NEC of Japan Is Exiting Market for Smartphones

The retreat in the face of competition from an American and a South Korean company highlighted the country’s shift from electronics industry leader to laggard over the course of the last decade.

“We were late to enter the smartphone market, and we were unable to develop attractive products,” Isamu Kawashima, the chief financial officer of NEC, said at a news conference here. “That’s what it comes down to.”

Like other Japanese phone makers, NEC clung to old-fashioned flip phones — great for making phone calls, taking pictures or playing simple games, but not for much else — as rivals elsewhere were developing smartphones that put the entire Internet and more in users’ pockets. The first NEC smartphone did not appear until 2011, four years after Apple’s iPhone.

The strategic failure left NEC with hundreds of millions of dollars in losses as its share of the Japanese cellphone market slipped into the single digits. It also landed yet another blow to corporate Japan’s once vaunted reputation for innovation.

“NEC was like the face of the Japanese phone industry,” said Nobuyuki Hayashi, a technology consultant and writer. “Losing them will be very upsetting for those who take pride in Japanese manufacturing.”

NEC’s surrender is the latest consolidation in the country’s cellphone industry. In 2010, NEC absorbed the remnants of the mobile phone divisions of two other Japanese stalwarts, Casio and Hitachi, with NEC holding a controlling stake. In 2008, Kyocera acquired the phone-making arm of Sanyo. In 2010, Fujitsu and Toshiba combined their handset businesses; Fujitsu bought out its partner last year. Mitsubishi, another big electronics company, got out of the phone business entirely.

Analysts say NEC and other Japanese cellphone makers were tied too closely to Japanese network operators, developing what has come to be known in that country as a “Galápagos” effect; devices were cut off from the evolution of the phone business elsewhere. As a result, the makers failed to grasp the significance of the rise of the smartphone.

As Japanese consumers embraced the smartphone in a big way, the companies had nothing to offer. Although flip phones from NEC and other Japanese makers are still in wide use in the country, smartphones now make up a majority of new sales. Japanese brands struggle to compete with imported smartphones, especially the iPhone.

“As the market for mobile phone handsets, including the rapid spread of smartphones, has dramatically changed, economies of scale have become increasingly important for the maintenance and strengthening of competitiveness,” NEC said in a frank statement. “However, NEC’s mobile phone handset shipments are following a downward trend, and it is difficult to foresee improved performance in the future.”

By last year, Apple had become the market leader in Japan, where the iPhone had won 25.5 percent of overall cellphone sales, according to the MM Research Institute. Even Samsung, which has been slower to establish a foothold in Japan than elsewhere, surpassed NEC last year, with a 7.2 percent market share.

In smartphones, Apple is even more dominant, with 40 percent of the Japanese market in the first quarter, according to another research firm, IDC.

“There will be further consolidation in the industry,” said Jean-Philippe Biragnet, a partner at the Bain & Company consulting firm in Tokyo. “There is not space for more than two or three of these players. The question is, Who?”

Among the domestic brands, the leaders last year, according to MM, were Fujitsu, with a 14.4 percent share of the overall mobile phone market; Sharp, with 14 percent; and Sony, with 9.8 percent.

Panasonic and Kyocera are much weaker, though they were slightly ahead of NEC, whose share of the business had fallen to about 5 percent last year from nearly 28 percent in 2001, according to MM.

Among the remaining contenders, only Sony has a significant presence outside Japan. The other Japanese phone makers have been outflanked at the high end of the smartphone business by Apple, Samsung and others, and at the low end by a growing number of Chinese manufacturers.

NEC was in talks with one of the Chinese companies, Lenovo, about a partnership aimed at saving the smartphone business, but the negotiations broke down several weeks ago, making the company’s announcement Wednesday inevitable, analysts said.

For fans of retro-styled Japanese flip phones, which have come to be known here as “gara-kei,” short for “Galápagos phone,” there was at least one saving grace in NEC’s announcement. The company said that even though it was quitting the smartphone business, it would continue “developing and producing conventional mobile handsets.”

Joshua Hunt contributed reporting.

Where Car Is King, Smartphones May Cut Traffic

But now licensed cabdrivers in this city where the car remains king are facing their greatest competition in half a century, from new ride-sharing programs that use smartphone apps to connect drivers and passengers.

At the end of a night of drinking recently, rather than hailing a cab, Trisha DiFazio tapped an app called Lyft on her phone to summon a ride. Minutes later, a graduate student moonlighting as a driver pulled up in a Toyota S.U.V. with Lyft’s signature pink mustache affixed to its grille.

“This is so much cheaper than a cab, and so much easier,” said Ms. DiFazio, 31. “I absolutely think my friends drink and drive less because of this.”

Transit experts say these new services, which appeal to younger riders, could play a crucial role in ending the reign of single-occupant cars (and unending traffic) in Los Angeles, and many young residents have embraced them as a cheaper, more reliable and, well, more fun way to get around the city. But some of the city’s licensed cabdrivers have another name for ride-sharing services: illegal bandit taxis.

Last month, city regulators sided with the cab companies and sent cease-and-desist orders to Lyft and two other companies offering ride-sharing services, Uber and Sidecar, ordering them to shut down immediately. “It’s the Wild West with these operators,” said Tom Drischler, the taxicab administrator for the city’s Department of Transportation. “You have folks driving private cars and picking up strangers. Public safety is our assignment, and I don’t think it’s safe for the public.”

