Phone giants want to cut landline
Chicago — – The Illinois Telecommunications Act is up for review this spring, and big phone companies are expected to push to eliminate a legal obligation to provide landlines, which are still the cheapest and most reliable form of phone service.
In a measure being pushed by big telecom provider AT&T in states across the nation, consumer advocates say, the phone company wants to eliminate the act’s “obligation to serve” requirement, which gives everyone in the state the right to landline service.
That would open the door for phone companies to abandon areas they deem unprofitable.
Illinois still is home to about 1.3 million residential landlines, which is costly for service providers like AT&T and Frontier. It means maintaining copper wires, often in far flung areas, for a service that is increasingly disappearing.
Jon Banks, senior vice president of law and policy at USTelecom, an industry trade association, said in the past four years in Illinois, traditional phone companies have lost a large portion of market share. In 2008, those phone companies served 58 percent of households. In 2012, that dropped to 29 percent.
At the same time, the share of Illinois households that rely on wireless service jumped to 43 percent from 23 percent.
For consumers, landlines are the most inexpensive form of phone service. The lowest cost options in Chicago start at $3 per month, according to the Citizens Utility Board. In more rural areas, prices start at $9.50 per month for local service. If providers succeed, landline customers could be forced to sign up for pricier alternatives — such as wireless service or broadband Internet to have access to a traditional telephone.
“Smartphones are wonderful technology but they don’t come cheap and anybody who has traveled across Illinois knows they’re not always reliable,” David Kolata, executive director of Citizens Utility Board, said at a recent news conference. “Traditional home phone service is the most affordable, reliable option for millions of people and we shouldn’t take away that choice.”
In California, where the telecom industry succeeded in its lobbying efforts, AT&T flat rate service increased 115 percent to $23 per month in 2013 from $10.69 per month in 2006. Verizon increased 27 percent to $22 per month from $17.25 per month, according to Keystone Research Center, a Pennsylvania policy research group.
That has consumer advocates concerned that rural areas where cellphone service is spotty could be unduly punished and residents with medical alert bracelets and other medical devices tied to landlines could be in danger.
In January 2014, the FCC agreed that the world is moving away from landlines.
In announcing that it would allow telecom providers to pilot programs that experiment with landline-free areas, FCC Chairman Tom Wheeler said in November 2013, “The way forward is to encourage technological change while preserving the attributes of network services that customers have come to expect.”
According to a 2014 report by the National Regulatory Research Institute, 13 states have legislatively withdrawn “carrier of last resort” obligations, all in the AT&T territory. Other states have rewritten the law to allow landline carriers to petition to withdraw the obligation if the service becomes “obsolete” or are allowing telecom providers to discontinue the service in certain areas.
With the FCC’s permission, phone providers have been conducting pilots in various areas of the country to see how residents fare without landlines, switching residents over to Internet-based phones and those that wirelessly connect.
Sherry Lichtenberg, principal telecommunications researcher for the National Regulatory Research Institute said there are still some attributes that landlines have that other options do not. Landlines work even when the power goes out, work with medical monitoring devices and can reliably pinpoint your exact location when you call 911.
“They say they won’t force anyone off a landline until they can fix those issues,” Lichtenberg said.