This story appeared on Network World at

This story appeared on Network World at
http://www.networkworld.com/columnists/2008/040808-bradner.html

Telephony: creeping disconnection

Still more people dropping their landline phones

'Net Insider By Scott Bradner , Network World , 04/08/2008

Each new survey shows that the number of people who have forsaken their traditional landline phones keeps growing. This, coupled with changes in the way people use cell phones, is starting to impact a number of areas in ways that people might not have expected just a few months ago.

Market research company Harris Interactive recently published results of its survey on cell phone use. The results were similar to those from a recent Centers for Disease Control and Prevention (CDC) survey (see "The missing phone device and the IRS"), with the only major difference being that the number of people who had dropped their traditional landline telephone
increased to about 21% (the CDC survey had 12.6% of U.S. adults living cellphone-only households). There may be some skew because the CDC report considered households and the Harris survey deals with individuals, but the trend is still clear. More and more people, particularly younger people -- about a third of 18 to 29-year-olds, for example -- are moving away from the tether of a landline phone. Most are just using a cell phone, but some (about 15%) are using various Internet-based VoIP services. In addition, only about 9% only use a landline -- half of what it was a year before.

Meanwhile, cell phones are getting smarter. ABI Research reports that the percentage of cell phones classified as "smartphones" is poised to grow from 10% of the market today to about 30% in 2013. The biggest push in this space comes from the fallout of the iPhone, with a number of direct iPhone competitors showing up at CTIA Wireless 2008 (see "iPhone clones attack CTIA!"). Smartphones, led by the iPhone, are changing the sort of things that people in the United States use phones for. (I say "in the United States" because many uses that are just starting here have been going strong for quite a while in other parts of the world.) M:Metrics is reporting that iPhone users are employing their cell phones more like normal PCs than users of other types of smartphones, and it is reasonable to expect that users of at least some of the iPhone clones will continue this trend. This, of course, will have a major impact on the traffic patterns in cell-phone networks and could lead to significant congestion in parts of some carrier networks.

A Verizon report comes to a different conclusion while not changing the facts all that much.It says that "an overwhelming majority (83%) of landline owners plan to keep their landline indefinitely." It might be reasonable to take the Verizon report with a grain (or pound) of salt considering that Verizon just sold (or spun off) all of its landline business in northern New England to a new company. It seems that even Verizon does not see that much of a profitable future in old copper. I fully expect that the continued move to cell phones and away from landlines will cause more moves of this type since the preponderance of landline users will soon be people who have the landline only as a backup -- and backups of this type are not good revenue generators.

Disclaimer: Revenue, as you might expect, is a big deal at Harvard. But I have no idea if any of Harvard’s revenue comes from telephone landlines, so the above analysis is my own.