Cancer scare rattles cellular phone industry Investors rush to sell shares

January 30, 1993|By New York Times News Service

NEW YORK -- It began last week, when a Florida man said on a national television talk show that his wife's incessant use of a pocket-size cellular telephone had led to her fatal brain cancer.

The next day, stock market investors, putting their faith in the man's story -- or fearing that others would take it on faith -- began dumping cellular telephone stocks. The cellular industry scoffed at such a wild notion and defended the phones as safe.

But yesterday, it became clear that the issue would not go away. Wall Street continued to batter the shares of companies involved with cellular phones, the kind that have antennas next to the head and allow users to make calls from just about anywhere. They are different from cordless phones that broadcast a radio signal only a short distance within the home.

The shares of Motorola Inc., the biggest maker of cellular phones, have lost 20 percent since the scare began. McCaw Cellular Communications Inc., the largest provider of cellular service, has seen its shares skid 15 percent, including a drop of $3.375 yesterday.

All week, the companies have rushed to insist that there is no scientific evidence of danger in using the phones. But scientists say that no one really knows for sure.

Although there is no proof that there are health risks, there is no research that specifically addresses the effects of cellular phones on the human body and the human brain. Even the Environmental Protection Agency says it does not have enough information to declare unequivocally that cellular phones are safe.

Some of the more than 10 million people who use such phones in the United States have begun to question whether they need them. Potential customers, who had been signing up at a rate of more than 7,000 a day, are now asking dealers pointed questions or delaying purchases. Rep. Edward J. Markey, a Massachusetts Democrat who is chairman of the House Energy and Commerce subcommittee on telecommunications, has asked two federal agencies to determine what the government knows about cellular phones and any possible link to cancer.

Yesterday, the Cellular Telecommunications Industry Association, a trade group based in Washington, said it would finance research into cellular phones and that it would ask the federal government to appoint an independent panel to review the research and findings.

So far, the health scare's impact on sales is hard to detect, according to retailers and the operator of a major cellular telephone network. Among 2 million subscribers on the McCaw network, only 300 to 400 have called to inquire about the possible health danger over the last week or so, and fewer than 30 have canceled their subscriptions because of health concerns, said Robert A. Ratliffe, a McCaw spokesman.

Still, the concern is not tapering off. On Thursday evening, two more television programs, CBS's "Street Stories" and CNN's "Larry King Live," focused on cellular telephones and safety, with ABC's "20-20" scheduling a segment for last night.

The shows broadened the furor to the controversy over the effects of electromagnetic fields. Not only cellular telephones emit such fields, but also electric hair dryers, microwave ovens and the overhead transmission lines of giant electric utilities.

Scientists are divided over the malign effects, if any, of these fields, and if the science is murky, so is public understanding, especially when it comes to panic-inducing words like radiation and cancer.

Cellular phones work at very low power, about six-tenths of a watt, which leads many scientists to insist they are unlikely to cause much harm. But the devices are held right up against the head, and there have been several disturbing studies that have helped roil the waters.

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