(FORTUNE Magazine) – To a lot of people, the term ''wireless revolution'' conjures up the image of a yuppie with a flip-phone in a fancy restaurant. That was the old wireless revolution. Well out of earshot, dozens of companies are spending billions of dollars to build two-way wireless communications networks that will carry not phone calls but data -- electronic mail, faxes, and computer files. ^ Just as voice mail did a few years ago, wireless data networks will change the way you communicate on the job. That's putting it mildly. The networks won't merely liberate you from telephone tag, but will let you stay in touch cheaply and easily without needing to be tethered to the phone and computer on your desk. This freedom will be ever more important as the nature of work changes. Companies will consist increasingly of people who interact with customers, usually off the premises, as central-office tasks become the job of fewer workers using better computers. ''Eventually, 90% of people who are working will be tetherless,'' says Ernest von Simson, senior partner of the Research Board, a New York City association of corporate information officers. ''That will be true even for things that used to be done by armies, campuses of people. Think of all the people who used to be insurance underwriters.'' As the work force becomes more mobile, the ability to move information without wires becomes crucial. Those most likely to know about data networks now are not the expense- account crowd but blue-collar workers. Businesses such as British Airways, United Parcel Service, and Otis Elevator use wireless networks to share information with service people in the field. Still, most network operators -- big names like IBM, Motorola, and McCaw Cellular, wannabes like Nextel Communications, and unknowns -- believe the future of the industry is with individuals. The first large-scale applications are likely to be for business people who need to send and receive written messages while on the go. As costs come down, consumers with small hand-held devices will be able to make reservations for dinner or a flight to Timbuktu while strolling around town. Never mind the headlines you've been reading lately about the coming boom in cheap cellular phone service. The next big surge in telecommunications will almost certainly involve wireless data. Just look at what has happened with ordinary phone networks. Data transmission on today's telephone systems is growing by as much as 30% a year, according to some estimates. On certain routes, data -- not conversations -- constitute the bulk of the traffic: Between the U.S. and Japan, for instance, fax data make up as much as 90% of all telephone signals. You can expect the same evolution in the wireless world. Whereas cellular conversations account for almost all wireless traffic today, BellSouth, a power in both the cellular business and data networking, predicts that by the end of the decade fully one-third of its wireless revenues will be from data, and that as many as 25 million Americans will use wireless data devices. The data networks will fuel an explosion of new products and services. Already, you can connect your laptop computer to a cellular phone with a special modem that lets you send faxes and retrieve files from a database. Soon to come: tiny radio modems, no bigger than a credit card, that will slip into laptops and smaller devices and link them to the wireless networks. They could prove the salvation of personal digital assistants like Apple's Newton, which has been derided as an overpriced memo pad. Equipped with the right modem, your PDA will be able to send and get messages, stock quotes of favorite companies, and maps of the route to a meeting. The secret of wireless data networks is the nimble way they handle information. Like cellular phone systems, the networks use radio signals that travel between your little computer and receivers dotted around a service area. There the similarity ends. When you push the ''send'' button on a cellular phone, the network gives you exclusive use of the next available circuit for your call. The minimum amount of time you can buy is one minute, for perhaps 50 cents; long-distance charges are extra. That's actually a lot to pay for a data message that might take only a second to transmit. Data networks, by comparison, are Darwinian, with messages fighting to get onto the network instead of politely queuing up for their turn. After you compose your message, a modem chops it into small pieces of several hundred characters. Each so-called packet bears the electronic address of its destination. When you press ''send,'' there's no wait for a circuit. Instead, the device repeatedly fires out the packets until each finds an open channel, in competition with packets peppered out by other devices. When a packet goes through, the network sends back an acknowledgment to your device. A packet ties up a channel for only an instant, so the wait is usually very brief -- perhaps a fraction of a second. Packet switching, as this process is called, can be a far cheaper way to send data than waiting for a clear circuit and hogging it for the duration of the call. Many E-mail messages fit in a single packet. Longer ones go as a series of packets, reassembled in their proper order at the receiving end. Pricing is by the packet -- about 12 cents each, regardless of the distance the message must travel.

