For all the industry hand wringing about Skype and other messaging providers, wireless substitution continues to be a major driver of usage decline for wireline networks. The other emerging trend is competition from cable companies, as the threat posed by the indepdendent competitive local exchange carriers clearly is lessening.
As research by The Yankee Group suggests, lots of households now originate a significant number of outbound calling minutes from mobile phones, including both local and long distance calls.
And while it is undoubtedly true that voice will in the future be tremendously enhanced in feature richness, customers today doggedly continue to buy on the basis of price and as a feature-for-feature replacement for plain old telephone service. We think people "ought" to buy because of feature richness, and increasingly they will. The problem is simply that consumers today buy for reasons they want, not the reasons we think they ought, and POTS substitution is proving quite popular.
Feature richness clearly is coming, and getting to be a bigger part of the "yes" decision for VoIP. But anybody who has worked in the business phone system business for any length of time, or been an analyst studying user behavior, can tell you that most users routinely rely on just a few features of the business phone systems.
That doesn't mean all sorts of features are unnecessary. The other bedeviling problem is simply that, like our consumption of cable TV, each viewer has about seven or eight "frequently watched" channels. The issue is that each of us watches a different set of seven or eight.
The bottom line is that simple "minute stealing" (product substitution) is going to drive most of the volume in paid minutes for quite some time.
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