25 Years of Tech: From Cellphones to Smartphones

While nearly every wireless plan is now unlimited, that was not the case back in 1993. Twenty-five years ago phone companies charged for minutes, text messages, and any data used. Now, unlimited is the norm and phones have become a key way for people to access the internet.

In this segment from Industry Focus: Tech, host Dylan Lewis is joined by Fool.com contributor Daniel Kline to discuss the shift in how people use phones and the move away from computers. They also talk about just how many Americans have a smartphone and how it has changed the way many people live.

A full transcript follows the video.

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This video was recorded on June 29, 2018.

Dylan Lewis: I think one of the other big changes that comes with this is how people are accessing the internet. I mentioned that computer stat before. In '93 -- this actually was surprisingly high for me -- 10% of Americans had a cellphone. That was higher than I would have expected. I guess you have to remember, though, those phones had pretty limited functionality, and they were basically the size of a brick.

Dan Kline: When they say 10% had a cellphone, a lot of those cellphones were built into cars. You used them to tell your family you had an accident. I got a cellphone maybe in '95, '96, and it was $60 a month, and that got me 20 minutes. It was a crazy amount of money to be able to do anything on your phone.

Lewis: That makes your current wireless plan look pretty good, Dan.

Kline: I think that's been the seismic change about how people access information. Really in the last two years, we've moved into a world where pretty much every wireless plan is unlimited. You no longer have to count -- do you remember when you had to count text messages? Was that ever a thing for you?

Lewis: [laughs] Yeah, I do. I remember being charged per text message, and my mom being furious with me.

Kline: For a very long time, my wife and son and I had different data plans. I would have ten gigs, and they would each have one, and we'd have to track it. Now, they still don't use that much data, but there's no reason to not have unlimited.

Lewis: Yeah, it just makes too much sense. Really, you see a lot of people using mobile devices instead of using laptops or desktops for a lot of the traffic that they would be doing. The major internet companies now see most of their traffic and most of their revenue coming from mobile. You look at Facebook, you look at Alphabet, that's certainly the case.

Kline: I believe the number was 87%, maybe it's even higher now, have a smartphone. The sheer amount of people that aren't turning to a computer -- I even look at older generations. My mother has a computer, but I'd say 98% of her internet access is on an iPad. It's really shifted from the days of being rooted to a computer. I'm still primarily a computer guy. We work on computers all day, so we have them in our hands, maybe, more than other people do.

Lewis: Yeah, I have friends that have totally ditched computers, aside from their work computer. They just have a smartphone or a phablet-style device that they use for everything in their personal life, which blows my mind. I can't believe that people do that, but they do. You go from this period where less than half of households had a computer to, most people in the United States have a computer in their pocket. That's a really big shift in consumer trends and access to information.

Kline: And it really took a while to take hold. You had the early generation smartphones, which were the BlackBerry style, they had a keyboard, they didn't really have apps. They couldn't do that much other than, it was really easy to type email and text messages. Then, you had the failed experiment -- I had an Apple Newton, which was the precursor to the iPad and the iPhone in a lot of ways. In 2007, the iPhone is what created what we have now, with this explosion of apps and the ability to do computer-like things on your phone. It was sort of inconceivable that you would create Excel documents on an old BlackBerry. That's maybe not pleasant to do on an iPhone, but certainly possible.

Lewis: Yeah. It has transformed the way that people can interact with software, and that larger installed base of smartphone users has led to these really rich app communities, and developers deciding to create all these things for mobile.

Kline: It's also changed how we live. Obviously, you weren't working back in the mid to late-90s. In 1999, I worked at [...], a top 25 website. We will probably refer to them more than once today. We had to have people that were on call, and we assigned them a phone, because they might have their own smartphone, they probably all had their own cellphone of some sort, but it didn't necessarily have reliable service. Now, because we all have smartphones in our pocket, do you ever feel like you're off?

Lewis: No, I'm always working. [laughs] Some of that's the nature of the work we do. It's media, there's stuff going on on Twitter. We like to stay tuned in. But, some of that, it's hard to put it down.

Kline: It is. The reality is, if you have a question about a story of mine, and I'm standing in line at Disney World -- I live in South Florida -- and I don't answer you until after the ride, no one is going to get hurt. We're not covering politics, we're not covering breaking news, for the most part. But the fundamental change is, because you can, you feel like you have to. That's a big change. I guess it works sometimes. Sometimes it's a real benefit, because you can clear up, with ten seconds of interaction, something that might take 20 minutes if you had to research it on your own. On the other hand, it does mean it's very hard to disconnect.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Daniel B. Kline owns shares of AAPL and FB. Dylan Lewis owns shares of GOOGL, AAPL, FB, and DIS. The Motley Fool owns shares of and recommends GOOGL, GOOG, AAPL, FB, TWTR, and DIS. The Motley Fool has the following options: long January 2020 $150 calls on AAPL and short January 2020 $155 calls on AAPL. The Motley Fool has a disclosure policy.