For this week’s Engadget Inteview, veteran journalist J.D. Lasica spoke with Bluetooth SIG executive director Mike Foley from his headquarters in Bellevue, Wash., about wireless headphones, hands-free phone gabbing, and what kinds of Bluetooth-enabled gadgets we’ll be seeing in the years ahead.

For those who aren’t familiar with Bluetooth, what is it and why should we care?

From the big-picture perspective, Bluetooth is a short-range wireless technology with its mission in life to replace cables and to allow devices to communicate with each other without having to plug them together.

Work on this began in the mid- to late ’90s. Since then, work has been done on enhancing the specification, creating a good test program that devices go through before they enter the market to ensure interoperability between devices, and getting Bluetooth into many devices so that it really becomes valuable to the consumer.

The initial use cases we’re seeing lots of take-up now is in the mobile phone to a wireless headset for you to take and receive calls on. Similar to that is its use in the car, where you can take calls from your mobile phone hands free, so you use your speakers in your car stereo and a microphone that’s typically placed above your visor to take and receive calls.

Beginning this summer, we’ll see a wide number of stereo headsets available, and then your mobile phone and portable media devices will be able to play on those headsets without having to plug them into the unit.

Stereo headsets for music?

Exactly right. The scenario there is either your portable music player like an iPod or your smart phone with music capabilities would be able to play to that Bluetooth headset.

Probably next year you’ll be able to stream music to your car stereo so that you’d be able to access music from a single digital music store in your car as well as your home.

We recently profiled Motorola’s iRadio initiative here. What other companies are working with Bluetooth?

There are many companies working on the stereo music capability. Today you can buy an adapter for the iPod that enables that with Bluetooth to stream to a stereo headset. Most, if not all, of the mobile phone manufacturers are looking at this to see how the mobile phone can be your No. 1 digital music store device.

Let’s start with cars. Bluetooth car kits are available from Nokia, Motorola, Parrot and other companies. How does that work?

One of the things that was exciting for us in 2004 was the number of factory-installed options had increased from fewer than 10 to more than 30 models where you can get Bluetooth factory installed.

I want my Bluetooth Jaguar!

Sure. There are also add-on kits where Bluetooth is integrated with your car’s entertainment system. So if you’re driving down the road listening to the radio or a CD and a phone call comes in, you hit a button on the dashboard or on the add-in unit, or use voice control to accept the call, and your music will turn off while you’re taking the call, or the CD would pause. When you’re done with the call, the music resumes.

In some of the newer models, you can see the number of who’s calling on your stereo or on your rear-view mirror or on the windshield at the bottom.

The most popular use of Bluetooth today would be in mobile phones, is that right?

That’s correct. The most devices sold with Bluetooth are the mobile phones. Initially they were the high-end phones but we’ve seen the trend where Bluetooth is in more and more models. We envision that within a couple of years it will be difficult to buy a mobile phone that doesn’t have Bluetooth in it.

Any numbers on Bluetooth deployment in cell phones?

Research from IDC found that 13 percent of mobile phones in the U.S. had Bluetooth, and they expect that number to go up to 65 percent or more by 2008. Globally, IDC is forecasting 63 percent of all mobile phones to have Bluetooth by 2008.

What’s the advantage of having Bluetooth in your cellphone?

There are a couple of key advantages. One is the wireless headset — to be able to take your calls via that, or the hands-free operation that we discussed earlier. Other advantages include synchronizing your phone with your personal computer to keep your contacts and schedule and task list current on your mobile phone.

Another usage for Bluetooth in the phone that’s much more popular in Europe and Asia than it has been in the States so far is where you use your mobile phone as a modem for either your personal computer or PDA. The reason it’s been more popular in Asia and Europe to date is they have faster wide area networks. But now that we’re starting to see 3G networks being deployed in the U.S., I think we’re going to see that become more popular here as well.

Why is Europe ahead of the U.S. in Bluetooth technology overall? Is it simply a technology issue or do corporate gamesmanship come into play too?

I think it’s also the personal mentality that Europe seems to be more mobile phone-centric while the U.S. is more personal computer-centric.

I understand that Verizon Motorola V710 freezes out photo transfers to computers with Bluetooth, instead requiring customers to use its proprietary photo-transfer service for an additional fee. Are you running into those kinds of issues?

We have seen that a couple of times in the U.S. That has been disappointing because it’s confusing to the consumer. Bluetooth has gotten to the point where people now have a pretty good understanding of what a good Bluetooth phone implementation is, and when they take a picture, they expect to be able to either beam it to one of their friends or to a printer. When they haven’t been able to do that, it’s caused disappointment and confusion. ‘Why can my friends phone-beam the picture but yet mine can’t?’ We’re trying to work through that.

