For cell phone makers, Gen Y = Gen $

Handset makers at the Cellular Telecommunications & Internet Association show are aiming much of their new product at U.S. 18- to 24-year-olds.

Ben Charny Staff Writer, CNET News.com
Ben Charny
covers Net telephony and the cellular industry.
Ben Charny
3 min read
LAS VEGAS--Handset makers unveiled a smattering of the next generation of cell phones Tuesday at CTIA, with many aimed at the world's 426 million teenagers who are expected to spend more than adults on phones.

Most of the new offerings are from the traditional handset makers such as Nokia, Ericsson and Motorola. But others were introduced by companies that haven't dabbled in the phone market, like Microsoft, which demonstrated its Stinger smart phone.

With cell phones already saturating markets in Europe and Asia, phone makers are setting their sights on North America, where computers still outnumber cell phones. The real buying power, according to analysts like Gartner Dataquest, lies with members of Generation Y, or 18- to 24-year-olds.

This group should be outspending adults on cell phones and upgrading more often by 2003, according to analyst projections.

"There were only 146 million baby boomers," said Nokia Vice President Rich Geruson. "There are 426 million (Generation Y) members. Obviously, we don't own the planet anymore."

After the strains of Generation X comedian David Spade's comedic tantrums died somewhere in the corner of the Hard Rock Hotel during the Cellular Telecommunications & Internet Association show, a smoke-filled laser show accompanied the world's first look at two new editions to Nokia's 3300 series.

They feature six different phone covers in colors like Icelandic Blue that are "meant for the young and young at heart," Geruson said. The phones, which will be shipped in the third or fourth quarter, are Web-enabled and cost between $75 and $100 each.

The phones also are capable of text chat, a relatively new service in the United States that allows people to exchange short messages between cell phones. AT&T began offering short messaging, which is an abbreviated form of text chat, a few weeks ago.

Additional features of the new Nokia phones include being able to accompany messages with graphic images.

Verizon Wireless began selling the Kyocera 6035 last month. That combination PDA/cell phone costs $500.

Mitsubishi announced it will be bringing two phones to the United States that use Microsoft microbrowser technology, according to Microsoft CEO Steve Ballmer.

LG Infocomm, which wants to capture about 20 percent of the U.S. handset market this year, unveiled a new version of a PDA/cell phone now sold by Sprint. The other version of the phone is capable of video conferencing, a service the U.S. version won't offer, company officials said.

Microsoft gave a public demonstration of its Stinger phone line and introduced its Motorola MSN T-9000, a pager capable of instant messaging and of receiving Microsoft's Hotmail information. The pager will be out by the end of the year.

Handset maker Ericsson is expected to unveil a new phone as well, this one also geared toward American consumers, according to a company spokesman.

But even Microsoft's Ballmer told the CTIA audience that all the gadgets in the world wouldn't mean anything until there is a high-speed, bug-free network in place. Carriers also have to find a way to offer attractive services that are affordable, he said.

"There is still a lot of work to do to," Ballmer said.