All three companies have refused to leave town, asserting that agreements they made with state regulators allow them to operate anywhere in the state.

Smartphone-based ride-hailing services have faced opposition from taxi companies and city regulators almost everywhere they have appeared, from Las Vegas to Cambridge, Mass. But the fight here is complicated by longstanding efforts by city officials to alleviate traffic and reduce drunken driving.

Last week, on his first full day in office as the new mayor of Los Angeles, Eric Garcetti proudly proclaimed that Los Angeles was beginning to leave behind its culture of car ownership. And Juan Matute, director of the Local Climate Change Initiative at the University of California, Los Angeles, said that if more people used ride-sharing services — even just 3 percent of the population, he said — substantial reductions in driving in Los Angeles could result.

“It would be easier to share rides that are incidental to daily life,” he said.

Unlike the new companies, the taxi industry here, which pays about $4 million a year to the city in franchise fees and vehicle permits, is tightly regulated for safety.

In addition to franchise and inspection fees, regulated taxis have to serve far-flung and low-income parts of the city where Lyft drivers need not venture. The city also requires cab companies to offer disabled-accessible vehicles, which William Rouse, the general manager of Los Angeles Yellow Cab, said his company did at a loss. “If they’re going to skirt our entire cost structure,” he said, “then they’re going to be able to get away with charging less and still make a profit.”

Rather than a metered fare, Lyft has a suggested donation, typically about 20 percent cheaper than a cab. Riders can pay as much or as little as they like, although those who frequently shortchange drivers have a tough time getting rides.

Jano Youssefi, an Iranian immigrant who has driven cabs in Los Angeles for 15 years, said his income had dropped at least 20 percent in the six months since Lyft rolled into town. “We are not making money anymore,” Mr. Youssefi said.

Yet, even as the threat of arrest hangs over drivers — some Lyft drivers removed the pink mustaches from their grilles after the cease-and-desist order — interest in the new programs seems to be on the increase. Drivers for Lyft and Sidecar use their own cars, and typically keep about 80 percent of the payments passengers offer, while the company keeps the rest. Uber also offers a service that connects passengers with licensed, professional luxury car drivers, as well as people driving their own cars.

Justin Riley, who began driving for Lyft a month ago, said he enjoyed the flexible hours, which gave him time to work on getting his tech start-up company off the ground. “It’s allowed me to discover L.A.,” he said. “I’ve met so many diverse people, heard so many great stories.”

But Mr. Drischler, the city taxicab administrator, said the collegial environment was part of the problem. Before safety partitions were installed in cabs two decades ago, he said, one cabdriver was killed every 18 months in Los Angeles. “I’m honestly worried for the drivers of those companies,” he said. “I have two daughters in their 20s, and I would never let them drive for those companies.”

The California Public Utilities Commission is writing rules for smartphone ride-hailing services.

France Urged to Impose Tax on Smartphones and Tablets

PARIS — France’s “cultural exception” — the policy that creative works like books, music and movies deserve protection beyond what is accorded ordinary goods — is in line for a digital update.

A government adviser has suggested that manufacturers pay a 1 percent levy on the price of smartphones and tablet computers to help keep funding for such works alive, as more and more end up online and beyond the reach of existing taxes.

The tax, “painless for the consumer,” could also be used to ensure that artists are remunerated at a time when so much is downloaded free, said the report, which was presented Monday to President François Hollande and his culture minister, Aurélie Filippetti.

“Considering the weight of cultural content in connected devices, it is legitimate that those who make and distribute the equipment contribute to the financing of its creation,” according to the report, produced under the guidance of a former television executive and journalist, Pierre Lescure.

“L’exception culturelle” is no trifling matter: Nicole Bricq, the French trade minister, warned in March that it was “a red line” that could not be crossed in talks with the United States on a proposed free-trade area. France and 13 other European Union member nations insisted in a letter this week that the audiovisual sector must be left out of those talks, setting up a possible confrontation with the British prime minister, David Cameron, who has said that everything should be on the table.

In practice, the cultural exception means broadcasters must meet quotas for French music and television programming, for example, and prices for books are set by regulators. The effort stretches throughout the economy, requiring a system of taxes and subsidies for its upkeep, perhaps most visibly in the country’s film industry, which gets hundreds of million euros each year in subsidies — raised from taxes on movie tickets, television stations and Internet service providers — to defend itself from the Hollywood juggernaut.

But technology threatens to render such measures irrelevant, the report noted. The nature of Internet commerce means foreigners can have access to the French market without having to pay the levies that support French culture. And as more content is streamed online or stored in the cloud, a tax on recording media like blank compact discs and memory sticks will raise less money — and that is where the smartphone tax comes in.

Gilles Vercken, an intellectual property lawyer, acknowledged that streaming and the cloud would bring down those levies, which he estimated currently raise about €200 million, or $260 million, a year to support French authors, composers, actors, musicians and the like. But he expressed skepticism that the smartphone tax would see the light of day.

“I wonder what could be the legal grounds for such taxes,” he said, noting that the connection between hardware manufacturers and end users might prove a difficult one to defend in court. “I really don’t see it.”

