The Future Of Home Phone Lines

There are many publications covering the voice over IP (VoIP) industry. One of the better industry publications for reviewing trends and seeing some “real analyzed” industry stats is: IP Business News, edited by Gary Kim.

A recent article discusses the large number of home phone lines that the big incumbent phone companies are losing. Contrary to what many think, these lines are not all lost to mobile phones.

The article addresses a survey conducted by the Yankee Group showing that “Many consumers are not getting rid of their home phone but instead are switching to alternate or lower cost residential phone services.”
Patrick Monaghan, the Yankee Group senior analyst who conducted the report, concludes that “voice has become commoditized” since VoIP (and especially the triple play offered by the cable companies) is eating into the incumbents business.

Indeed cable companies will be doing the heavy lifting of replacing the main phone line dominated by the incumbent phone companies. So what is the faith of pure VoIP home phone services? So much has been written about how the battle has been lost to the cable companies and as a primary line replacement for most US homes it is indeed going to be the case.

However, there is still much room for pure VoIP home phone solutions. And NOT only as we see them today. As the article continues, solutions such as Skype are meant mainly for international calls and not for domestic calls.
Not the cable companies and not Skype like services can really replace the little box as a second, or third line, that can be moved from one location to another and allow one to keep their service at a much lower price then any cable phone service as well as offer many features that are not offered by the traditional phone companies (including cable solutions).

Also, for a very large, and growing, community of expatriates allowing their relatives to have a US phone line is a great benefit and the simplicity of the experience will have value for years to come.

The main issue this article debates is (as the title: “Cord cutters or Switchers” suggests) whether the Yankee Group conclusion is accurate? Is voice really a commodity?

Well, perhaps it is really just a matter of definition since voice (I guess VoIP) has a long- long way to go with innovation(s) and it is wrong to distinguish between wired and wireless voice with all the new ways to communicate (…as in TALK…).

Quoting Kim: “the ability to use one’s services, anywhere, any time, any place, on any device will require an enormous amount of “non-commodity” effort, probably will be highly personalized and customized, and will be priced like other products that are highly customized”

Whether prices will be high or low will depend on the market and not only on the level of customization (in many cases much of that customization will be shifted to the end user) and whether the service will “arrive” over wired lines or new broadband wireless solutions will also matter less.

We are finding that with so many solutions out there we still don’t have a “one size fit all” solution. We don’t remember phone numbers any more but we also use many phones and many phone numbers. New solutions are consolidating that.
We are nearing the time when we all have one number to hand out and be reached anywhere and anytime we want.

Kim presents AT&Ts position that same services will be offered regardless of mode of access. Question is what are these offerings? Who will offer the and when will they come?

Well, some are here already. One can already enjoy a service where one number is used to call a land line or a cell phone (see Phone.com Virtual Office as an example) and much more will come in the next year or two. Mobile providers are offering more broadband voice services and some are also trying to offer landline services (see T-Mobile’s $10 a month home phone pilot as an example).

To summarize: though this may have turned out somewhat of a synopsis of the IP Business News story. Two points that we need to remember:

  1. Voice (VoIP technology) has a long way to go for innovative services.
  2. One will be able to use his/hers own personal VoIP services over wired, wireless or broadband connections.