Wireless data systems are still rudimentary. The modems are expensive -- from $750 to $1,000 -- and, at about eight inches in length and more than a pound, they're bigger and heavier than some of the palmtop computers to which they are attached. Not all of the networks are compatible yet with MCI Mail, Microsoft Mail, and AT&T Easylink -- the E-mail programs that have become standard in many corporations. You may have to buy new communications software and services, such as the $89-a-month E-mail service from RadioMail of San Mateo, California. Despite the obstacles, wire-free messaging will have powerful appeal for people who can't afford to be out of touch when they are on the road. Alan Reiter, editor of the Mobile Data Report, an Alexandria, Virginia, newsletter, says, ''Executives don't want to crawl under the bed in their hotel room, brushing aside dust bunnies, to connect their computer to a wall jack.'' That is, if they can find the right kind. A room service waiter discovered Reiter one night on his knees in front of a telephone socket, a penknife in hand. He was scraping insulation off the phone wires so he could connect alligator clips and send a story from his computer. The lineup of would-be network builders is wildly diverse, but all are grabbing for the same gold ring: By the end of the decade, wireless data revenues in the U.S. will hit $10 billion a year, according to BIS Strategic Decisions, a consulting firm in Norwell, Massachusetts. A few of the contenders are well-known forces in communications and computing. Some come from realms as mundane as the utility industry. At least one has its head in outer space. Here are key players and their strategies:

-- Ardis. A wireless-data pioneer, Ardis got its start ten years ago as a private network built by Motorola to let IBM keep in touch with service reps while they worked on customers' mainframes. A few years ago, IBM realized the network was grievously underused and formed a joint venture with Motorola, opening up Ardis to other companies with large field staffs. The workers use custom-made hand-held devices with fill-in-the-blanks electronic displays tailored to particular tasks -- transmitting sales orders, say, or asking a company database to find the nearest depot that stocks flanges. Ardis has breadth, with service in 400 cities. But it doesn't cover rural areas and is only now adding equipment that will let a person from one service area send and receive messages while visiting another area (the system originally used different frequencies in different cities). The improved gear will also allow the use of ordinary laptops, and will help Ardis attract white-collar customers. Ardis needs their business to help cover the investment by IBM and Motorola -- to date: $500 million.

-- Ram Mobile Data. This fast-growing joint venture of BellSouth and Ram Broadcasting of New York City has a network that computer-toting executives can use nationwide. Staked with more than $300 million from BellSouth, Ram began building the system in 1991 and now serves 200 metropolitan areas. A subscriber simply hooks his computer to a modem by Ericsson, Sweden's big telecommunications equipment maker, and uses his company's E-mail software to communicate. Chevron executive Dale Reed, who suffers from kidney failure, uses Ram to correspond with colleagues and customers while he undergoes dialysis. He says, ''For the 2 1/2 hours, three times a week, that I'm in dialysis, I can actually get work done. This helps make it a little easier for me.''

-- CDPD. That stands for Cellular Digital Packet Data, and it's the latest project of cellular phone evangelist Craig McCaw, who in August agreed to sell his company, McCaw Cellular Communications, to AT&T for $12.6 billion. McCaw's new dream is of cellular phones that will display text as well as handle voice. He aims to convert America's entire cellular infrastructure to a system capable of carrying packet-switched data. For starters, that means adding packet switching equipment to each of his company's 2,225 cell sites. While McCaw calls CDPD an ''extension'' of the cellular network, it will really be more like a second system that coexists with the first, with its own radio transmitters at each site. If it works as planned, CDPD will fix some of the weaknesses that make today's cellular networks an iffy medium for data messages. Cellular systems are not digital and are susceptible to interference. What might be acceptable, if annoying, static during a conversation can ruin a data file. So can the little clicks you sometimes hear when the system hands off your call to another cell. With CDPD, there's no handoff. If a packet doesn't get through, the system sends it again. Craig McCaw admits that building the network is risky. Complex system software has yet to be perfected, and no one makes dual-purpose cellular ! phones. What's more, the estimated cost of the system is immense: upwards of $5,000 a channel for transmitting equipment, or at least $250 million for McCaw Cellular alone, which accounts for about 43% of the market. McCaw has had to jaw-bone other cellular operators, including the Bell companies, to back CDPD as a technical standard. While a handful -- BellSouth among them -- have actually pledged to upgrade their systems, some may go slow. McCaw Cellular has just begun installing CDPD gear and so probably won't be a factor in wireless data for at least two years. But its commitment to CDPD did help land a big customer: United Parcel Service has equipped its entire fleet of delivery trucks with cellular equipment. Until CDPD arrives, the drivers are making do by sending their data via nondigital cellular calls.

-- Nextel Communications. A few years ago this Rutherford, New Jersey, company was known as Fleet Call and had a handful of taxicab radio-dispatch licenses. Now it is the telecommunications juggernaut of the month -- at least the month of November, when it bought 2,500 radio frequency licenses from Motorola for $1.8 billion in stock. The licenses, combined with those Nextel already owned, put some 70% of the U.S. population within receiving range of Nextel's transmitters.

