The plight of your local telephone company

Personal communications have shifted to VOIP (Voice Over Internet Protocol) and to cell phones from the plain old telephone service. This is not a temporary change, it is a permanent shift in buying patterns and it is spreading rapidly.

A telephone company has to make the difficult choice of whether they are willing to cannibalize their land line customer base or lose it to some other company. There is no other choice at this point.

This quote from a local telephone company executive tells it all:

Long distance revenue peaked in 2001, dial up revenue peaked in 2002, and basic telephone service revenue peaked in 2003.

The difference between where we were then and now is a difference of $1.6 million dollars.

Unfortunately, the situation will steadily worsen for them unless they can develop revenue from alternate sources.

In 2003, we lived in Lake Monticello, VA, and we were introduced to the Vonage VOIP service by a local handyman. He was not computer literate, but he knew that he could afford unlimited long distance and local calls for $24.95 a month.

We thought that was a financial lifesaver and did the same. We dropped our telephone bill by more then $150 by making a shift to Vonage. We kept our local land line as a backup in case of emergencies.

When we moved to Floyd, we continued the Vonage service and kept a land line out of loyalty to the local phone company, since we were dependent on their DSL service.

We use VOIP for personal and business communications and we use cell phones for backup. We require DSL, but the plain old telephone land line is an expensive luxury. The primary value of a telephone land line is to give you a listing in the phone book and not everyone wants to be listed.

If you were unsure of what a paradigm shift is, take a good look. You are in the midst of one that will have profound effects on a lot of jobs.

Like outsourcing, this is almost impossible to resist. When comparable services are available at much lower cost elsewhere, loyalty to local providers is put to the test.