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From Auto.Com:

New way to drive and call

Chrysler to debut a hands-free cell phone device

DaimlerChrysler AG's Chrysler Group might have found a way to give a cell-phone-craving nation what it wants most -- the chance to talk hands-free on their own cell phones without attaching wires to their heads or installing ugly gizmos in their vehicles.

Today the automaker rolls out the UConnect system, which wirelessly links a motorist's cell phone with a microphone installed in the vehicle. It works with any cell phone that uses a special wireless system called Bluetooth.

Initially, the system will come factory installed only on the 2004 Pacifica, but it can be purchased at Chrysler, Jeep and Dodge dealerships and loaded on almost all DaimlerChrysler vehicles dating to 1994.

Thilo Koslowski, vice president and lead automotive analyst for Gartner/G2, has tested the system and said it comes the closest to giving customers what they want.

"The basic fundamental lesson is don't replicate the personal computer experience in the car," Koslowski said. "Others have tried to give consumers access to e-mail and online information. The vehicle is a mobility tool, and consumers are interested in doing what they are used to in a car, talking and driving."

To make a call, the motorist pushes the UConnect button, which connects the cell phone to the microphone. The motorist then states the name or number. The system stores up to 32 names, and four numbers per name.

The voice-recognition system responds, confirms the number and dials. The number appears on the face of the radio as it is being dialed. The radio speakers provide the sound on the factory-installed version, while a separate speaker is installed on the dealer option.

Up to five cell phones can register with the system.

The customer needs to have a Bluetooth-enabled telephone. Bluetooth connects two electronic products together via a radio frequency. Several cellular phone providers, including AT&T, T-Mobile and Nextel,offer Bluetooth phones ranging from $100 to $300.

Chrysler Group, which has already spent millions researching and refining UConnect over the past two years, is throwing the dice in the risky telematics business. Telematics is two-way data and voice communication between vehicles and external sources.

There have been hundreds of telematics ideas and companies that have tried and failed. Most notable was Wingcast, a joint venture between Ford Motor Co. and Qualcomm that was dissolved in 2002. Wingcast was expected to offer a variety of wireless services in Ford vehicles.

OnStar, General Motors Corp.'s telematics approach, offers motorists a variety of subscription services. OnStar started in 1996 and began posting a profit in 2002.

Jack Withrow, Chrysler's director of vehicle entertainment and communications, said this system has avoided the pitfalls of its predecessors because it is not offering subscription services or requiring them to leave behind their own cell phone and use one installed in the car.

"What people really want to do is talk on the phone in their cars," Withrow said. "They don't want to trade stocks or read e-mails. It's also a waste to offer people information services they are not going to pay for. Information is like water; it's everywhere."

The UConnect system costs $275 factory installed or $299 dealer installed, not including labor.

More than 128 million people across the nation own cell phones. One in four drivers uses a cell phone while driving.

"People know that it's not a great thing to be holding a cell phone while driving but people want to be on the cell phone," Withrow said.

But Koslowski said to use UConnect the customer has to buy a Bluetooth phone and not many people know what Bluetooth is.

Terry Sullivan, OnStar's spokesman, said customers want versatility and services such as unlocking doors or contacting the police at the touch of a button.

"The UConnect is a cell phone and doesn't offer safety and security features which can be provided through an embedded system like OnStar."

If UConnect proves successful for Chrysler, it could be picked up by other automakers who want to avoid potential legislation or legal problems.

Philadelphia, Chicago and Aspen, Colo., along with 22 states across the country are considering laws to ban the use of cell phones while driving.