Landlines going the way of the Dodo


This month, Neilsen reported that 20 million homes have cut the landline cord. About 5 years ago, my friend Jules cut the cord and he, his wife, and newborn son lived in a home with a single cell phone. At the time, I thought it was quite innovative. But obviously Jules was (and continues to be) a trend setter.

On the contrary, largely due to easy access, I have installed a 15 extension phone system in the house. Now, I have to admit that had I paid full retail for my solution it would be a financially mental thing to do. But this blog isn’t as much about my phone system (more on that later) than the idea of cutting the cord as a general practice.

Neilsen reported that 17% of all homes with phones – use only a cell phone. In 2003, the estimate was only 4.2%. That’s pretty significant growth (or shrinkage), and Neilsen predicts the trend to continue. My friend Jules is an educated professional, but the growth in landline cutters is primarily in the lower income brackets.

My son tends to reach for his cell when he wants to make a call. Partly because it is already on him, partly because the numbers are programmed in it, and partly because his friends will recognize his number/name before answering. So do landlines have a chance for survival? Probably not. I put a $400 IP phone in his bedroom that can’t compete with his “free” cell phone.

For totally non technical reasons, cell phones are not good “family” phones. In fact their general appeal is when you call a cell phone you will either get the direct person you are calling or their direct voice mail box – no spouses, kids, or community answering machines. But what if you are not calling the person, but the family? Cell carriers could easily fix this with “ring all” – a family number that rings all member phones. But they don’t. Their family plans share minutes, not phone calls. In fact, the ringtone of a cell phone that can transfer calls to other “extensions” would be a death knell for the landline and PBX industry.

I don’t want to see the Landline go the way of the DoDo. But it is getting hard to defend it. It should be less than wireless, but often isn’t. Qwest offers a basic line service for less than $15/mo. But as soon as you add the $8 callerid service and taxes you are back to $30/mo again – not to mention long distance. Cell phones come with callerid, voice mail, and typically some level of free long distance. Did I mention the cell phone usually comes with a free phone too?
The other Landline problem is limited choice. There are 4 cell carriers that are “competing” for your love (during the mating process only). In Boulder, I can get landline dial tone from two companies; Qwest ($30/mo) and Comcast ($40/mo). And Comcast really isn’t even dial tone – Comcast lies somewhere between Vonage and Qwest in their technical solution.

How dial tone is delivered is not so important. In fact, a variety of IP carriers are popping up at very attractive rates. for example offers pay as you phone service for less than $5/mo with per minutes charges less than a penny/minute. Of course these lines require good broadband Internet and have limited support of things like fax machines. I have found none of these alternative services (including Comcast) to be as reliable as a basic POTs line.

I think landlines make a lot of sense. A community number for the home, reliable 911 (usually), fax and modem support, and high reliability. But at the current prices and taxes – they are making less and less sense. If you live alone, they make even lesser sense. Meanwhile cell phones are getting less expensive with better services. Perhaps something will change to reverse the trend, I hate to see landlines go, but I was a fan of vinyl records too.

The Nielsen report can be viewed here:

Dave Michels