We're plugged into a mobile future

`We are just at the brink of receiving a whole array of commercial services delivered over our phones'

WE HAVE just become a four mobile phone family - all of us, dad, mum and two university-age daughters, now have our own mobiles.

There is nothing particularly remarkable about that, you might think and you would be right. What is remarkable is that it is not remarkable. Mobile phone penetration in the UK is sizzling up: nearly one-third of adults have them and we are not particularly advanced by European standards. In Finland, mobile telephony has already reached saturation point. I saw a story - which I can't quite believe - reporting that among the 18-25 age group, there is 110 per cent penetration (quite a lot of Finnish youths have two phones). Another three or four years and we will reach saturation too: anyone who wants a mobile phone will have one.

What does this mean? It means that another wave of the Internet revolution is about to sweep across us, because the mobile phone is becoming not just a way of talking to people. It is about to become something else: an access point to the world of electronic commerce.

Step back a moment. It is now widely recognised that Internet technology is revolutionising the business world. Hardly a day goes by without the announcement of several new Internet-related business ventures. Yesterday the most interesting one I spotted was the founding of a new Internet- only bank by the Co-op Bank. Great idea, probably do well - but really only more of the same sort of venture that has been filling the press for the past two years. This wave of innovation will continue, so that people who are prepared to crouch over their screens will be able to buy or sell just about anything.

But not everyone wants to spend their evenings pecking away at a computer. Europeans (and for the purposes of this exercise Britons count as Europeans) have proved much more resistant to buying things over the Net than Americans. I think it must have something to do with our different lifestyles. Americans have larger homes and tend after work to drive back and fire up the computer in the den. Europeans are more likely to slip into a bar after work, chat with friends and then take the train home. There is no separate room for the computer and by the time they are home they want a meal, a bit of television and bed. The last thing they want to do is to shop on the computer.

There are other social differences: there is more reluctance to give a credit card number over the phone (or by extension, over the Net); mail-order shopping in Europe tends to be a down-market pursuit whereas in the US it is up-market; and, of course, computer penetration is lower. But for whatever reason, computer-based electronic commerce has developed much more slowly in Europe than it has in the United States. When you turn to mobile telephony, however, the positions are reversed.

Half of the mobile phones in the US are still analogue; there are big gaps in the networks so quite often you find yourself out of range; the various different systems are only just being connected up; the recipient often has to pay for part or all of the call, so Americans tend to switch off their phones; and while there is a GSM (Global System for Mobile communication) system similar to our own - but on a different frequency - it only works in a few cities. And when Americans go abroad, their mobiles are useless.

By contrast, our ordinary GSM phones work almost anywhere in the world bar the US and Japan, can send and receive short messages, and - this is the crucial bit - are just about to become the access point for a host of Internet-related services. In America electronic commerce is based almost entirely on the personal computer. In Europe it seems likely that it will be delivered more and more on mobile phones.

Looked at rationally, the mobile phone has a number of advantages over the personal computer, even the laptop versions. It is smaller and therefore is always in your pocket or purse. It is usually switched on. It is personal to you. It has a battery that will last for several days, not three or four hours. It has an in-built billing service - anything you buy through it can be charged to the phone bill. It knows where you are at any particular moment - and even more important, it can give that information to anyone seeking to sell you a service.

Sure, it has disadvantages. The small screen and lack of a proper keyboard mean it cannot be used for surfing the Net. The one version with full Internet capability, the Nokia Communicator, has had only limited success in the market. Downloading is slow. But even these disadvantages can be turned into advantages, because they force anyone seeking to use the phone as a delivery mechanism to tailor their services to actual needs, rather than firing them out with a scatter-gun and hoping that some of the pellets hit the target.

We are now just at the brink of receiving a whole array of commercial services, delivered over our phones. A few, like the RAC service telling members the location of traffic jams, are up and running. A number of others are being rolled out elsewhere in Europe. The Finns are probably in the lead. There are a couple of soft-drink machines in Helsinki which will give you a can of Coke if you tap in a few digits into your phone - the cost of the can appears on your phone bill the next month. A bank there has a system telling account holders of their nearest cash dispenser. Because the phone knows what cell it is in and cells in cities are very small, the phone can direct the user to the machine without even needing to display a map.

For the next two years there is going to be a tremendous effort to discover what services we actually want on the phone and what we would prefer to receive on the Net.

Price comparison is one example where the phone has potential advantages. If you are wired to the Net, you can compare prices - there are several search engines hunting out best rates and you can decide how and whether you might buy something. Suppose you are in a shop, looking at a washing machine. You cannot go home, see if this is the best price and then decide what to do. But if you can tap a few digits into the phone, get a quick check on prices in stores nearby (remember it knows where you are), you can then decide whether it is worth going to another store a few hundred yards away to get a few quid off. (If you are in John Lewis, "never knowingly undersold", you simply tell the staff the price and the location and you get them to match it).

I can think of others. BAA has a great Internet site giving landing times at all its airports. Fine if you are at home or in the office with access to a computer; not so good if you are stuck in traffic and wondering whether the person you are supposed to be meeting is hanging around looking for you. What you want is a cut-down version of the Internet service delivered over the mobile phone.

All of this is possible with existing technology. When the next generation of mobiles come out, in two or three years, expect another burst of innovation. It is even possible that e-commerce over the phone will become so successful that using the phone for the simple act of talking to someone will be free. Phone companies will give us free calls in exchange for using their phones to buy things. I guess that is the stage when we become a five- phone family - and get one for the dog.