Cellular without the static.(cell phone service plans)(Buyers Guide)(Industry Overview)

One day last July, someone somewhere in America walked into a storefront, clicked on a mouse, or dialed a toll-free number and signed up for cell-phone service. This unheralded event marked an impressive milestone: In just a decade, the cellular industry had recruited its one hundred millionth customer.

What accounts for this burgeoning success? Clearly, service providers have sold peripatetic consumers on the dial-anywhere convenience of wireless telephony. Industry leaders--including familiar names like AT&T Wireless and Sprint PCS, as well as newly merged entities like Verizon Wireless (created out of Bell Atlantic, GTE, and others) and Cingular Wireless (comprising mainly BellSouth and SBC Wireless)--have stitched together nationwide networks.

Meanwhile, cell-phone manufacturers--chiefly, Audiovox, Ericsson, Kyocera (formerly Qualcomm), Motorola, Nokia, and Samsung--are churning out sleeker, less-expensive digital handsets equipped with longer-lived batteries and a full complement of conveniences, such as voice-activated dialing, plentiful memory for frequently called numbers, caller ID, and voice mail. The newest models now come packed with high-tech options like instant messaging, e-mail access, and simple web browsing.

Yet despite this undeniable progress, problems that have plagued the industry from its infancy continue to burden consumers with inflated costs and frequent and frustrating service breakdowns. In selecting a service plan, for example, you still must navigate a maze of widely varying charges for calls made during "peak" and "off-peak" minutes, while "roaming" outside of your home area, and when dialing long distance. Maps that purport to show where service is available often fail to disclose "dead" spots where calls can be blocked and pockets where towers that carry cellular signals are scarce. And handset technologies that may operate on two frequency bands and in any of four incompatible digital formats further cloud consumers' choices. Change carriers and chances are good that you'll have to toss away your handset and give up your phone number, to boot.

In short, what appears to be missing from the wireless industry's successful formula is a key ingredient--reliable basic service that's easy to understand.

This was borne out in a survey we conducted last fall of a nationally representative sample of 1,541 cell-phone users. We found that only about half of the respondents were completely satisfied or very satisfied with their cell-phone plan--among the lower satisfaction scores for consumer services we track--comparable to satisfaction levels for trial lawyers and airlines. One respondent in eight was dissatisfied with his or her current carrier. Investigations by state attorneys general and class-action lawsuits alleging pricing irregularities, misleading claims about coverage, or unreliable service against AT&T Wireless, Sprint PCS, and U.S. Cellular, among others, are under way or have recently been settled.

Whether you're new to the ranks of cellphone users or are a veteran of the wireless wars wondering whether it's time to upgrade, this report can help you make sense of the choices. We'll explain how to select a service plan that fits your needs and budget. ("A Sampler of Plans," the table on page 15, compares offerings suited to most nonbusiness wireless users from the major national and regional carriers.) In the section "All About Handsets," on page 16, we report on the evolving technology, present our test findings of 13 widely available cell phones, and explain how to select models based on features that matter most--how easy it is to make and receive calls, and how clear those calls sound.