Cell phones set to dominate US telecom industry

With Americans cutting the cord to their land lines, 2007 is likely to be the first calendar year in which US households spend more on cell phone services, industry and government officials say.

The most recent government data show that households spent $524, on average, on cell phone bills in 2006, compared with $542 for residential and pay-phone services.

By now, though, consumers almost certainly spend more on their cell phone bills, several telecom industry analysts and officials said.

"What we're finding is there's a huge move of people giving up their land line service altogether and using cell phones exclusively," said Allyn Hall, consumer research director for market research firm In-Stat.

As recently as 2001, US households spent three times as much on residential phone services as they did on cell phones.

But the expansion of wireless networks has made cell phones more convenient, and a wider menu of services, including text messaging, video and music, has made it easier for consumers to spend money via their cell phone.

"Frankly, I'd be shocked if (households) don't spend more on cell phones at this point," said Andrew Arthur, vice-president of market solutions at Mediamark Research & Intelligence.

To be sure, when corporate cell-phone use is counted, overall US spending surpassed land line spending several years ago, analysts said.

While there are roughly 170 million land lines in use nationwide, industry officials estimate there are close to 250 million cell phones.

Eric Rabe, senior vice-president for media relations at Verizon Communications Inc, said the company's wireless revenue has grown between 15 percent and 20 percent annually for the last five years, whereas its traditional land line business has been flat year to year, in large part because more than 90 percent of US households already have them.

Agencies

(China Daily 12/19/2007 page16)