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Sellers Wish Public Would Pick Up on 'Smart' Phone

Telecom: The devices have had few takers, even though they're a cheap, easy way to get online.


WASHINGTON — As Silicon Valley celebrates the debut of an inexpensive personal computer to access electronic information, the phone industry is struggling to win acceptance for an even cheaper and simpler device for going online: the "smart" phone.

Smart phones, which sport a small display panel, special navigational controls and a traditional 12-button keypad, have been available for more than a year for less than $300. But the telephone industry--which has had a mixed record of selling phone products, ranging from call forwarding to caller ID--hasn't found many takers, even though the devices are among the cheapest and easiest ways to gain limited access to cyberspace.

"Right now people don't wake up in the morning and say, 'Boy, I need one of these screen phones,' " said Joe Payne, vice president of marketing for U.S. Order Inc., a Herndon, Va., company that is marketing a smart phone product called Intelifone. "A lot of education needs to take place."

Smart phones, which let users exchange e-mail, do home banking and shopping, check stock prices and perform advanced telephone call management, are among a host of electronic devices vying to become the information appliance of the next decade.


The phones are not only intended to challenge the traditional personal computer, but also the network computer, now being promoted by Sun Microsystems and Oracle Corp. as cheaper and easier to use than a PC, as well as new $350 TV-top boxes being marketed by Sony Corp. and Philips Corp. as an easier way to surf the Internet.

At stake is a potentially huge market for equipment sales and electronic information services that will total $1 billion by 1998, predicts Research First Consulting Inc. The Atlanta firm forecasts that new calling services designed for smart phones will generate more than $500 million in additional phone company revenue. They include a new deluxe call waiting identification service that is already being offered in more than a dozen states and permits callers to use many of the advanced call management features many businesses now enjoy.

For example, deluxe call waiting ID teamed with a smart phone enables you to see the name and number of the person calling and allows you to dispose of the call, even if you're on the phone. You could, for instance, send the incoming call to voice mail, put it on hold or end your current conversation and pick up the new call, all by pressing icons on the display panel of the smart phone (rather than having to remember complex codes).

Similarly, the display panel makes it much easier to navigate voicemail menus, pay bills or get updated information such as weather reports and stock prices.

"Everyone is caught up in the Internet craze, but for a lot of people a computer is overkill . . . [when] all they want to do is check a stock price or find out if school is closed" because of inclement weather, said Sam Cassetta, chairman of SmartServe Online, a Stamford, Conn., company that sells information services to smart-phone users for prices starting at $9.95 a month. "People want a quick and easy way to get information."

That was the motivation that drove regional phone company BellSouth Corp., telephone equipment maker Northern Telecom and the Bellcore research lab in 1988 to develop a new standard--known as analog display service interface, or ADSI--that enables the telephone network to send both voice and text information to a telephone equipped with a display.

ADSI makes smart phones powerful communications devices by using their screens to display information. Instead of contending with voicemail instructions that require callers to remember the correct digits to press, ADSI lets callers navigate such menus using a visual display.


Convinced that phones that think for themselves could prove a huge hit with consumers befuddled by more complex personal computers, some of the electronic industry's biggest names have signed up to promote the technology.

Smart-phone manufacturers include Philips Homes Services Inc., a unit of the Dutch consumer electronics giant Philips; Northern Telecom; U.S. Order; and start-ups such as InfoGear Technology Corp. of Redwood City, Calif.

In addition, a number of firms, such as Smart Serve Online, are helping promote the technology by offering daily horoscopes, stock quotes, local weather reports, school closings and other information services.

But poor marketing by the firms' phone company partners, as well as the smart phone's ergonomic shortcomings, have rendered the devices a less-than-ideal Information Age solution. With its paperback-book-size screen and tiny keyboard, the phones aren't very good at managing e-mail, navigating the Net or doing complex electronic banking chores.

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