ATandT Dumping Land Lines Doesn't Mean Saying Goodbye, Say Analysts

 
 
By Michelle Maisto  |  Posted 2010-01-04 Email Print this article Print
 
 
 
 
 
 
 

AT&T's request that the Federal Communications Commission allow it to phase out its public switched telephone network doesn't mean that Americans will have to do without land lines, analysts say. The business could be sold to other parties.

AT&T told the Federal Communications Commission in a document dated Dec. 21 2009, that keeping up both its land-line and cellular businesses will prevent it from meeting Congress' request to extend broadband access to 100 percent of Americans in a "timely or efficient manner."

Calling the PSTN (public switched telephone network) and POTS (plain-old telephone service) "relics of a bygone era," AT&T recommended that the two be promptly retired.

"I certainly understand AT&T's desire to start the music... that will allow them to waltz away from the land-line business," Charles King, principal analyst with Pund-IT, told eWEEK. "I guess the question becomes how do you transition away-especially with a technology as critical to communications as land lines are-in a way that doesn't leave people so isolated."

News of the AT&T recommendation has raised questions about the general safety issues of relying on cellular services alone, as well as possible data security repercussions.

"There is a safety aspect to reducing the number of available networks," Ken Hyers, an analyst with Technology Business Research, told eWEEK. "In a natural disaster, redundant communications networks are important. From a safety standpoint, the more communications networks that there are, the better the chances are of making calls."

Hyers added that a land line can be particularly useful during a 911 call, when the line is tied to an address, and pointed out that in some locations cellular reception is less reliable. "Also, during high-use periods, such as during a natural disaster, a cellular network is liable to suffer from capacity issues that can cause dropped calls or make it impossible to even make a call," he said.

"That said," Hyers continued, "AT&T's role is to act as a business, not as a provider of a public safety network."

Roger Kay, an analyst with Endpoint Technologies, similarly said he sees AT&T as naturally looking out for its business needs. "I think the future, really, is in wireless, and AT&T is looking forward to stepping away from its land-line business," he told eWEEK.

While offering that "there's a lot to be said for the existing system," Kay explained the lower up-front investment that wireless requires. "Wireless is modular, so you can built it out a bit at a time," he said. "That's a pretty handy architecture."

The IRS has recommended that taxpayers calling with questions do so over a land line, for heightened security, but both analysts dismissed this as an argument.

"I'd be much more worried about somebody standing near me overhearing what I say on the phone than [about] someone [trying] to intercept my cellular call," Hyers said. "With the advent of 2G digital cell phone networks, intercepting and listening in on cellular calls is much more difficult."

Kay agreed about the difficulty of intercepting a call and then unscrambling it. It's an effort that would have to be very focused on a particular call, he said, and not an instance of casually scanning the airwaves. "I think all forms of communication can be intercepted," he said.

More pressingly, neither believes that AT&T unburdening itself of its land-line business means that Americans who want land lines will have to do without them-at least any time soon.

"It wouldn't just go away, there's a value there," said Kay, who compared the POTS situation to AOL figuring out what to do with the legacy customers who were still interested in its services, even after it was ready to move on.

Hyers added, "I don't necessarily see the PSTN being abandoned. Rather, I could see new companies being formed that take over the PSTNs from network operators and maintain the land-line networks, probably with government subsidies."

He continued, "The service would be most justifiable in regions that are poorly served by alternative communications networks like wireless and cable networks, primarily in rural areas. However ... the PSTNs will eventually disappear over time."

King pointed out that people who depend on land lines tend to be in particular areas. "It could create an interesting opportunity for local or regional carriers who would be willing to take over the service until broadband becomes available," he said, "if not as a permanent venture."

 
 
 
 
Michelle Maisto has been covering the enterprise mobility space for a decade, beginning with Knowledge Management, Field Force Automation and eCRM, and most recently as the editor-in-chief of Mobile Enterprise magazine. She earned an MFA in nonfiction writing from Columbia University, and in her spare time obsesses about food. Her first book, The Gastronomy of Marriage, if forthcoming from Random House in September 2009.
 
 
 
 
 
 
 

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