Monica Horten, a visiting fellow at the London School of Economics who studies the politics of intellectual property rights, said that, in principle, such levies were possible under E.U. law, but that “the problem is in the implementation.”

The first issue would be drafting a law acceptable to the European Court of Justice, while another would be in actually getting device makers on board to pay the tax. “I think you can expect them to filibuster,” she said.

The report seeks to address a problem that is as old as the Internet, which has shifted the balance of power away from content creators in favor of newer actors like Google, Amazon and peer-to-peer downloading services, even as it gives creators previously unimagined opportunities to be seen or heard.

In addressing such matters, France has sometimes chosen to fight battles that other governments have shied away from. For instance, Google agreed in February to set up a €60 million fund to help French newspaper and magazine publishers develop their digital business, though it managed to fend off demands that it pay for the right to link to their content.

And the Lescure report comes less than two weeks after Arnaud Montebourg, the minister for industrial renewal, put the kibosh on a sale to Yahoo of a majority stake in Dailymotion, a French rival to YouTube, because the government had singled out the company as a national champion and did not want control falling into foreign hands.

The Lescure report also suggests that France throw out a “three-strikes” anti-piracy law that Nicolas Sarkozy, Mr. Hollande’s predecessor, had held up as one of his signature achievements and one that had been hailed by the global entertainment industry. Under the Hadopi Law, as it is known, illegal downloaders were to have their Internet access cut off if they failed to heed three warnings; violators were also to be subject to criminal sanctions and large fines. In practice, there has been little enforcement action, though proponents credit the law with helping to reduce Internet piracy.

If Mr. Lescure’s recommendations are followed, law enforcement will focus on the worst violators, and most people would face minimal fines. A proposed “Hadopi authority” would be eliminated, and responsibility for enforcement would revert to the national media regulator, the Conseil supérieur de l’audiovisuel.

Bits Blog: Smartphones Finally Surpass the Feature Phone

Jason Lee/Reuters A new report says that more than half of cellphone shipments in the first quarter were smartphones.

It’s finally time for the old-school clamshell cellphone to step aside and make way for the smartphone, which is now the most popular type of phone in the world.

IDC, the research firm, issued a report Thursday night that found that more than half of cellphone shipments in the first quarter were smartphones. Manufacturers shipped 418.6 million cellphones, 216.2 million of which were smartphones, says IDC.

Samsung, the top maker of smartphones, shipped 70.7 million, commanding 32.7 percent of the market in the first quarter. Apple was in second place with 37.4 million iPhones sold and 17.3 percent of the market. LG was in a distant third with 10.3 million smartphones, for 4.8 percent of the market.

Now that most people are buying smartphones, manufacturers may begin aiming at the few markets where the old-school feature phone is still prominent. A recent study by Nielsen suggests that the feature phone is still selling strong in India, Brazil and Russia. Apple has been rumored to be working on a lower-cost iPhone to aim at foreign markets, namely China.

App Smart: Dictionary Apps for Smartphones and Tablets

But before your fingers close on that printed book and flick through its alphabetically indexed pages, consider this: There are many dictionary apps that could help you do the job more speedily. They may also have features that will teach you new words. And they might even be fun.

Dictionary.com Dictionary and Thesaurus is a free iOS and Android app that comes from one of the best-known dictionary Web sites. Unlike the Web site, the app has the advantage that many of its features work offline. This app’s home page is colorful with icons and is topped by a search bar where you enter words you want to look up. As soon as you begin to type in this bar, the app begins to suggest words that may match, so you don’t always have to type in the whole word. If you’re unsure of a word’s spelling, you can tap on the microphone icon and speak your word instead.

When you see the word you’re looking for in the search list, a single tap takes you to its main dictionary entry. Here you’ll find the usual definitions you’d get in a paper dictionary, including a guide to pronunciation, word origin description, various meanings and related word forms. You can hear the word spoken aloud by tapping on the loudspeaker icon, or add the word to a favorites list. The app also has a built-in thesaurus, which you can get to via a tab in the search bar. On the iPhone, the app can translate a word into several languages.

It’s functional as a dictionary, but the app also has entertaining extras. It can show you which words people are searching for most right now, for example, and even what people near you are searching for.

The app is visually cluttered, though, and some features, like voice recognition and pronunciation guides, work only online. I got the feeling I was being nagged to buy add-ons, like the ability to see example sentences. Also, the free version’s on-screen ads can get annoying if you don’t make a $2.99 in-app purchase to banish them.

The Android version has a slightly different interface of a simpler design than the iOS version. There is also an attractively designed free edition for Windows Phone, though it seems trickier to switch between the dictionary and the thesaurus in that one.

Merriam-Webster has released several dictionary apps with different functions to cater to certain users or devices. For example, some apps incorporate a thesaurus function alongside the main dictionary; others don’t. The basic Merriam-Webster app is free for iOS and Android devices and is supported by on-screen ads. Its design is simpler than the Dictionary.com app’s. The home page consists of a logo, a control bar at the bottom that provides access to the app’s various functions and a prominent search bar at the top.

Like the Dictionary.com app, Merriam-Webster’s version suggests word matches as you type in the search bar. It can also take voice input instead of typed text. When you tap on a word in the list of suggestions, the app shows the relevant dictionary entry, which is easy to read, with a clear layout and large text. The entry also uses the word in an example and offers a list of synonyms and antonyms. Tap on the red speaker icons to hear the word pronounced.

