Not since the introduction of the mobile phone has the plain old home phone been in for such upheaval. The device long used for landline calling, recording voice mails, and storing phone lists may find itself replaced by cordless devices, from makers including Netgear Uniden, and Thomson, that let users make low-priced Internet calls, view photos and video, and browse the Web.

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In 2007, home phones will get slimmer and sleeker even as they bulk up in memory and processing power. They'll come to resemble cell phones in looks and personal computers in features. "We've seen the change in cell phones [from clunky bricks to elegant handhelds], and we'll see home phones change the same way," says Rich Tosi, president of Uniden.

The advances are coming just in time. Sales of cordless phones have slumped as more people rely on cell phones for everyday use, some doing away with landlines altogether. "There hasn't really been a significant need for [consumers] to upgrade to another device before," says Maribel Lopez, an analyst with consultancy Forrester Research (FORR). "This is a really good opportunity for hardware manufacturers." Cordless phone sales declined 12% to 24 million units in 2006, according to NPD Group. New features could boost home phone average selling prices and slow declines, says NPD analyst Ross Rubin.

Destined for Popularity
One of the most popular features is likely to be the ability to place calls over the Internet as well as traditional landlines, says Rubin. Today, only 1% to 2% of consumers use such phones, according to Forrester Research. But that's likely to change amid the growing popularity of services like eBay's (EBAY) Skype, which allows for cheap or free Web-based calling. It now has more than 136 million registered users and is growing at a rate of about 20% a quarter.

In response, Thomson and Netgear have released phones that work with Skype. Thomson's GE DECT 6.0 phone lets users see when their Skype contacts are online, get notified of messages, and place and receive calls via Skype. Better still, the phone won't interfere with home wireless fidelity, or Wi-Fi, networks and offers a broader roaming range than widely used 2.4GHz models. Netgear's candy-bar, cell-phone-like device works over the home Wi-Fi network and can place and receive Skype calls. Other manufacturers are developing models that will run on both cellular and Wi-Fi networks.

Some of these new home phones work well with other home electronics, too. Motorola's C51 system lets users connect handsets like an intercom and watch output from a camera, which can be used as a baby monitor. When used with a cell-phone dock, the C51 system lets users take mobile phone calls on their home phone handsets. Next year, Motorola is due to release a home phone with a larger color screen that will be able to play videos from a digital video recorder and display photos stored on the home PC, says Barry James Folsom, corporate vice-president and general manager for connected home solutions at Motorola. This product will be shown at the 2007 CES show.

HD Voice: The Ultimate Feature
Home phones also allow for short-text messaging (SMS) and video calls. For instance, Uniden's Windows Live Messenger phone lets users receive and send instant messages, get notification of new e-mails over Microsoft's (MSFT) Hotmail service, and run animation on its color screen. "So far, we are pretty pleased with the initial results," says Tosi.

The more features they boast, the more memory phones will need. In the next year, Motorola expects to double the amount of storage available on some of its cordless phones' base stations.

Another feature due soon: high-definition voice calling. Polycom (PLCM) recently came out with Polycom Communicator, allowing high-quality calls with Skype for business users. The same better sound capability is sure to trickle into consumer home products soon, say analysts.

Home phones' design is evolving, too. In 2007, Motorola, for one, plans to start using batteries it currently uses in its famed RAZR mobiles in its home phones, says Folsom. The smaller, flatter battery will allow for thinner home phones. It will also allow new Motorola home phones to come fully charged (today's cordless models have to be charged for 6 to 14 hours before first use). "It's going to be reinvention of the cordless phone," Folsom says.