Do you consider Bluetooth an open platform? Members have to join and pony up some dough, right?

We consider ourselves an open standards group. You need to be a member of the Bluetooth SIG to implement the standard. There’s a free and a paying membership level. And there is a one-time fee associated with creating a Bluetooth product because of the requirements for certification and testing.

Bluetooth still hasn’t come into its own in the personal computer field. Is Apple leading the way there?

I think your assessment is fair. We think Bluetooth has a lot to offer to the personal computer world, and it hasn’t been as widely adopted there.

You’ve seen Apple and the Mac be more aggressive in this space. Last November, the latest version of the Bluetooth specification was published, and in February Apple released a Powerbook containing an implementation of that spec that was exceptionally fast. I wasn’t expecting to see that until this summer. Apple is showing great innovation and leadership in that space.

What does the Bluetooth Powerbook do?

It’s able to interface and synchronize with your phone. You’re able to exchange files with other personal computers or your PDA. You can use wireless mice, keyboards, printers with the personal computer. The main advantage for the new version of the spec is that it has a higher bit rate. If you’re exchanging a presentation or pictures between two devices, it lets you do that faster.

I’m looking beneath my desk right now and I’ve got more cables and coils than a used car lot. The vision is that a lot of that is going to go away some day?

We’ll definitely be able to remove the wires behind your desk. Already you can remove the wires from your mouse, your keyboard, your printer. The biggest challenge Bluetooth can’t solve today would be the cable to your monitor, which requires a higher bit rate.

Let’s talk about some other gadgets. What does Bluetooth add to a cameraphone?

The largest camera manufacturers are shifting to cell phones because they’re putting cameras in so many phones. Clearly, the optimum usage model is where you take a nice picture on your camera phone and send it directly to a printer or to a person standing across from you using Bluetooth. As people get used to using the camera on their phone to get that kind of instant gratification, that will drive even greater use of those camera phones.

The other trend we’re seeing is higher pixel density on the phones. It won’t be long before 2- and 3-megapixel phones will be common here.

What if you wanted to publish your picture to the Web? Bluetooth is only for short range communication.

You could take one of two options. You could use Bluetooth to transfer the picture to your personal computer that’s connected to the Web and publish from there. Or you could use the wide area connection already in your phone to publish to the Web that way.

What about the social dimension? Howard Rheingold wrote Smart Mobs, about how people are using portable devices to communicate and interact in surprising ways. Will Bluetooth be a part of this?

The owner of a Bluetooth device can decide whether they want their device to be seen by other devices, that’s a term called discoverability. You can search for all nearby devices and it will tell you all devices found. If you’re in an open area, the range can be 20 or 30 meters. You could find a long list in a place like a train station. Then, you’d have a business card, where instead of your name, you have a nickname or handle and watch and see who looks at their phone to narrow it down who you’re communicating with.

Why would anyone want to be discovered, other than to hit on someone?

People have different motivations. I always keep my phone discoverable, because when someone wants to send me a legitimate business card, it’s just easier to have the person send you it. It’s a classic ease-of-use vs. privacy situation.

What about the privacy issues? Bluetooth devices have been hacked or commandeered.

We definitely continue to work with our memberships to make sure that the devices out there can’t be hacked into. Not every issue has been solved, but the problem has been minimized. Most known devices with a problem are either not sold anymore or a patch has come out.

We keep hearing about smart refrigerators what will order a half-gallon of milk when we’re running low. Will there really be Bluetooth fridges, microwaves and toaster ovens?

There is some work in the appliance industry, but that’s not a major driver today. Toshiba is working on some of those implementations.

Home automation or home security systems offer tremendous value. If you install a security system, you’ll be able to install sensors on your windows and doors and have those transmit wirelessly back to the security panel. That’s a very nice setup. Bluetooth could communicate with your mobile phone so you can arm and disarm your system as you enter and leave the house.

How might business travelers take advantage of Bluetooth?

The one nice scenario for business travelers using Bluetooth is dialup, where you use your mobile phone as a modem and connect your PC to the network that way. You could connect wherever you’re at using a wide area network — you don’t have to go searching for a hotspot. And you can run email applications, browse the Web, connect back to your corporate intranet to run applications, and so on.

When you look at the gadgets we highlight on Engadget, do you see most of them becoming Bluetooth-enabled?

