There is a difference of enjoying each other's company while being quiet and being rude while ignoring someone else. I wish some very talkative person wanting me to entertain them on the bus could have been entertained by their phone. I've often used books/ereaders/phone to keep others from talking to me (and enjoying reading of course). I think one major thing to discuss is not how much we're being distracted by technology, but more of how much priority we put on socializing face to face.
Nobody pulled out the newspaper during a meeting or a meal and pretended they were paying attention while really playing a game or reading some trite.
I also remember that everyone had their own kind of 'roughly tablet-sized' time waster, including crossword books, Reader's Digest, novels, magazines, and yep, even TV Guide.
Over the years this had expanded to portable game systems like GameBoy, virtual pets like Tamagotchi, the original push e-mail devices like BlackBerry and so on. Hell, even when Timex came out with Indiglo watches I remember people used to pull out their watches and compare backlights the way people started to do the same with ringtones on feature phones.
However the modern smartphone is the amalgamation of all of these things into one. So in one sense the smartphone is really just an all-in-one version of the separate time-wasters.
The key difference that I see isn't just that "after you read the paper for the day, that's it, it's done" (and I do agree with you on this point), it's that the mobile phone (especially the smart phone) also enables a new application that wasn't previously possible: engaging in conversation with someone else than the person(s) you are physically next to.
No previous method of communication was portable like this with the potential to allow you to bypass a physical conversation so easily. And on top of that, since the phones have access to so many social connections, people seem to have unlimited opportunities to engage in long-distance conversations while ignoring those present physically.
But someone else rightly pointed out in another comment that the problem isn't so much that this is possible, but that our social norms haven't updated to make this a truly rude act. I just went to our friends' American Thanksgiving party and watched many conversations halt at any incoming mobile phone notification. Which I find doubly-rude: that the conversations on the phone seem prioritized over finishing an in-person exchange?
I think the best thing we can do is to just own the device we like, and practice the social etiquette that we hope others adhere to as well.
The thing I find interesting is watching the different types, like for example, very early in the morning you get 'lower' class workers with a standard tabloid newspaper and overalls. The closer it gets to nine, the more they look like managers or office workers, and the more focused they are on their gadgets.
They are different social methods rather than one being anti- and one being pro-social [did I make that word up?]. However direct local conversation seems more social [to me] for sure.