PHS or Party Henshu (Editing) System, is given to Cloud in Kalm by Aeris so that he may change his party at a save point or on the world map (given the circumstances).
The PHS is in the form of a cell phone
and rings when the player uses it. At the time in Japan
, people living there had Personal Handiphone System's, which is a cell phone. The PHS in Final Fantasy VII is most likely a reference to the Japanese Handiphone, It is also used in game a few times as a communication device, For example, when Cait Sith
(if not in the party) calls Cloud at the Temple of the Ancients