Kamis, 22 Mei 2008

Traditional land-line phones, once the bedrock of communications in the USA, are quickly going the way of eight-track tapes as consumers go wireless or choose Internet-based phone calling.

According to a report due to be released Wednesday by the National Center for Health Statistics, nearly one out of every six homes in the USA - 15.8% - had only wireless telephones during the second half of 2007, up from 6.1% during the same period in 2004.

"America has a lot of gabbers," says Sameer Mithal, a senior principal with IBB Consulting in Princeton, N.J. "The ability to talk on the go is what Americans like to do."

For big carriers such as AT&T (T) and Verizon (VZ), Americas love fest with wireless is having a dramatic impact on what was once a core business.

In New York, land lines have plummeted 55% since 2000, according to a new report by Sanford C. Bernstein. New Jersey isnt far behind, with a 50% drop-off.

States with the fewest land-line losses include Connecticut with 10%, Texas, 20%, and California, 21%.

Even so, it wont take long for the other 49 states to catch up to or surpass New York, predicts analyst Craig Moffett, author of the report. "This is a business that is not showing any signs of recovery," he says.

Wireless is a major factor, he says. Around the globe, consumers are clamoring for anything wireless - from high-definition video to gaming and mobile banking.

The trend is strongest among young adults: 34.5% of people 25-29 years old lived in households with only wireless phones. For those 30-44, the rate drops to 15.5%. Its 2.2% for those 65 and over.

The rise of cable telephony is another factor. Big cable TV operators such as Time Warner (TWX) and Comcast (CCW) have lured away millions of phone customers with cheap, or even free, VoIP services - short for Voice over Internet Protocol.

Verizons experience in New York reflects the trend. Long Island cable TV operator Cablevision (CVC) today claims almost 1.7 million phone customers - and has eclipsed Verizon on Long Island as the dominant phone carrier.

Big carriers such as AT&T and Verizon are stuck, Moffett says. Even though fewer people are using land-line services, carriers still have to spend billions of dollars each year to maintain the networks.

About 21% of AT&Ts annual revenue comes from the land-line business; Verizon has a bigger exposure, around 29%. The business accounts for about one-third to one-half of their profits, however, Moffett estimates.

On the plus side, both carriers have strong wireless businesses that can help offset those losses. AT Verizon is No. 2, with slightly fewer.

Verizon says its not worried. "We saw this trend coming for a long time," says spokesman Eric Rabe. Thats why the company is building an all-fiber cable network "and going after television customers."

The report from the National Center for Health Statistics - part of the Centers for Disease Control and Prevention - also found that one out of every eight homes, 13.1%, received all or almost all calls on wireless phones even though there was a land line in the home.

If the trends continue, the group said, public opinion surveys on health and other issues conducted only on landline phones could produce distorted results.


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