The company plans to replace the antiquated dispatch systems with a voice and data network. That will take at least three years; until the overhaul is complete, most of Nextel's customers will continue to be companies with vehicle fleets.

-- Nationwide Wireless Network. NWN is an offspring of Mtel, owner of SkyTel, a major paging company. The new company will sell what is essentially a souped-up paging service, in which messages flow two ways rather than one. You'll be able to use your desktop computer and modem to get in touch with anyone carrying an NWN device; it will transmit an acknowledgment that your message has been received. The device holder, for his part, will be able to send wireless E-mail, either by tapping letters on a touch-sensitive screen or by selecting from a menu of canned replies -- ''Sounds good to me, boss,'' for instance. NWN will build its own national network of communication towers and transmitters, separate from SkyTel's. But to jump-start its business, NWN will recruit from among SkyTel's 300,000 customers, perhaps by offering subscribers two-way service for an easy-to-swallow increase in their current beeper bills. -- Metricom. This Los Gatos, California, company has always operated in obscurity, providing wireless data services to utility companies for remote metering and monitoring. Now Metricom wants to apply its know-how to offer bargain-basement wireless data services on college and corporate campuses and in surrounding towns. Metricom uses a clever stratagem to keep costs low: It operates in a part of the radio spectrum set aside by the FCC for free use by anyone. There are obvious risks: While access to the airwaves costs Metricom nothing, anyone who wants to transmit on the same frequencies can butt in and interfere. Most uses of the band have little to do with communication -- the frequencies are used by garage door openers and anti-shoplifting systems in stores. (Metricom will keep its devices from opening garage doors all over town by using a signal code the garage doors can't understand.) Metricom's prices will be hard to resist: Rather than charge by the packet as Ardis and Ram do, it will offer unlimited service for $20 a month or less. Its modems will handle data at a speedy 50,000 to 60,000 bits of information a second -- far faster than Ardis (19,200) or Ram (8,000). Its first test is running at Apple Computer headquarters in Cupertino, California. Stanford University will soon have a system as well.

-- Orbcomm. Call it Plan X From Outer Space. Next year, this subsidiary of Orbital Sciences of Dulles, Virginia, plans to start launching budget communications satellites that will fill in the geographical coverage gaps of all the other wireless data systems. It will put up 26 little orbiters for a total cost of $150 million -- less than the tab for building and launching a single regular satellite. Orbcomm's secret? A cheap and efficient rocket, called Pegasus, that is fired from beneath the wing of a plane. Each Pegasus can lob eight 87-pound satellites into orbit. Orbital Sciences designed and makes the Pegasus, which is the invention of Antonio Elias, a former professor at MIT. Earlier he was a student there at the same time as Orbital Sciences CEO David Thompson. When Orbcomm needed a cheap launch vehicle, Thompson consulted his old schoolmate. Orbcomm's service will be more expensive than that of rival systems -- perhaps $1 for a short message. But the satellites will provide data communications anywhere on earth. Though Orbcomm believes personal communications will be its biggest market, it has signed up customers that need to monitor equipment in remote areas. For example, Valmont, a leading producer of advanced irrigation systems, wants to put little Orbcomm boxes on sprinkler systems so it won't have to send people out to see whether they're working. The wireless device will have to be outdoors or near a window because the signal won't be strong enough to blast through walls. To compensate, Orbcomm is negotiating with cellular-phone and paging companies to find ways of meshing the networks. OTHER system builders are sure to emerge. The FCC will auction off a generous chunk of the radio spectrum next year to encourage new communication services, and some of the winning bidders will certainly enter the wireless data race. Former Apple CEO John Sculley now runs a tiny Manhasset, New York, company called Spectrum Information Technologies. It says it has a way to send data messages error-free over ordinary cellular networks. Besides sponsoring Ardis, Motorola has for years been planning to launch its own array of communication satellites. The network, called Iridium, will carry both voice and data, but it's been slow to get off the ground. Wireless data technology will make life easier, but it will take getting used to. In the early stages, systems integrators like Racotek of Minneapolis will help users through the maze of services. Racotek plans to use its own switches to route customers' messages to networks operated by Ram, Ardis, and others, depending on where the mobile addressee happens to be. That won't help you when you're sitting alone in your hotel room with a wireless gadget that isn't doing what it's supposed to do. Just try figuring out why. Is the problem in your communication software? Your application software? The network? The radio modem? The cable connecting your computer to the modem? Or have you dropped your portable on the floor once too often? The peripatetic executive will encounter some clicks and whirs on the way to tetherless freedom. But it beats sitting at a desk.