But the basic app’s database is limited and it knows only two of my favorite three words. It’s possible that the Collegiate edition would know all three: it costs a little less than $25 on iOS and Android to get more definitions as well as the ability to modify menus and a “pen reader” system for recognizing handwriting in many languages. A $3.99 Windows Phone edition of the Merriam-Webster app says it includes “all” the definitions from the Collegiate dictionary.

English Dictionary — Offline, free on Android, is the simplest of the apps mentioned here but is still powerful. Its interface is basic: a search box at the top and space below for word definitions to appear. Tap icons to share words to other apps, flag words as favorites or perform other actions like viewing your search history. Dictionary entries are based on the Wiktionary database, which the makers say includes about 159,000 words. You can click on individual words on an entry page to navigate to that word, and the app will speak the word aloud for you. It’s free and handy for looking up definitions. But it falls short if you’re curious about how a word came into use.

As for “philtrum,” it’s that little vertical groove in your upper lip beneath your nose.

Quick Call

Microsoft has updated its Outlook.com e-mail app for Android, bringing the new design of the desktop Outlook software to the app and adding services like threaded conversations and the ability to mark messages as junk.

Strong Quarter for Smartphones Bolsters AT&T

AT&T, based in Dallas, said it sold six million smartphones, the most it has ever sold during a first quarter, typically a slow season for the phone business. It also made more money from mobile data, in the fees people pay to use the Internet with its network, to $5.1 billion, up 21 percent from the same quarter last year. And it added 731,000 U-verse high-speed Internet subscribers and 232,000 TV subscribers, the most additions for its broadband service in eight quarters.

Randall L. Stephenson, AT&T’s chairman and chief executive, said in a statement that the company’s wireless network performance “helped drive our best-ever first quarter for smartphone sales, improved wireless churn and strong growth in mobile data revenues.”

The company said it added 296,000 contract subscribers, up from 187,000 subscribers last year. But this subscription number includes new iPad customers, which carriers typically do not include when counting subscriber additions, meaning phone subscriber growth may be much lower than it sounds.

Jan Dawson, a telecom analyst at Ovum, the research firm, said AT&T was most likely trying to push investors to think about overall subscriber numbers because much of its growth would be coming from newer devices like tablets, not from phones.

AT&T reported on Tuesday that net income in the first quarter grew 3.2 percent, to $3.7 billion, or 67 cents a share, compared with $3.6 billion from the same quarter a year earlier. The company attributed the increase to especially strong sales of smartphones and major growth in its paid-television and high-speed Internet service, U-verse.

Its revenue fell 1.5 percent, to $31.4 billion.

The net income was above the expectations of Wall Street analysts, who had expected 64 cents a share on revenue of $31.7 billion, according to a survey of analysts by FactSet.

AT&T and its rival Verizon Wireless dominate the American phone market, counting two-thirds of wireless subscribers. But now that most people who want a cellphone already own one, the carriers are adding fewer new subscribers.

AT&T’s subscription growth is much slower than that of Verizon Wireless. Verizon added 677,000 contract subscribers in the first quarter, up 35 percent from last year. Analysts say that even though Verizon’s phone plans tend to be the most expensive, the carrier is attracting customers with its superior network coverage.

In a race to attract the few potential wireless subscribers who remain, American carriers are building out a fourth-generation network, LTE, which is faster and more efficient than its predecessor, 3G. Verizon is in the lead with LTE deployed in about 500 markets; AT&T is in a distant second with LTE covering 185 markets.

John J. Stephens, the company’s chief financial officer, said that as AT&T expanded its LTE network further, there would be new opportunities to make more money.

“As we continue to complete our LTE deployment we will continue to see growth in other services,” he said. “That should provide us with future growth opportunities.”

To tap into new sources of revenue, AT&T is offering other wireless services. The company this year introduced Digital Life, its connected home security system. The system, which will be released this quarter, allows homeowners to connect appliances to the Internet, like lamps and surveillance cameras, and remotely control them with an AT&T smartphone app. Customers can also use the service to monitor homes from afar by receiving a text message if someone trips a motion sensor, for example.

AT&T is also expanding into cars. In February, it announced a partnership with General Motors to add wireless service to most Chevrolet, Buick, GMC and Cadillac vehicles in the United States and Canada by 2014.

This article has been revised to reflect the following correction:

Correction: April 23, 2013

An earlier version of this article misstated a number of figures in AT&T’s earnings report. AT&T’s net income grew 3.2 percent, not 5.2 percent. Its revenue fell 1.5 percent to $31.4 billion, it did not rise 1.8 percent to $31.8 billion. Its U-verse subscriber numbers rose by nearly a million, not 2.5 million. And it added 296,000 wireless contract subscribers, up from 187,000 subscribers last year, not up from 186,000.

Inside Asia: Smartphones Gain Ground in India

More than four years after it started selling iPhones in India, Apple is aggressively pushing the devices with installment payment plans that make it more affordable, a new distribution model and a marketing blitz.

“Now your dream phone” at 5,056 rupees, or $94, read a recent full front-page ad for the iPhone 5 in the Times of India, referring to the initial payment on a phone priced at about 45,500 rupees, or almost two months’ wages for an entry-level software engineer.