I think a lot of them will be. It will depend a little bit on how successful Bluetooth is in various markets. In the home entertainment cluster, those devices can potentially be very good to have Bluetooth in for remote control. What’s nice about Bluetooth is that it’s not directional and you can transmit data in both directions.

You can create a smart remote control that displays information about the movie being played, or the tracks on the CD, or about the TV show being displayed. You could transmit the guide to the remote rather than having to show it on screen.

In the portable devices space, that’s where Bluetooth’s strength is today, because it’s such a low-power and efficient technology, and can be added to those devices without causing their batteries to drain significantly. So the portable gaming consoles you see are prime type devices for Bluetooth to enable multiple-player gaming.

Why haven’t we seen more in the way of interactive television? Will Bluetooth let us communicate with our TVs through our laptops?

Yes, your laptop or a tablet-like device. You can come up with all sorts of interesting form factors. To be able to out-of-band information from the TV and display it on the device in your lap, the possibilities there are tremendous.

Most interactive TV systems today take up a part of the real estate on your screen, and typically people don’t want to give that up. Some of the TV manufacturers are looking into it. So far I haven’t heard of any interest by Hollywood or the content creators.

Does Bluetooth need to become better known by the average person in the street, or do you just need to be known by the device manufacturers?

The consumer really cares about the function, or what’s enabled. They want to be able to do hands-free talking in their car. The reality is that people are coming to understand you need Bluetooth for that. In the UK, there’s 77 percent brand awareness for Bluetooth.

What about in the U.S.?

In the U.S., awareness almost doubled from 22 percent to 41 percent of those polled being aware of Bluetooth from 2003 to 2004. In Japan, that figure increased from 43 percent to 61 percent.

Where do you see Bluetooth going in the next few years?

This year we’ll continue to see more Bluetooth-equipped cars, letting more people using the hands-free operation. I also think we’ll see Bluetooth extend into portable media players for use in the car, so you can take your digital music store with you.

We’re also looking at being able to address the video market in addition to what we’re doing with audio.

Beyond that, we’re looking at technology that enables its use in more vertical segments like industrial automation. A conveyer belt on a factory floor, with sensors all over it, could use Bluetooth to report the status of the widget being created.

Bluetooth is an established technology found in more and more devices, but we’re still enhancing the technology and making changes for new industries to come on board, like in the medical devices field. So we’re really just on the tip of the iceberg.

J.D. Lasica’s new book about the digital media revolution has just been released: Darknet: Hollywood’s War Against the Digital Generation (Wiley & Sons).

Special thanks to John Hamilton.

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For this week’s Engadget Inteview, veteran journalist J.D. Lasica spoke with Dave Ulmer, director of marketing for Motorola Media Solutions about Motorola’s upcoming release of iRadio and how the technology may forever change how we listen to radio. Oh, and no satellites involved.

Shine that spotlight on the big picture, would you? Why is iRadio a big deal?

Sure. Well, iRadio is rather unique for Motorola in that it’s not a piece of hardware but a music service. It enables a consumer to have their choice of hundreds of channels of commercial-free radio and talk and their MP3 collection wherever they happen to be – whether at home, on the go or in their car.

The car is the focus for us because that’s where the majority of music listening occurs – while they’re in the car stuck in traffic someplace. We emerged from Motorola’s Seamless Mobility initiative, which was designed to connect the big three domains of Motorola: the car, the phone, the home network. Our focus has been on music and moving on into video in the future.

So people will be able to subscribe to your service and take it with them anywhere they go?

Correct. It’s a service that will involve an application that will reside on your phone and on your PC. Your phone will be constantly refilled with content. The initial phone — we haven’t announced the model yet — will be capable of holding about 10 hours of music and talk at a time, and you’ll be able to refill that at night in a USB charger dock to retrieve content over the Internet. Throughout the day it will be getting updates over the air. That will involve hundreds of channels of music from almost any genre, so you can really personalize the kind of music that you like to listen to.

Between the music you like to discover and the music you own, it will be a combination of the benefits of both satellite radio and an MP3 player but it’s on your phone. We added this unique approach to be able to play that music in your car, knowing that you’re probably not going to want to hold your phone up to your ear to hear all of this.

And how did you solve that problem?

Solutions till now have been less than optimal, or as our marketing people here say, they suck. You’ve had to get a bunch of wires, plug something into your cigarette lighter and something into a device — all of that results in lower-quality audio and a clumsy way to change channels.

So we invented something new called a wireless audio car adapter. It’s a small little box, about the size of a deck of cards, that plugs into the back of your radio. It pretends it’s a CD changer, so the radio doesn’t know what’s going on, and we’ve created a sort of Babelfish translator from Hitchhiker’s Guide that can translate between radio speak and into phone speak or iRadio talk which broadcasts over Bluetooth.

