Electronic Design

Who's Paying Top Dollar For Comm Services Nowadays?

I’ve always felt that telecommunications cost way too much. Cell phones, Internet access, cable TV, landline phones, and other services exact a heavy toll on the average family’s budget. On the home front, providers have been sensitive to these costs by offering triple-play services. Yet on the mobile front, providers are still charging a lot for cell-phone service and Internet connectivity.

A recent conversation I had with a fellow who lost his job is enlightening. He pointed to his satellite antenna and said, “That’s disconnected. We’ve got a decent number of HDTV channels being broadcast over the air around here, so I just put an antenna on the roof.”

In other words, he no longer has to pay for TV. He also told me that he now uses Skype for his family phone. He said that he’s paying less than $3 per month for phone service! I told him that Magic Jack is even cheaper at $19.95 per year (after the first-year cost of $39.95).

Both services use the Internet, so this guy obviously has an Internet connection. But his personal “triple play” probably costs him less than $50 per month with a high-speed broadband connection. For DSL, cost is probably less than $20 per month. I didn’t ask if he still has a cell phone.

I recently ditched my cell phone. I just didn’t see the need for it. I had a family plan for two phones, which cost me about $87 per month. A couple of years back, I even contracted for mobile Internet access via a smart phone for about six months, which was another $45 per month—too much, way too much. My employer takes the brunt of the wireless service via a companyissued smart phone with Internet access. My wife gets the same deal from her employer.

According to a new survey conducted by Opinion Research Corporation (ORC) for the New Millennium Research Council (NMRC), millions of consumers are on the verge of disconnecting expensive cell-phone plans. Two out of five Americans with contract-based cell phones are likely to cut back on their cell phones to save money if the economy gets worse over the next six months.

The survey also indicates that no fewer than 40 million Americans are “more inclined today than six months ago to look at a way to save money” on their cell-phone bills, such as by switching to a prepaid cellphone service.

Cell-phone extras like Internet access, e-mail, and texting are also likely to take a hit during the economic downturn. A total of 19 million Americans—one in five cell-phone users with cell-phone extras—have “considered cutting back” (5%) or actually “have cut back” (15%) on such features “in the last six months because of actual job loss, fear of job loss, the recession, or any other related financial concerns.”

“It is important to note that these findings do not just point to a potential shift in consumer attitudes and habits about cell phones. The change in thinking and purchases is clearly already taking place and has been for months,” said Graham Hueber, senior researcher at ORC.

“For example, we see that 35 million Americans— that is, 19% of consumers with a cell phone—report that they already have ‘discontinued cell-phone service in the last six months because of actual job loss, fear of job loss, the recession, or any other related financial concerns.’ This strongly suggests that a recessionrelated shift in attitudes and purchasing habits is already underway,” he added.

I think that in the future, people will only need Internet access, which would be via a cable into the home or a 3G/4G wireless service. Finding a way to make calls and access the Internet while you’re on the go will be a tricky business if you’ve relying on a wired connection in your home.

It’s fine if your company is underwriting wireless phone and Internet service. But if not, what are your options? Wi-Fi phones might help, assuming Wi-Fi will be ubiquitous and free at some point. But what about calling from the car? Mobile WiMAX will help, but who knows what the cost will be?

If you decide on 3G/4G Internet access, via an air card, for example, you’ll have to carry a computer when you’re on the go. But you’ll also have Internet access and Voice over Internet Protocol (VoIP) services— as long as the 3G/4G service itself is available.

Toting a computer with you at all times might seem inconvenient. A mobile Internet device (MID) with built-in 3G/4G connectivity might work, though, especially if you can leverage the Internet connection for use on standard size computers, as you can do now with a smart phone. The problem is that other members of the family are left high and dry when Internet access goes out the door, so to speak. Maybe a family plan will work here.

So who’s paying for top dollar for comm services? Only those people who aren’t taking advantage of the latest advances in technology such as VoIP and overthe- air HDTV, among other things.

TAGS: Mobile
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