T-Mobile has begun testing a new landline VoIP offer in a couple of US cities, offering unlimited calls for $10 a month (consumers have to buy a $50 Wi-Fi router that’s got some jacks for the landlines, and of course, supply their own broadband connection). A further sign of how mobile operators are racing to the bottom in terms of pricing. While this is just a trial, should T-Mobile roll it out nationwide, it’s easy to see them bundling it in to their recently announced $100/month unlimited mobile plan.
It’s sort of hard to get too excited about developments in the landline space, but this is pretty amusing. What really makes me smile is that operators like Verizon and AT&T — whose parent companies are legacy landline telcos — have touted their ability to offer consumers bundles of services, combining landline and mobile service as a key advantage. T-Mobile has no legacy landline infrastructure, but that’s a benefit rather than a curse, since they can instead offer VoIP service more cheaply than the incumbent’s landlines. It’s also interesting from an FMC standpoint: once T-Mobile gets its router into customers’ houses, getting them to start using its Hotspot @Home service for Wi-Fi calls becomes a rather simpler upsell.
Still, the landline’s days are numbered. That said, I’ve still got one from the cable company, mainly so I can send and receive faxes — another technology that, despite its shortcomings, remains annoyingly in use today. But if T-Mobile made this service available nationwide, I’d probably take the plunge, and I imagine many of its other customers — or at least those who are hanging on to their landlines — would as well.
So, the market seems to be dictating a price of $100 per month for unlimited mobile service, and $10 per month for unlimited landine service. But watch this space, as those are going to fall quickly in the coming months.
I would also take the plunge, add hotspot wifi service and get a wifi phone as well… Right now I’m sitting on the fence debating if I should hotspot or iPhone.
Hi Carlo
Interesting. It’s only really the US (OK & Finland) that take a sort of philosophical view that “cutting the cord” is somehow the way of the future.
I’m seeing an increasing realisation that actually fixed-line telephony (or more importantly fixed VoIP) has a permanent role in many contexts. It has different use cases, different psychological connotations and I cannot see it disappearing, especially in countries outside the US where fixed & mobile numbers are visibly different.
In particular, there is a strong rationale for places having numbers, as well as people. I really don’t want the cellphone number of the guy who cooks pizza, I just want the number of the pizza store itself.
Dean
You still need a home number, so people can call your house/family instead of just you. With only mobile numbers, communication gets atomized. It’s good to call someone’s house and have their partner/friend/kids pick-up… then you get to say hello to them as well.
My wife won’t let me cancel the house phone, even though it doesn’t get used much. It’s re-assuring to her that we have it.
Hi Dean,
I think you’re probably right, that I have overstated things a bit. I was thinking about this some more over the weekend. There is a clear trend of fixed-to-mobile substitution among younger people — but what happens when those people grow up and have small children, for instance? Do you revert back and get a fixed-line family phone at the house? What about kids who have grown up with mobiles, will they ever see a need to get a fixed line at home? Or what’s the alternative — shared mobiles, or fixed terminals that use the mobile network?
Indeed, as you cite, there are plenty of cases where a fixed-line makes sense, particularly in business. I think I could have worded things better, perhaps, to say the days of old-styled copper landlines are numbered. But with prices dropping so far so fast, it’s clear that the fixed-line phone business, especially the residential business, is in for some serious disruption.