The number of wireless phone lines in Europe will soon surpass the number of landlines there.
Posted Oct 14, 2003
The number of wireless phone lines in Europe will soon surpass the number of landlines there, according to a new report, "Fixed-to-Mobile Substitution Is Inevitable in Europe, but Don't Rush It," from the Yankee Group. This does not mean that the fixed line is becoming a thing of the past--at least not yet.
The greatest hurdle currently barring wireless domination is customer behavior, according to Farid Yunus, Yankee Group Wireless/Mobile Europe senior analyst and author of the report. "Until this current generation of teens and twenty-somethings begin owning their own houses, there is a whole generation that is simply used to using fixed lines for the majority of their calls, reserving wireless usage for emergencies and convenience situations."
"Consumer behavior is very hard to change," Yunus adds.
Other barriers to a wireless world are data and security issues, according to Yunus. "Data issues will keep fixed lines firmly in place in homes and businesses for the time being," he says. "Mobile cannot compete with fixed on price or performance, especially for data. However, the crux of mobility is convenience--access anytime, anywhere--which deserves a premium price. Aggressively targeting fixed traffic would be a step toward voice commoditization."
Bringing more data-content services to market, while maintaining average-revenue-per-voice-minute is one way to displace landline dependence, according to Yunus, but, "it will be hard to convince consumers to check their email on their way home from work when they can access through landlines at home."
And how can the traditional telephone-service providers compete with the ever-growing wireless companies? Yunus says that some wired providers, who in recent years have spun off their wireless business, are getting back into the game. "British Telecom is one example of this trend reversal where companies are looking to reintegrate wireless into bundled service offerings," he says.
Yunus says that for the wireless market to keep on the upswing, revenue optimization--not landline displacement--should be wireless providers' focus.
From a customer-service perspective changing consumer perceptions, both real or imagined, of limited reliability, safety, and monetary value as compared with fixed lines will be a key driver for the industry as well. Also, creating more dependence on mobile phones through personalization tools could help spur more use within homes and enterprises, according to Yunus.
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