The next step is phones as audio players. Motorola, for example, just struck a deal with Apple to load its iTunes on some models. It'll be a while before the phones have enough memory or the networks have the capacity to compete directly with the iPod--but it's probably just a matter of time.

Mo' better blogging. Another feature gaining popularity is phone photography. Consumers already have shown they like digital pics--digicams are the hottest holiday gift this year. "People have strong, emotional responses to pictures," says Jeff Hallock at Sprint, which is perhaps the most aggressive pusher of photo messaging among U.S. carriers.

Grainy images diluted the impact of last year's camera phones, whose pictures didn't look good on PC monitors, much less as prints. But a few phones this year can capture more than a megapixel, and next year they will reach 2 and maybe even 3 megapixels. Those shots should look great on computers and even make decent 4-by-6-inch prints, despite the cam phones' weaker lenses and shorter zooms than those of stand-alone cameras.

Even blurry pics were enough to launch "moblogging," where users upload the intriguing and the mundane images from their daily mobile lives. Webster posts enough photos to her site that friends and strangers can see not only her formal dress but the damage to the family car when her dad hit a deer and pictures of the school bus rides ("bleck!") she had to take as a result.

But it can still be difficult to swap pictures among camera phones. Carriers expect that more people will join in the snapshot action once they can easily send photos from a handset using one carrier to a phone using a different service provider. But the companies first must decide how to move photos between networks; that won't happen until next year or later.

These new functions raise the question of how much one phone can handle. Some smart phones already have enough memory to handle a slew of MP3s and E-mail while tracking tasks and calendars. Some newer models, such as the Treo 650 and the BlackBerry 7100t, have better keyboards and software, and the online services are better designed. But Internet-type news and entertainment still disappoint because of slow downloads. While wireless carriers are rolling out advanced networks that promise broadband speeds for data downloads, these services remain too expensive for most users, starting at an extra $25 per month. Few in the industry now see one phone doing everything, says Strother at In-Stat. They're aiming instead to group the right combination of features for the right consumers.

For example, Donna Butler of Wimauma, Fla., is no gadget freak. But she got her daughter Danielle a cutting-edge phone when she learned it would track the 17-year-old's comings and goings. Butler pays an extra $15 a month or so to a new service called "Teen Arrive Alive," which uses satellites to trace cellphones and posts their whereabouts, plus the speed at which they're traveling, to a website for parents. Danielle bristled at the loss of privacy but liked the phone's added walkie-talkie-like service for instant chatting with friends. "That helped win her over," says Mom, who also told her daughter she wasn't going to spy unless given reason. "It gives me an edge," says Butler. "If something does seem wrong, I'm not just another parent helplessly worrying at home."

Carriers think they can make money if they can get, say, 1 of every 10 customers to bite on the new services--and some hope soon to be getting 10 percent of their overall income from nonvoice features. That's still far behind overseas carriers, which may soon draw 20 percent of their income from the whiz-bang stuff. U.S. carriers think they'll see similar numbers, despite protests that consumers here don't think they want more features. "People used to say that about mobile phones themselves," says Sprint's Hallock, and now many people can't imagine life without one.

Previous Page