IDC Predicts Weaker Economy and Rising Gas Prices Will Drive Landline Displacement

FRAMINGHAM, MA – JUNE 5, 208 – In a recent IDC survey of more than 1,500 U.S. households, people who cut the cord cited the cost of keeping both landline and wireless as the number one reason for giving up landline service. Although the number of customers without a landline has increased every year since 2004, the number of customers who've never subscribed to landline more than doubled from 2007-2008. Currently 16% of the U.S. population does not have a landline.

Many consumers would prefer a landline to cell phone as their primary phone. But the cost savings and cellular's better fit for a mobile lifestyle are driving landline displacement. IDC found cost-conscious younger consumers are more than twice as likely not to subscribe to both wireline and cellular service.

"Wireline displacement by wireless will continue to increase due to growing comfort with cutting the cord, and the cost savings of giving up wireline," said Irene Berlinsky, research analyst, Multiplay Services. "It will accelerate in the near future as consumers tighten their belts to ride out the economic downturn."

Customers who did not give up their landline cited cell phone reliability, service, reception, and quality as top concerns. Other frequently-mentioned reasons included: landline required for purchase of DSL service and/or satellite TV, landline preferred for 911 calls, the convenience of landline ringing in multiple rooms, and family (e.g., children in the house, having one number where everyone can be reached).

IDC's recently released report, Why, When, and Who Cuts the Cord: Landline Displacement Survey Data (IDC #212424), examines the reasons consumers give for dropping or maintaining wireline service, and the effect of conflicting forces that accelerate or slow down displacement. In addition to the overall numbers, the data is segmented by age and bundle provider (cable, telco, or other).

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