The newfound interest in India suggests a subtle strategy shift for Apple, which has moved tentatively in emerging markets and has allowed rivals like BlackBerry and Samsung Electronics to dominate with more affordable smartphones. With the exception of China, all Apple stores are in advanced economies.

Apple expanded its Indian sales effort in the second half of 2012 by adding two distributors. Previously it had sold iPhones only through a few carriers and stores it calls premium resellers.

The result: Shipments of iPhones to India between October and December nearly tripled to 250,000 units, from 90,000 in the previous quarter, according to an estimate by Jessica Kwee, a Singapore-based analyst at the consulting firm Canalys.

At the MobileStore, an Indian chain owned by the Essar conglomerate, which says it sells 15 percent of the iPhones purchased in the country, iPhone sales tripled between December and January, thanks to a monthly payment program introduced last month.

“Most people in India can’t afford a dollar-priced phone when the salaries in India are rupee salaries,” said Himanshu Chakrawarti, the MobileStore’s chief executive. “But the desire is the same.”

Apple, its distributors, its retailers and banks share the advertising and interest costs of the marketing push, according to Mr. Chakrawarti. Carriers like Bharti Airtel, which also sell the iPhone 5, run separate ads.

India is the world’s second-largest cellphone market by number of users, but most Indians cannot afford fancy handsets. Smartphones account for just a tenth of total phone sales. In India, 95 percent of cellphone users have prepaid accounts without fixed contracts. Unlike those in the United States, Indian carriers do not subsidize handsets.

Within the smartphone segment, Apple’s Indian market share last quarter was just 5 percent, according to Canalys, meaning its overall penetration is tiny.

Still, the industry research company IDC expects the Indian smartphone market to grow more than five times, to 108 million units in 2016, from about 19 million last year, which presents a big opportunity.

Samsung Electronics dominates Indian smartphone sales with a 40 percent share, thanks to its wide portfolio of Android devices, priced as low as 5,900 rupees. The market has also been flooded with lower-cost Android phones from local brands like Lava and Micromax.

Most smartphones sold in India are much cheaper than the iPhone, said Anshul Gupta, a Gartner analyst: “Where the masses are — there, Apple still has a gap.”

Apple helped create the smartphone industry with the iPhone in 2007, but last year it lost its lead globally to Samsung, whose free Android software is especially attractive in Asia. Many in Silicon Valley and on Wall Street believe the surest way to penetrate lower-income Asian markets would be with a lower-cost iPhone, as has been widely reported but never confirmed. The risk is that a lower-cost iPhone would reduce demand for the premium version and eat into Apple’s margins.

The new monthly payment plan in India goes a long way toward expanding the potential market, Mr. Chakrawarti said.

“The Apple campaign is not meant for, really, the regular top-end customer; it is meant to upgrade the 10,000-12,000 handset guy to 45,000 rupees,” he said.

Apple’s main focus for expansion in Asia has been Greater China, including Hong Kong, mainland China and Taiwan, where revenue grew 60 percent last quarter to $7.3 billion.

Asked last year why Apple had not been as successful in India, Timothy D. Cook, the company’s chief executive, said that its business in India was growing but that the company remained more focused on other markets.

“I love India, but I believe that Apple has some higher potential in the intermediate term in some other countries,” Mr. Cook said. “The multilayer distribution there really adds to the cost of getting products to market.”

Apple, which has partly addressed that situation by adding distributors, did not respond to an e-mail seeking comment.

Ingram Micro, one of its new distributors, also declined to comment. Executives at Redington, the other distributor, could not immediately be reached.

BlackBerry, which has seen its global market share shrivel to 3.4 percent from 20 percent over the past three years, is making what is seen as a last-ditch effort to save itself with the BB10 series.

The high-end BlackBerry Z10, introduced in India on Monday, is expected to be priced not far from the 45,500-rupee price tag for an iPhone 5 with 16 gigabytes of memory. The Samsung Galaxy S3 and Galaxy Note 2, the Nokia Lumia 920 and two HTC models are the main iPhone rivals.

Until last year, BlackBerry had a market share of more than 10 percent in India, thanks to a push into the consumer segment with lower-priced phones. Last quarter, its share fell to about 5 percent, according to Canalys, just ahead of Apple.

Some Companies Seek to Wean Employees From Their Smartphones

Atos, an international information technology company, plans to phase out all e-mails among employees by the end of 2013 and rely instead on other forms of communication. And starting in the new year, employees at Daimler, the German automaker, can have incoming e-mail automatically deleted during vacations so they do not return to a flooded in-box. An automatic message tells the sender which person is temporarily dealing with the employee’s e-mail.

No one is expected to be on call at all hours of the day and night, and “switching off” after work is important, “even if you are on a business trip,” said Sabrina Schrimpf, a Daimler spokeswoman, referring to the company’s recently released report, “Balanced! — Reconciling Employees’ Work and Private Lives.”

Disconnecting can be more challenging for business travelers who frequently work across time zones.

And there is a ripple effect, said Leslie A. Perlow, a professor of leadership at Harvard Business School and the author of “Sleeping With Your Smartphone.” “These guys fly in the middle of the night and send e-mails back to colleagues” who wait up, ready to respond.