So all you do when you get into your car is you sit down with the phone in your pocket and it’s taken over your radio. When you turn on your radio, it’s actually conversing in two-directional Bluetooth. To a user, it feels a lot like magic. You turn on your radio and you get the channels you want to listen to.

For any Bluetooth virgins out there, what is it?

It’s a low-cost, low-energy wireless technology. Virtually any cell phone today is Bluetooth-enabled, as well as any new PC.

What’s on your iRadio?

In my case, my button No. 1 is commercial-free Southern rock, in very high digital quality. I switch over to channel 2, 3, 4 and it’s playing my selection of radio stations as well as my own MP3 files. You can go forward or back through your collection, pause, rewind. The radio stations play like regular radio files, with the one difference that you can pause in the middle of a radio song and resume. If a phone call comes in, it will automatically pause your content.

Who installs the box in the back of your car — a professional, your car dealer?

Depends on the person. If you can’t pull your radio out, then no. If you can, then it’s a very, very simple install. To help that out, we’ve set up a nationwide network of installers — the same people who install satellite radio and work for the major retail chains.

iRadio is compatible with what percentage of car radios?

It’s somewhere over 80 percent.

And we’re not limited to cars.

For your home, it’s an even easier solution. No dashboard. Last week we announced upcoming audio adapters for your home. When you get home, your phone can talk to your home stereo connected to the adapter through RCA jacks, again using Bluetooth.

Let’s talk content. You have 10 hours of material you can download from the Net, plus additional music stations that stream over your mobile phone?

The content that is coming from the Net is from pre-existing partnerships that we’ve established with major content providers. So we’re not just opening up wholesale recording of anything you want off the Internet, and we haven’t yet announced who they are, but they’re very big names involved with delivering Webcasting and music services over the Web today. Plus, whatever audio files or MP3s you want to include as well.

I love podcasts. All I have to do then is subscribe to a podcast, download it to my machine and it’ll play on my radio even though they’re not a Motorola partner?

Correct. Any files you have on your machine today that are MP3, WMA, AAC, depending on the phone.

OK, that’s the Internet/PC half. How does the radio half work?

As you know, most of the music you hear on the radio dial is already pre-recorded. It may have been recorded a day or week ago. Even the DJs aren’t as live as they once were. We made arrangements with online services that have radio Webcasts and are basically caching those programs at night, and then storing them in a buffer on your phone, and then streaming them to you when you’re in your car over Bluetooth.

For most content, having that five- or six-hour delay doesn’t matter so much. There is content where it does matter: breaking news, traffic, weather and sports. For hot content, we take that over the cellular network and update that in your phone throughout the day periodically. So when you’re driving home at night you’re getting news and traffic updates from several minutes ago rather than several hours ago.

And you don’t know it’s happening.

There’s no interaction required on the consumer’s part. You don’t have to hit buttons or commands of any sort.

This only works with certain wireless carriers?

There’s nothing technical that prevents it from working with any wireless service. The phone has to have Bluetooth, it has to have storage — we’re using 256MB and there are phones coming with much, much more than that. If a phone meets those criteria, our service can go in and make it work, regardless of whether it’s GSM or CDMA or what have you.

Any date for launch?

Q4.

What about price?

We have some estimates. It really depends on what the carrier and the content provider agree upon. We believe it’s going to wind up in the $5 to $7 per month range per consumer. It’s not backward-compatible, but we’re building this into as many phones as we can as quickly as we can, so add in the cost of a mid-tier cell phone. The wireless audio adapter I mentioned will probably run $50 to $75.

You’re not targeting just the high-end crowd, then?

It’s for the masses, absolutely. The cost will come down pretty quickly over time. Motorola works quite closely with all the major auto manufacturers and we’re looking forward to that day when you don’t have to install anything to make this work. Most new cars will be coming with Bluetooth and wi-fi in the future. I suspect in three years we’ll start to see strong penetration of Bluetooth in the vehicles.

How do iPods play into this trend? Is this an iPod killer?

On the contrary, we have a very good relationship with Apple, and we’re going to have phones coming, in partnership with Apple, that will play iTunes files. And wouldn’t it be a good thing to be able to play and control those tracks from your car radio rather than from your device?

I really don’t see this as an iPod killer, it’s an iPod enhancer. In fact, if an iPod had Bluetooth with a little snippet of code from us, it would be able to be played on your car stereo and your home stereo and controlled on your stereo.

It’s almost more of an AM-FM killer.

