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By most measures, smartphones are already pretty cool. They can take calls, play music, give directions and entertain us with an endless number of time-wasting apps.

But they could soon become much cooler, thanks to technology that can give them and other computers the power to anticipate what users want and be intuitively responsive to their needs.

It's called context-aware computing. Small sensors harness information about a user's location, preferences, environment and other variables.

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A smartphone could generate restaurant recommendations in a new city based on a user's dining habits and neighbourhood preference in his or her hometown. A television remote control could offer program recommendations based on who is holding it. Search engines could display more accurate results based on a person's browsing history.

Context-aware computing has been around for decades, but it's been gaining steam as costs fall and computing technology becomes widespread. But it also raises serious questions about privacy that experts say must be addressed as these systems come to our homes and offices.

Research firm Gartner Inc. predicts it will be one of the biggest technology trends of 2012 and says that by 2015, context-aware systems will account for $96-billion of annual consumer spending, with 40 per cent of smartphone users around the world choosing to use services that track their activities.

These systems could also transform the way businesses engage with clients and employees as well as make companies more efficient and better places to work.

The possibilities are seemingly endless. Companies could improve customer service by providing product suggestions for clients based on their purchasing history, location and other preferences. Mobile phones or wearable devices containing sensors could be used to track what people are eating and how much exercise they are getting in order to improve their health.

"It's astounding and enabling," said Ted Selker, associate director of mobility research at Carnegie Mellon University Silicon Valley and one of the foremost experts on context-aware computing. "The question really comes down to what won't [mobile devices]be able to do."

One way these systems will change the way we work is by making mobile devices more context-aware. Dr. Selker predicted. Sensors will detect a person's location, the time of day and the presence of others to tell whether a person is in a meeting or listening to a presentation. If so, it will dismiss incoming calls or revert to silent mode.

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These systems will "have to be aware of the cognitive load they are creating for people, and the openness the person has at that moment, to listen to anything, to look at anything or to do anything," Dr. Selker said.

He has created context-aware employee identification badges that monitor a person's location and automatically send calls to his or her mobile phone if the individual is on the move.

Identification tags could let employees know the location, and even the state of mind, of their colleagues and advise on the best means to communicate with them. Similar systems could use information about an individual's schedule to conserve battery power during non-working hours.



However, context-aware computing also presents serious privacy challenges. How will sensitive data gathered by devices be protected? How much information should users be willing to surrender to their mobile devices in order to get better service?

"There's a sort of balance there," said Charles Clarke, professor of computer science at the University of Waterloo. "You don't want to tell every app and every developer of every app everything about you, even if it's going to help you."

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