HONG KONG -- In this city, restaurants are judged not only by their food, prices and ambiance. The number of portable phones spotted there is also important. The Peacock restaurant recently got a bad review.

In the portable phone category, the Peacock rated 6:10, meaning that phones had been spotted on six out of 10 tables during the reviewer's meal.

"Eek, welcome to mobile phone hell," the review said of the restaurant. But it won't be bad for business.

Hand-held cellular phones have become a way of life here. The British territory's citizens talk on the phone while dining with friends at a restaurant, watching a movie in a theater or just walking down the street.

"I was at a cinema watching 'Fatal Attraction,' " says one British resident. "Just at the tense part, when she finds the boiling rabbit, a phone rang and the guy behind me started having a bloody conversation."

The last time American tennis star Andre Agassi played in Hong Kong, one of his matches was halted after several phones rang during play. The umpire broke into a game, admonishing the crowd to switch them off.

Just five years after the first ones were introduced in the colony, Hong Kong now has the world's highest density of portable phones per square mile. Some 120,000 are in use, with an additional 3,000 to 4,000 bought each month.

Only Norway and Sweden have a higher penetration per capita. Mobile phones are subsidized by the governments there in lieu of laying land lines to remote areas.

"Portable phones have become a business necessity," says Fred Sum, marketing director of Hutchison Telecommunications, Hong Kong's largest portable phone retailer.

"People here don't stop working at 5. They continue to do business all evening. You just can't afford to switch yourself off."

But it's not just Hong Kong's hyperfrenetic businessmen who are buying them. Plumbers, carpet installers and other blue-collar workers are also seen chatting on their phones.

"Some people buy them instead of setting up an office," says Sum. "It's not a luxury, it's a business tool."

And the change coming in 1997 -- when Hong Kong returns to Chinese rule -- has, ironically, boosted rather than slowed sales.

"The brain drain {people leaving the colony in the run-up to 1997} has stimulated the market," says Hutchison Telecom sales manager Alfred Ho. "Where before a company would have 10 salesmen, now they have eight. Give those eight men each a phone and they can do the work of 10.

"Because of 1997, people are more aggressive," he says. "They want to make enough money before the Chinese come, so they need to be better equipped."

Hong Kong residents loved the telephone even before portables hit the shops. The territory has more than 2.2 million telephones, a density of 51.3 phones per 100 people.

Pagers, or beepers, are also big here, with some 550,000 subscribers receiving nearly 2 million messages a day.

Unlike other electronic and communications goods, which are usually cheaper here, the biggest selling portable phone in Hong Kong retails for about $2,600, 15 percent to 20 percent more than in the United States.

Hutchison recently introduced the world's smallest portable phone, a new "baby" model, which at 10 ounces "is no bigger than the average palm." It sells for $3,900. The "baby" phone is not as popular as the bigger model, however, because of its smaller battery capacity.

"Hong Kong has more gold Rolex watches than anywhere else in the world," says Sum, "but a Rolex can be hidden by a shirt sleeve, while a portable phone is very visible. It shows how important you are, that you need to get calls in restaurants, in the evenings."

A global marketing survey done by the advertising agency Backer Spielvogel Bates Worldwide showed that Hong Kong residents are among the most achievement oriented and materialistic in the world.

Asked if one of their most important goals was to own expensive cars and jewelry, 46 percent of those surveyed in Hong Kong said yes, compared with 34 percent in Japan, 30 percent in the United States, 24 percent in Australia and 16 percent in France.

"We have more portable phones in Japan than they do here," says a Japanese businessman based in the colony. "But the Japanese don't like to show off their wealth, so you don't see as many people using them."

Some of the managers at Hong Kong's fashionable clubs are not impressed, however, and have banned the phones from their dining rooms.

"We're a businessmen's club," says a spokeswoman at the posh Hong Kong Club in the central business district. "We don't want people shouting into their phones at lunch."

"They've been banned here ever since they became a nuisance, which was pretty quickly after people started buying them," says Heinz Grabner, manager of the Foreign Correspondents Club. "There were lots of complaints."

Before every performance at any Hong Kong classical music venue, a loudspeaker announcement tells concertgoers in Cantonese and English to turn off their phones and beepers.

"I can still hear phones ringing sometimes in people's bags, though," says a musician in the Hong Kong Philharmonic Orchestra. "It's pretty annoying."

Some restaurants make patrons "check" their phones as one would a coat.

"I was at one of the hotel restaurants the other night," recounts one Hong Kong man, "where the management had asked everyone to put their portable phones on one table.

"When the owners of the phones started leaving, nobody could tell which phone was theirs," he says. "They had to go out and phone their phones to see whose was whose."