Smart cards, the ones with a true computer chip on them, never really took off in the US, at least not for credit cards. They are very popular in Europe. The primary reason is that way back when, the US telecom landline system was much more advanced than Europe's when credit cards were becoming widely used. So it was easier for a US merchant to verify the authenticity of the card via phone than for a European merchant.
Instead, European companies like Gemplus created smart cards with a tiny computer chip on it that could be used to verify the validity of the card (via PIN). So for transactions up to a certain amount (set by the card issuer and merchants), this PIN validation would be satisfactory and not require a phone call. Anything above that amount would require a call, thus drastically reducing the number of calls.
The primary US companies to try smart credit cards were the Amex Blue and the Target Visa. The Amex Blue was popular only because of its unique look, not really the smart chip on it. I don't think Target Visas have the chip on them any more.
As you can imagine, a smart card is many times more expensive than a traditional magstripe card. They have not taken off in the US as credit cards b/c of the massive cost in infrastructure that would have to occur (new readers to all merchants, etc.) Rather than pay this cost, the issuing banks would rather deal with the higher amount of fraud that occurs with magstripe cards. They lose billions of $ a year to fraud, but feel that is less expensive than paying for the infrastructure. And this doesn't even factor the demand, or lack thereof, for smart card readers on home PCs. In fact, I have a reader in my laptop, though I have no idea what I'd ever use it for.
The one place where smart cards have been successful in the US is for SIM cards for cellphones. If you have a GSM phone, you have a SIM card. Changing the SIM card completely changes the user and phone number of the phone.
Smart credit cards, b/c of the sophistication of the chip, are many times more expensive than SIM cards too.