A study conducted last spring by the Pew Research Center’s Internet and American Life Project found that while mobile phones were valued as a way to stay productive, there were downsides to being available at all times. The nationwide survey of 2,254 adults found that 44 percent of cellphone owners had slept with their phone next to their bed and that 67 percent had experienced “phantom rings,” checking their phone even when it was not ringing or vibrating. Still, the proportion of cellphone owners who said they “could live without it” has gone up, to 37 percent from 29 percent in 2006.

Sam Chapman, chief executive of Empower Public Relations in Chicago, said he used to feel phantom vibrations and frequently read and sent e-mail on his BlackBerry in the middle of the night. He slept poorly, did not feel refreshed in the morning and considered himself addicted. “I wanted to make sure that what happened to me didn’t happen to my employees,” he said.

So Mr. Chapman adopted what he called a BlackBerry blackout policy. He and his staff of about 20 turn off their BlackBerrys from 6 p.m. to 6 a.m. on weekdays and completely on weekends for all work-related use, with rare exceptions. “When I’m well rested, I show up to work ready to go,” he said.

He maintains that regimen while traveling, and said the policy had increased company productivity.

Professor Perlow agreed that companies could improve their bottom line by encouraging employees to disconnect at times. “Being constantly on actually undermines productivity,” she said.

But it is not always easy. In early 2012, when Michelle Barry, Mark Jacobsen and a third partner created Centric Brand Anthropology, a Seattle-based company that advises clients on brand strategy, design and culture management, they gave serious thought to the issue.

“A huge priority for us was to have a good balance between work-life,” said Mr. Jacobsen, Centric’s vice president and creative director. “Yet we have found that very difficult to do while working with large multinational clients,” which often require international travel and constant availability.

Being a start-up compounded those challenges. “Just because you can e-mail at 2 a.m., doesn’t mean it’s a good thing,” he said.

Centric encourages employees to prepare a week before a trip, designating a colleague as backup, informing clients about their travel plans, and trying to avoid deadlines immediately after they return. Employees are also encouraged to take spouses or partners on longer assignments and to build in downtime, said Ms. Barry, the company’s president and chief executive. When traveling, she said, “I make a commitment to myself not to stay up all night answering e-mails.”

Experts say there is no firm data for how many companies have policies restricting the use of electronic devices outside the office. “The companies I know actively encourage workers to stay connected after hours and on weekends,” said Dennis J. Garritan, a managing partner of the private equity firm Palmer Hill Capital and an adjunct professor at Harvard Business School.

Mobile Video Calling Spreads as Smartphones and Tablets Improve

PALO ALTO, Calif. — The next competition in technology is your face — anywhere, anytime.

As the cameras and screens of smartphones and tablets improve, and as wireless networks offer higher bandwidth, more companies are getting into the business of enabling mobile video calls.

The details vary from one service to the next, but the experiences are similar: from anywhere in the world with a modern wireless network, a smartphone’s screen fills with the face of a friend or relative. The quality is about the same jerky-but-functional level as most desktop video. Sound is not always perfectly synced with the image, but it is very close. The calls start and end the same way, by pressing a button on the screen.

Mobile video calling has risen so quickly that industry analysts have not yet compiled exact numbers. But along the way, it is creating new business models, new stresses on mobile networks and even new rules of etiquette.

“All the communications — social messages, calls, texts and video — are merging fast,” said Eric Setton, co-founder and chief technology officer of Tango Mobile, whose free video calling service has 80 million active users. An additional 200,000 join daily, Mr. Setton said.

Once an interesting endeavor for a few start-ups like Tango, mobile video has caught the attention of big companies. Apple created FaceTime and made it a selling point for the iPad.

In September, the company made FaceTime available on cellular networks instead of limiting it to Wi-Fi systems, almost certainly in response to increasing consumer demand.

Last week, Yahoo purchased a video chat company called OnTheAir. And in 2011, Microsoft paid $8.5 billion for Skype, a service for both video and audio-only calls. Though most people use Skype on desktop and laptop computers, the software for the service has been downloaded more than 100 million times just by owners of phones running Google’s Android mobile operating system. Microsoft built a service for its Windows 8 mobile phone that lets people receive calls even when Skype is not on.

Google, which has more than 100 million people a month using its Google Plus social networking service, now offers more than 200 apps for its video calling feature. It says it is interested not in making money on the applications, but in learning more about them so it can sell more ads by getting people to use its free video service, called Hangouts. Hangouts can be used for two-person or group calls, or for a video conference with up to 10 people.

“On a high level, Google works better when we know who you are and what your interests are,” said Nikhyl Singhal, director of product management for Google’s real-time communications group. “Video calling is becoming a basic service across different fronts.” While Mr. Singhal is an occasional user, he said, his 4-year-old daughter “is on it every day.”

Don’t expect video calling to improve productivity. Tango uses the same technology that enables video calls to sell games that people can play simultaneously. It sells virtual decorations like balloons to drop around someone’s image during a birthday call (both parties see the festive pixels). Google says some jokey applications on Hangouts, like a feature that can put a mustache over each caller, seem to encourage people to talk longer.

Currently, popular two-way games like Words With Friends on Facebook work by one player making a move and then passing the game over to the other player, not watching moves as they are made. Another promising area is avatars, like cartoon dogs and cats, that mouth speech when a user wants to have a video call but does not want to be seen.

