Wireline: Is the end near?

Source: Allied Telesis

Gary Kim has an interesting article on the decline of wireline telephony. We all know that fixed line for the typical home is declining as frankly fewer people are actually making phone calls and those that are made are via mobile. The CTIA organization figures 31% of American’s 110m households are now wireline free (around 35m).

The FCC report that Gary references, indicates that year over year, the fixed line numbers have decreased 3%. This is a bit slower than previous years, but a decline nonetheless.  If you extrapolate the data and assume this moderate decrease continues, by 2022 the US will have only 55m wirelines left, a decrease of 43m lines from today’s 98m lines. The compounding factor of this slight decrease would result in a decline of nearly 44% of total wireline access.

With the advent of more “VoIP” non-telephony calling applications, the impact to business is similar. Businesses will need fewer trunks to their PBX since there will be fewer calls. Slowly the office PBX starts to look like yesterday’s payphone. Slowly PBX phones aren’t on every desktop and eventually the day will come that the notion of an office telephone is simply a fond memory.

A bigger question is whether this 3% decline percentage remains steady. At some point, service providers will find the cost of maintaining aging systems and switches to be exorbitant and the ability to further maximize efficiency (meaning with less staff) become difficult, if not impossible. Is there in fact another major decline ready to happen?

Thus what will be the tipping point where operators simply try to shed this business. Perhaps selling it off (as Verizon has done with some properties) or urging users to transit away. While old telecom guys (the Joe “Donuts” of the world) may shed a tear about the good old days. With every death, there is a birth. Companies will still need to be reached, employees will still need to communicate and sisters will still need to talk.

While we can all agree that wireline is declining and argue about the date of the last heartbeat. The real question is what is the fate of traditional mobile voice? With declining Minutes of Use (MoU) on the mobile networks, are we talking less or talking more on other applications. Some follow-up is required