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News and comments on community broadband networks, the communities deploying them and the technologies that support them. Published by Denise Frey and Al Bonnyman.

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Tuesday, August 05, 2003

 

If satellite video scares cable operators, why don't cell phones scare landline telcos?

If satellite video scares cable operators, why don't cell phones scare landline telcos?

Here's still another story on customers abandoning landlines and going 100% wireless:

"Bye, bye landline phones: Millions 'cutting cord,' going cell phone-only"

I know the long distance carriers are very aware of competition from wireless phones with free long distance minutes (My own long distance bill has dropped almost to nothing).

But what about the Bells? Sure, they own a piece of these wireless companies, but I'd think as more people ditch their traditional landline phones and go 100% wireless, they'd get a little worried. So far they don't seem very worried according to one Verizon officer who "doesn't mind growth in cell phone popularity because it 'shows growth in the whole telecommunications pie.'"

That's more true for Verizon, the largest wireless operator, than the others, but even then, they're trading high margin landline customers for much lower margin wireless customers. For any of the Bells, at best, they're also likely losing at least 50% of these landline customers to other wireless operators.

Cable operators, always more alert to their surroundings than Bells, must love this trend; these wireless users (7.5 million in the U.S.) are probably more likely to get a cable modem than DSL when they need broadband. Then if the customer later wants a landline, the cable operator in most areas will soon have that to offer as well using the low cost VoIP (voice over IP system) voice systems they're rolling out over the next year or two.

Am I missing something here? Do the Bells have a secret plan I'm not aware of? Feel free to use the comment link below to post your thoughts.

(Link from Frank Coluccio's Technology Forum)

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