Just this month, in several metropolitan areas, users with the latest video-capable mobile phones could start watching seven television channels on their screens for free.

What's more, the latest phones are able to digitally record television programs.

"You can record 30 minutes of programming," said Taisei Hirai, a 39-year-old mulling a model of a mobile phone at a big Tokyo electronics store, his family beside him.

Consumers buy 45 million cell phones a year in Japan, and newer models are laden with all kinds of functions, including navigation tools, video cameras, digital music players and a multitude of e-wallet features that limits the need for cash and credit cards.

But what makes Japan the leader in creative uses of mobile technology is the variety of applications.

It's not unusual, for example, to see pedestrians sidle up to concert posters and use their mobile phones to read small bar codes. Their mobiles process the bar codes, automatically taking them to Web sites for more information. Viewing their mobiles, users can see prices, pick out seats and buy tickets.

Magazine ads, publicity fliers and bus stops often have bar codes that allow mobile users to arrive at Web sites to make purchases or see information.

"You're reading a catalog in the bathtub, and you say, `Oh, I want to buy this.' And you read the bar code," said Jeffrey Funk, a commentator on the Japanese mobile phone market and professor at Hitotsubashi University in Tokyo.

Last summer, Japan began to allow off-track and on-site betting on horse races from cellular phones.

Gazing into his cell phone screen near the paddock of Tokyo's Nakayama racetrack, Hiroyuki Takahashi said he was checking data about a thoroughbred online before placing a bet on his phone.

"I can find the most recent odds on the phone," Takahashi said, visiting the Web site of the Japan Racing Association.

Fans don't lose their precious seats in the stands or waste time at teller windows. Winnings are deposited automatically into their bank accounts.

Mobile betting is surging. For the 12 events on April 16 at Nakayama, one of three big annual race days, mobile betting totaled $74.5 million, said Kimio Ito, a spokesperson for the Japan Racing Association.

Online auction sites have gotten an extra boost from mobile users.

"If I want to sell this chair at my office," said Shunichi Kita, an industry expert at Nomura Research Institute, "I take a picture with the cell phone (camera), post it with my cell phone number, and I can sell it right away."

Mobile users have buoyed action on the stock markets.

"At the security brokerage services, 20 to 30 percent of trades are coming over the mobiles," said Takeshi Natsuno, senior vice president for multimedia services at NTT DoCoMo, Japan's predominant cellular service provider.

Natsuno, a Wharton MBA with an infectious sense of humor, believes cell phones will eventually replace small cash, credit cards, ID cards and keys.

Some 20 million Japanese now have newer cell phones with embedded circuitry that can function as rechargeable debit cards, credit cards or commuter passes. Electronic readers in vending machines, turnstiles and store registers beam waves that read the circuits and deduct what's due.

Already, 30,000 vending machines, taxis and convenience stores have readers for the wireless credit phones, and the number may climb to 100,000 by the end of the year.

Many businesses like the e-money system, especially convenience stores (because customer lines move faster) and the rail network (no need to count coins).

Additionally, new mobiles can function as remote controls, allowing owners to program karaoke machines, change television channels or operate a DVD player.

Five million Japanese now subscribe to television programming guides on their phones. To cater to them, leading electronics giant Sony is offering a hard disk recorder that can be programmed remotely by mobile phone.

"While you're in that boring meeting, you can see what kind of programming is on tonight, and from your mobile you can control your hard-drive recorder at home," Natsuno said.

The embedded circuitry in newer mobiles, once programmed, also authorizes entry through corporate security doors and functions as an electronic key for some homes. Once a child returns from school and flashes the phone over a reader, the phone opens the door and automatically sends an e-mail to the parent reporting his or her arrival.

Natsuno said security isn't a problem. He displayed his own mobile with a fingerprint recognition system. Other cell phones recognize voices or use encrypted ID systems.

Customers who lose their mobiles can call a number and remotely lock all functions by dialing their personal identification numbers.

"It's much safer than the wallet you have right now," Natsuno said.

Natsuno dismissed the United States as "the world's most behind country" in terms of mobile functionality. Experts once ascribed Japan's unique usage patterns to reasons as varied as having smaller fingers and longer commutes. Most of those theories have been disproved, he said.

One key difference, though, is the eagerness of Japanese carriers to provide more services to consumers without a clear revenue model, something U.S. carriers are unlikely to do. Free television for mobiles is a case in point.

"Some people now make phone calls to kill time. But if they have television, they would make fewer phone calls," said Kita, the Nomura analyst.

Television broadcasters love the service because they can boost advertising fees.

"There's silent but very harsh bargaining going on between TV broadcasters and cellular carriers," Kita said, adding that a revenue-sharing model will need to emerge.

The 86 million Japanese who own cell phones (70 percent of the population) find such features increasingly indispensable.

Many Japanese believe, Natsuno said, that "you need to carry a cellular phone. This is kind of your fate."