25 Years of the Cell Phone

Twenty-five years ago, during a media event at Chicago's Soldier Field, the president of Ameritech Mobile Communications made the nation's first commercial cellphone connection. He rang up Alexander Graham Bell's grandson on a Motorola DynaTAC handset that weighed 2 1/2 pounds and retailed for $3,995. The industry has changed dramatically in the quarter-century since. Through a series of mergers, Ameritech was absorbed into what are now the nation's largest carriers, AT&T Inc. and Verizon Wireless. Cellphones today are mainstream devices, owned by more than 80% of Americans, that can fit in a back pocket. And their primary use isn't talking anymore. In the second quarter of this year, Americans sent more text messages on cellphones than they made calls. That ubiquity is creating a new challenge for the industry: how to keep growing when nearly everyone who wants a cellphone has one and the price of service plans is steadily declining. Carriers are pushing more e-mail and Internet services, giving handset makers more leeway to create multiuse devices such as the iPhone and upgrading their networks to handle all the traffic.