General Motors Corp. Chairman John F. (Jack), Smith Jr. acknowledges growing concerns about cellular telephones and telematics devices distracting drivers, and he uses his keynote address on the final day of Convergence 2000 to announce two new features for GM's OnStar telematics system and a multi-million dollar safety initiative designed to reduce distraction risks to drivers.

Driver distraction is a major issue at the conference, from official presentations to hallway conversations. It could become a huge roadblock to the global telematics industry, predicted by some to grow to $8 billion by 2005 from $1 billion today.

No company has more riding on telematics than GM. While it continues to struggle with its falling share of the U.S. light vehicle market, it has emerged as a leader in the burgeoning telematics market, with even Toyota Motor Corp.'s Lexus Div. and Honda Motor Corp.'s Acura Div. using GM's OnStar service.

Just three years ago, OnStar had only 20,000 subscribers. Now, Mark Hogan, president of e-GM, predicts there will be 800,000 subscribers by year-end, and 4 million by 2003. That is, if legislation doesn't stall progress.

Mr. Smith says that since 1995 legislators in 37 states have introduced more than a hundred bills aimed at cell phone usage in moving vehicles, and this year alone such bills have been introduced in 27 states.

"The growing concern over the use of conventional hand-held cell phones in vehicles can be expected to extend to all areas of telematics, and applications continue to expand. And this has major implications for all telematics suppliers and OEMs. It means the time for the industry to be proactive in understanding the real causes and effects of driver distraction and in educating the public on safe and proper use of telematics technologies is now," Mr. Smith says.

Two new OnStar features for the 2001 model year, which Mr. Smith says will help in this regard, are Personal Calling and the Virtual Advisor.

Personal Calling allows OnStar subscribers to use speech recognition technology to place hands-free, voice-activated calls on a nationwide wireless network. The phone is embedded in the vehicle and claimed to be far more powerful than a typical hand-held cell phone. There is no handset, and you only have to push one button to activate the calling feature.

The second feature, OnStar Virtual Advisor, enables subscribers to access personalized Internet-based information such as e-mail, stock quotes, sports scores, news and weather in a hands-free, voice-activated manner while they are driving. The information is delivered through the vehicle sound system to allow drivers to keep their hands on the wheel and their eyes on the road. There are no screens or displays.

Mr. Smith also announces a nationwide research and education program called "SenseAble Driving."

It will focus on three elements:

* Understanding and quantifying common perceptions and misperceptions about driver distraction.

* Developing an interactive computer demonstration for young drivers.

* Cooperation with state driver's licensing agencies across the country in spreading the message of driving with eyes on the road and hands on the wheel.

Critics complain that none of these measures addresses the issue of what's known as "cognitive distraction" - the mental distraction of listening or talking while driving.

But Mr. Smith counters that the issue of cognitive distraction dates back to the '20s and '30s, when some people advocated a ban on "a new invention called the car radio."

"The point is: There is no way to eliminate all forms and causes of cognitive distraction. Not unless we eliminate passengers or somehow prevent the driver from listening or talking to them - especially if they happen to be quarreling children.

"That makes driver behavior the paramount issue. We, the industry, have an obligation to offer systems and features that create minimal distraction. We also need to help educate drivers themselves about the importance of minimizing their own distraction while they are driving. Technology alone, no matter how advanced, can never replace the driver's own judgment."

In a press conference following Mr. Smith's speech, Bob Lange, GM's engineering director for automotive safety, also points out that "lock-out protocols" that prohibit especially demanding tasks while driving are being developed or are already in place. Mr. Lange says that future systems would even have the capability to sense the importance of a telematics activity and shut it down automatically if driving conditions suddenly become more demanding.

Mr. Lange's light-hearted analogy: If you are driving down the road verbally composing a haiku, and wheel sensors detect the road surface is getting slippery, it would temporarily interrupt your creativity.