American companies may have pioneered devices that can be used instead of computers to surf the Internet, but European companies are now driving the market for gadgets that provide electronic mail and Internet access at prices under $1000. They are targeting what promises to be a lucrative market: more than 45 million Internet appliances are expected to be sold by 2001, a market worth about $11.8 billion, according to International Data Corporation. Forrester Research predicts that about 19 million of them will be sold in Europe alone.

European households should be more receptive than American households because they have less disposable income and less space to devote to full-sized desktop computers. And with an average PC penetration of 24.3%--half that of the U.S.--Europeans are less computer literate, meaning consumers are likely to be attracted to appliances that make surfing the Web simpler.

These new Net appliances will be among the hottest items at the March CeBIT information technology trade show in Hanover, Germany, which draws more than 600,000 people each year. Among them:

SCREEN PHONES
These appliances, which offer Internet access and e-mail, may someday replace simple touch tone phones at home. Their advantages? Unlike personal computers, screen phones are always on and there is no complicated software to install or learn. Models that will be exhibited at CeBIT include Tel@phone by Matra Nortel Communications, which will offer Web access, voice mail, e-mail, and fax. Tel@phone and a competing model made by Alcatel called WebTouch both use a keypad, a color touch screen and a smart card reader. Designed to be placed in the kitchen--a convenient place to check e-mail, download recipes and shop for groceries online--the WebTouch is scheduled to begin shipping in September.

MOBILE PHONES
This year people will start using their mobile telephones for more than just chatting. The first phones able to display enough text to relay news and e-mail are starting to come off the assembly line and will be featured at CeBIT. These new phones take advantage of Wireless Application Protocol (WAP), a de facto global standard for providing information content to mobile terminals. The Nokia 7110 can access text information from the Internet via a display screen which allows viewing of different font sizes, bold or regular text format and graphics. The 7110 supports input of 34 languages, including Chinese, from the phone keypad.

And content providers are lining up to fill those little screens. Between March and June of this year, CNN will launch a wireless news service, in conjunction with Nokia, that the 7110 will be able to access. France Telecom plans to launch content services via the 7110 as well in the first half of 1999, and rival French phone operator Cegetel will compete with online interactive services for Alcatel's One Touch Pocket, another WAP-compatible mobile phone on display at CeBIT.

Sun Microsystems plans to add Java software to mobile phones, aiding delivery of these new services. Java will make it easier to download applications and content to devices made by different manufacturers. New services won't be the only thing at mobile users' fingertips. Siemens is announcing new "Fingertip" technology which should be integrated into mobile phones next year. Fingertip is designed to prevent unauthorized use of phones, computers or even cars. The rightful owner briefly taps a sensor with his finger and the connected microchip knows whether to allow him access to the device, based on his individual fingerprint. James Bond would approve.

HAND-HELD COMPUTERS
The U.S.-made Palm Pilot remains a popular choice, although a version offering Internet access is still in the prototype phase and won't be shown at CeBIT. But European manufacturers, who have come up with their own versions of organizers and hand-held computers, are ready to go to market with Web-connected devices. At CeBIT the U.K.'s Psion will be showing its Series 5 organizer, which offers Internet access and e-mail and fax capability via regular telephone lines or mobile phones. Dutch consumer electronics maker Philips will show off a Web-enabled version of its Nino organizer.

Perhaps the most ambitious product in this category on show at CeBIT is Siemens' Personal Intelligent Communicator. Packed into a pocket-sized 3.4 cm by 18.6 cm by 10 cm box, the PIC can make phone calls, send and receive e-mail and fax and surf the Internet. It also can use popular software programs including Microsoft Word, Excel and PowerPoint, and can synchronize calendar information, address databases and documents with your home or office personal computer.

SET-TOP BOXES
WebTV is finally set to come to Europe. Philips, which produces the hardware for Microsoft affiliate WebTV in the U.S., plans to show off the Internet TV set-top box it will sell here when local operators introduce WebTV services in the second half of the year. Digital set-top boxes that will provide interactive services and Net access via TV sets made by manufacturers such as the U.K.'s Element 14 and Finland's Nokia will also be on display.

NET COMPUTERS
These devices, the least popular Internet appliances, according to analysts, have yet to find their niche. But manufacturers keep trying. For example, Siemens' new Scovery 211 and 212, on display at CeBIT, combine the latest features of the PC environment--which includes the Linux operating system, an Internet browser and a fast processor--with the features of a dumb terminal that stores information in the network rather than on the computer. Network computers can be assembled more cheaply than PC's because they don't need disk drives to store software--their files and programs are stored on servers operated by service providers, such as telephone companies and other types of Internet providers, and are then transmitted to users over the network as needed.