most things cellular, the first models may not work perfectly. Battery power is an issue, for example. Wi-Fi was built to transfer data from computer to computer. But gabbing all day on the phone consumes a lot more juice. Manufacturers say the first phones will be able to handle four to five hours of Wi-Fi talk time before dying. Eventually they hope to achieve a full eight hours. "We're making huge progress," Hanzlik says. "But at Day One we're not at nirvana."

You can say the same thing about existing cellular video services: Live TV it isn't—and people are not subscribing in the droves that Mobile ESPN, Verizon Wireless, and Amp'd Mobile had hoped for. Using Sprint Nextel Corp. or Cingular Wireless (T), the best you can expect is a short CNN (TWX) news update or an ESPN (DIS) baseball highlight. And if a bunch of people in your neighborhood are trying to watch those clips at the same time? The picture might fade out or not launch at all. "You can't just broadcast the cable company's lineup over cellular networks to hundreds of users today," says Paul Catalano, partner and wireless expert at consultant RelevantC Business Group.

To solve the problem, the industry is banking on new mobile systems such as QUALCOMM's (QCOM) and a rival network supported by Nokia, Intel (INTC), Motorola, and others. They promise to broadcast live TV signals to huge swaths of the country just as cable or satellite companies do. These systems will beam 20 to 30 channels at a time. And they're designed to be robust enough to allow the viewing of action-jammed events, such as football and basketball, that current technologies can't handle. By yearend, Verizon Wireless (BZ) is expected to launch QUALCOMM's (QCOM) service to about half its markets. But few expect the offering to work as well as advertised or become a red-hot success overnight.

Besides, getting millions of people to actually watch their phones will require making handsets less, you know, phone-like. It's certainly no easy task to make a device the size of a candy bar as simple to operate as turning on the microwave. But manufacturers and carriers are thinking hard about eliminating keys and adding more voice recognition. Rather than requiring you to press several buttons and plow through menus to search for, say, World Cup updates, phones of the future will likely need only one button push or voice command. Say "search World Cup," and up will pop several links. Response time will be faster, too. "There shouldn't be the click-wait, click-wait," says John C. Burris, Sprint Nextel's vice-president for product management. "It'll be right there."

O.K., here's the part you've been waiting for: the cell phone as universal remote control. Not far down the road, content—be it digital pictures, music, TV shows, or simply the lowly contact list—will likely be stored in a server on the Internet rather than in a PC. The phone will allow you to access and control that information wherever you are. You will use it to send pictures to your PC or TV. You'll ask it to record a show while you're on the road. You'll use the phone to play digital tunes in your house and then transfer them to your car as you walk to the garage.

Finally, you will be able to customize your phone as never before. And we're not talking about adding a little bling as a fashion statement. Starting next year, carriers such as Sprint and Verizon Wireless will go one crucial step further—allowing mobile-phone users to tailor their home screen to deliver whatever content they want. Turn on the phone, and you'll see scores for your favorite sports teams and up-to-date prices on your stocks. "The data can be pushed overnight to your phone or on the fly," says Sprint's Burris. Who knows? If Sprint and others can pull all this off, the venerable landline may be dead at last.

By Roger O. Crockett


Steve Ballmer, Power Forward
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