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A mobile phone (also known as a wireless phone, cell phone, or cellular telephone[1]) is a little portable radio telephone.
The mobile phone can be used to communicate over long distances without wires. It works by communicating with a nearby base station (sometimes called a "cell") which connects it to the main phone network. As the mobile phone moves around, if the mobile phone gets too far away from the cell it is connected to, that cell sends a message to another cell to tell the new cell to take over the call. This is called a "hand off," and the call continues with the new cell the phone is connected to. The hand-off is done so well and carefully that the user will usually never even know that the call was transferred to another cell.
Before cell phones became almost universal, the only way you could contact people when you were in public was either to use a Pay Phone, or a very expensive mobile telephone (price equivalent in the 1950s to about US$1000 to US $3000, today), and the rates then were as high as $1 a minute. They also needed so much power that you had to have them in an automobile to use them. A mobile telephone used a single frequency and did not share it. Thus for a given region - say New York City - there might only be the capacity for 30 or 40 simultaneous conversations in the entire city.
Later someone got the idea for radio telephones to have the base station that talks to all of the phones use less power, thus more base stations could be used, allowing more phones in an area. Also, for cellular phones, a lot more frequencies became available, plus phones could change what frequency they used when they were operating (which means you weren't tied to your local telephone company's network), and the capacity to make a base station's power reduced so that more base stations could be added in crowded areas, meant that the network could handle more simultaneous users. A lot more. Current Cell networks are designed with 666 channels broken into six "cells" so that in any specific cell, only 111 of these channels are used. As a phone moves, the base station tells it which of the six cell groups it will move to and which of the 111 channels in that cell to use. Think of a honeycomb, where each cell faces six others, and thus the cell concept can provide much more service than the old mobile telephone system.
Since a cell phone essentially allows the person to be anywhere, and to move around while calling, they became extremely popular for business people. The high amount of usage caused prices to drop, thus making them affordable for almost anyone. Monthly plans giving boatloads of minutes are available for rates as low as US$30 or $40 a month. Prepaid service has dropped the price to have a cell phone to less than $100 a year, with as much as a couple hours of use a year included in the price. In Israel, the price of service is so low - circa 2c a minute or less - that soldiers in the military - which is almost everyone due to universal conscription - have been told to leave their cell phones home, lest enemies use the phones to target them.