The prospect of having to appear on-screen at any given moment might sound like a nonstarter for people who worry about bad hair days. But in fact, using mobile devices for video calls may be less bother than it seems.

“There may be natural inhibitions to being seen, but when I’m on a mobile device I’m out and about, so I’m more likely to be presentable,” said Michael Gartenberg, a consumer technology analyst at Gartner. “How people use this remains to be seen, but they are starting to expect it.”

Yet a new etiquette for mobile video calls is already emerging. People often text each other first to see if it’s O.K. to appear on camera. Video messages sent in the text box of a phone, like snippets of a party or a child’s first steps, are also useful precursors to video conversations. Mr. Singhal said making avatars for users of Hangout would be “an extraordinarily important area” as well.

The greatest challenge for the business may not be getting more consumers to use the service, but making sure the service works. Most phones have slight variations in things like camera placement and video formatting from one model to the next. “A camera can show you upside down if you load the wrong software on it,” said Mr. Setton of Tango.

As a result, the 80 engineers among Tango’s 110 employees have adjusted their software to work on more than 1,000 types of phones worldwide. The top 20 models have more than a million customers each, but the complexity of building software for a wider range of phones has made it hard for new mobile video companies to enter the field, Mr. Setton said.

Tango’s average video call used to last six minutes, Mr. Setton said, but when the company started adding other applications to go with the videos, like games and designs that float over people, the average call length rose to 12 minutes.

Brian X. Chen contributed reporting.

Disruptions: Disruptions: How Smartphones Are Making Wallets Obsolete

Nick Bilton/The New York Times Nick Bilton discarded his wallet after realizing his smartphone had replaced almost everything in it.

Growing up, I noticed that something happened to my father as he aged: his wallet expanded with each passing year.

There were new credit cards, membership cards, coffee cards, business cards, pictures of his family, stamps and other plastic and paper things, added almost weekly. Eventually, his wallet grew so large that he would pull it out of his back pocket when he sat down, dropping it on the table like a brick.

As I’ve grown older, something entirely different has happened to my wallet: each year, it has become slimmer. Things that once belonged there have gradually been siphoned out by my smartphone. Last week, I realized I didn’t need to carry a wallet anymore. My smartphone had replaced almost everything in it.

So, it’s gone. Add that to the pile of things — my address books, Filofax, portable music player, point-and-shoot camera, printouts of maps — that have melded into the smartphone.

So where did the things that used to live in my wallet go?

Printed photos, which once came in “wallet size,” have been replaced by an endless roll of snapshots on my phone. Business cards, one of the more archaic forms of communication from the last few decades, now exist as digital rap sheets that can be shared with a click or a bump.

As for cash, I rarely touch the stuff anymore. Most of the time I pay for things — lunch, gas, clothes — with a single debit card. Increasingly, there are also opportunities to skip plastic cards. At Starbucks, I often pay with my smartphone using the official Starbucks app. Other cafes and small restaurants allow people to pay with Square. You simply say your name at a register and voilà, transaction complete.

But wait, what did I do with all of the other cardlike things, like my gym membership I.D., discount cards, insurance cards and coupons? I simply took digital pictures of them, which I keep in a photos folder on my smartphone that is easily accessible. Many stores have apps for their customer cards, and insurance companies have apps that substitute for paper identification.

Because I own an iPhone, I don’t have to carry tickets around, either. I use Passbook, a free Apple app that can store boarding passes, movie tickets, coupons and loyalty cards. I’ve used these digital replicas to board a flight to Los Angeles and to get into a movie and a baseball game.

Some people might cringe at the thought of putting a picture of an insurance card on their phone, but if I lose my phone, there is a password to stop someone from opening it. My wallet never came with a password.

There are a couple of things I still carry in my pocket, held together with a money clip: the debit card and my driver’s license. But I’m confident that those, too, will someday disappear.

Soon enough, my phone will become my sole credit card, and the only thing left in my pocket will be my driver’s license. And at some point, the government will enter the 21st century and offer a digital alternative for that.

Or maybe I won’t need a driver’s license at all: when cars drive themselves in the not-too-distant future, I’ll be taking a nap while my car takes me to work.

E-mail: bilton@nytimes.com

Tool Kit: Wi-Fi and Smartphones Make Homes a Little Smarter

I can understand the urge to skip this subject. Smart homes, also known as connected homes, networked homes and home automation, are the cold fusion of domestic technology: always promised, never delivered.

Well, some have tried to deliver, just not very well or very cheaply. My earliest memories of home automation probably go back to episodes of “Lifestyles of the Rich and Famous” and “Silver Spoons”; I watched different systems in a house come alive thanks to a wall-mounted control panel.

It was the stuff of fantasy, and it has remained that way for most people because traditional home automation relied on yards of wiring and insanely expensive installation costs.

But little by little, home automation has crept into our houses and apartments thanks to two things many homeowners already have — Wi-Fi networks and smartphones.

A home’s Wi-Fi network is the perfect low-cost, low-impact infrastructure for machines and devices to communicate with each other. And with a smartphone, you have the perfect wireless control panel that can work in your house or when you’re halfway around the world.

One of the best examples of this new approach is Nest Labs. This is a Silicon Valley start-up that has shaken up the otherwise sleepy thermostat industry by introducing a $250 device that not only uses motion detection to figure out when you’re in a room and predict when you’ll be out, but also gets on your home’s wireless network so you can use your smartphone as a remote control.