Other than my local PBS station here, I never listen to radio. What’s going on? People are abandoning commercial radio because they want what they want?

I think you nailed it. Over the past 10 years, AM-FM has really gone downhill. It’s an increase in commercials and a decrease in selection. The personalized, genre-specific stations in almost all the major markets have disappeared, because the major advertisers pay for adult contemporary. Your slow jazz station is probably not there anymore.

Now there’s this wealth of ability to get your songs out and address this personalized audience out on the Internet. The problem is you’ve got 800 million car stereos worldwide, and only 20 million people listening to music on the Internet because you have to be stuck in your office or living room to listen to Internet radio.

So people are popping in their CDs but they’re getting frustrated that they can’t carry in their MP3 files. There’s a surge of interest in satellite radio, but still relatively small numbers — there’s a barrier to entry there. And there’s a tremendous desire to listen to … not quite personalized channels but channels of music that you like.

So here’s where playlists enter the picture, too.

Right. People don’t want to get too active and say I want to hear this song followed by that song. They don’t want to program, they still want to discover music they haven’t heard before.

One of my favorite stations is my Angry Woman channel. It crosses decades and genres. I’ve got some Avril Lavigne, some Blondie, Janis Joplin, Alanis Morissette. There’s jogging music, workout music — next we’ll see an I Just Broke Up radio station. Music that fits your tastes for that moment.

We’ve added one kinda cool feature. You can hold down a preset button on the radio and add that song to your wish list that’ll appear on your PC and your phone.

So how do you buy the song?

It depends on who’s your music provider. If you’re a Napster subscriber it’s going to be a WMA file. If you’re buying from iTunes it’ll be an AAC file. And then we’ll throw it into your PC and phone.

What else is coming?

One cool thing coming in Q3 are the Bluetooth headsets, where you can have a phone or MP3 player with Bluetooth. You definitely can appreciate that when you’re on the treadmill.

So this is about much more than the car.

We think so. Whenever you get out of your car, it automatically pauses the player and the next time I hit play on my phone, my phone turns into my portable player.

With a loss of audio fidelity, no doubt.

Up to this point, that has been true. But I have seen the future. I’ve seen phones with some amazing speakers on them — 3D sound with bass transducers throbbing in your hand, stereo speakers. You’ll see those later this year.

Where do you see this all going?

Worldwide, you look at 800 million car radios and last year 683 million cell phones sold — that doesn’t compare to something that sold 3 or 4 million copies.

Like satellite radio.

Satellite radio is a great service for the high end — high price, high installation, limited flexibility. A very cool service, but available only to the upper echelon. We really see this as something that’s going to be supplied on the phones and quickly inside the cars and everybody can say I want those benefits for six or seven bucks a month and an additional device.

Will you be able to get your satellite stations on iRadio?

Well, XM and Sirius are content companies more than they are hardware companies. We can certainly deliver XM and Sirius content to your home, your phone, your car, if they wanted to. We’re creating the infrastructure, the pipes, to give anyone with content access to those consumers in those domains at very low cost.

Apart from satellite, there’s only so much music listening you can do on your PC, and those 20 million people who listen to Internet radio aren’t going back to commercial radio when they get in their car.

How does iRadio fit into the vision of a celestial jukebox?

I’ve been talking jukebox in the sky for the past seven years. There’s a lot of technology needed to pull all this off. I’m hoping to see the celestial phone service in the sky that will always give you a connection and clarity on every phone call I make. We’re still a ways away from being able to stream music flawlessly over the air no matter where you are.

What we’re doing is actually a step in that direction, where we’re doing cache and forward with the bulk of content, and streaming content that makes sense to stream. In effect, you can be a mile underground, you can be on a subway or a train and still get crystal clear reception because it’s been cached and forwarded to your phone.

I think what we’ll find is that the celestial jukebox in the sky is a bit of a misnomer. It’s a celestial jukebox that’s served up from the sky but it’s actually in your phone, in your car, in your pocket, in your home — bits and pieces of it reside in different locations in your life and they’re bounced around to you no matter where you might be.

So you won’t have instant access to all the world’s music?

No, it’ll be a subset. The bulk of your content will always be on a server somewhere. It might be in your home or in an online service. But how big of a subset is big enough? When phones and car radios roll out in the days ahead with 20 gigabytes of storage, that’s a lot.

So we’re going to soon see cars coming off the assembly lines with hard drives under the hood?

I have seen cars in the planning stages that have hard drives, yes.

Then that’s the ultimate mobile device — one you can drive 60 mph.

That’s right. The world’s largest MP3 player.

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