This is helpful when you don’t want to get up from the couch to turn the air-conditioning down, but even more so when you’re leaving work and want to adjust the temperature before you get home so things are appropriately cool or toasty when you walk through the front door.

For people who don’t have central HVAC systems, the air-conditioner manufacturer Friedrich has a line of window units called Kühl that, later this summer, will offer Wi-Fi capabilities. With a smartphone app, you’ll be able to control the units (which come in either AC-only or AC-and-heat combined versions) from wherever your phone has a data signal.

You know those timers that you plug into a wall outlet and then plug things like lamps into? Belkin is giving those devices an upgrade with its WeMo line of power accessories. The name is annoying, but the units themselves are pretty cool and simple to use.

You plug a WeMo unit into a wall outlet and then plug an electrical device (lamp, TV, stereo) into it. WeMo units are Wi-Fi enabled, and a smartphone app allows you to control when power is delivered to the device that’s plugged in.

In addition to manually turning on and off lamps and such, you can put WeMos on a schedule, just like the older timer units.

A $50 WeMo unit works with the smartphone app; a $100 version adds a motion detector so your television can turn off, for example, if everyone leaves the room.

Wireless data is making itself useful outside the home as well.

In olden times, lawn sprinkler systems were run on a schedule. The first big evolution was adding rain sensors, which could delay a scheduled watering if enough rain had just fallen. But that system remains only reactive, not predictive. Sprinkler controllers from HydroPoint, sold under the WeatherTrak brand (the WeatherTrak ET Plus starts at around $300), pull in local weather data from the National Oceanic and Atmospheric Administration to adjust watering schedules. So if a thunderstorm is headed your way, the system can automatically reschedule the sprinklers to prevent wasting water. A smartphone app allows manual override of the system.

Not all Wi-Fi-enabled machines make sense. Earlier this year, Samsung showed off its WF457 ($1,700) and DV457 ($1,700) washer and dryer, which can be controlled and monitored via a mobile app.

Tool Kit: Wi-Fi and Smartphones Make Homes a Little Smarter

I can understand the urge to skip this subject. Smart homes, also known as connected homes, networked homes and home automation, are the cold fusion of domestic technology: always promised, never delivered.

Well, some have tried to deliver, just not very well or very cheaply. My earliest memories of home automation probably go back to episodes of “Lifestyles of the Rich and Famous” and “Silver Spoons”; I watched different systems in a house come alive thanks to a wall-mounted control panel.

It was the stuff of fantasy, and it has remained that way for most people because traditional home automation relied on yards of wiring and insanely expensive installation costs.

But little by little, home automation has crept into our houses and apartments thanks to two things many homeowners already have — Wi-Fi networks and smartphones.

A home’s Wi-Fi network is the perfect low-cost, low-impact infrastructure for machines and devices to communicate with each other. And with a smartphone, you have the perfect wireless control panel that can work in your house or when you’re halfway around the world.

One of the best examples of this new approach is Nest Labs. This is a Silicon Valley start-up that has shaken up the otherwise sleepy thermostat industry by introducing a $250 device that not only uses motion detection to figure out when you’re in a room and predict when you’ll be out, but also gets on your home’s wireless network so you can use your smartphone as a remote control.

This is helpful when you don’t want to get up from the couch to turn the air-conditioning down, but even more so when you’re leaving work and want to adjust the temperature before you get home so things are appropriately cool or toasty when you walk through the front door.

For people who don’t have central HVAC systems, the air-conditioner manufacturer Friedrich has a line of window units called Kühl that, later this summer, will offer Wi-Fi capabilities. With a smartphone app, you’ll be able to control the units (which come in either AC-only or AC-and-heat combined versions) from wherever your phone has a data signal.

You know those timers that you plug into a wall outlet and then plug things like lamps into? Belkin is giving those devices an upgrade with its WeMo line of power accessories. The name is annoying, but the units themselves are pretty cool and simple to use.

You plug a WeMo unit into a wall outlet and then plug an electrical device (lamp, TV, stereo) into it. WeMo units are Wi-Fi enabled, and a smartphone app allows you to control when power is delivered to the device that’s plugged in.

In addition to manually turning on and off lamps and such, you can put WeMos on a schedule, just like the older timer units.

A $50 WeMo unit works with the smartphone app; a $100 version adds a motion detector so your television can turn off, for example, if everyone leaves the room.

Wireless data is making itself useful outside the home as well.

In olden times, lawn sprinkler systems were run on a schedule. The first big evolution was adding rain sensors, which could delay a scheduled watering if enough rain had just fallen. But that system remains only reactive, not predictive. Sprinkler controllers from HydroPoint, sold under the WeatherTrak brand (the WeatherTrak ET Plus starts at around $300), pull in local weather data from the National Oceanic and Atmospheric Administration to adjust watering schedules. So if a thunderstorm is headed your way, the system can automatically reschedule the sprinklers to prevent wasting water. A smartphone app allows manual override of the system.

Not all Wi-Fi-enabled machines make sense. Earlier this year, Samsung showed off its WF457 ($1,700) and DV457 ($1,700) washer and dryer, which can be controlled and monitored via a mobile app.