"The largest U.S. wireless carriers are working on ways to keep their customers paying up for something they do less and less — making phone calls," says Greg Bensinger at The Wall Street Journal. The smartphone era has made traditional phone-calling almost quaint, with consumers increasingly opting to communicate via text, email, or Skype. The shift poses a huge problem for phone companies, whose earnings from data usage are "dwarfed" by revenues from calls, says Phil Goldstein at Fierce Wireless. Here, a guide to how carriers are coping with the decline of phone calls:
Are people really making fewer phone calls?
Yes. The number of phone calls has been on the decline ever since Apple introduced the iPhone in 2007. In 2006, the average phone call lasted 3.03 minutes, compared with 1.78 minutes at the end of 2011, says Bensinger. Consumers spoke on their phones for an average of 826 minutes per month in 2007, which fell to 681 minutes in 2011.
How are carriers responding?
Instead of allowing subscribers to choose from different voice plans, carriers will "replace them with a flat rate covering unlimited calls," says Bensinger. The move will eliminate "what can be a confusing array of options," while also keeping "a cash cow healthy by depriving customers of the option to trade down to cheaper plans." For example, T-Mobile currently offers a 500-minute plan that costs $40 a month — a new plan for unlimited minutes would presumably cost more than that, even if customers hardly make use of their phone time.
When will unlimited voice plans be introduced?
The major companies, such as AT&T, Verizon, and Sprint, say no final decisions have been made, but "they certainly seem to be angling in that direction," says Goldstein.
Will consumers embrace the change?
Probably not. The companies are basically "charging you more for less," says Joshua Schmell at Macgasm. Locking customers into a scheme — "and it sounds like a scheme through and through" — will only push them to "change their habits to ensure they're paying less for their bills." Some industry insiders predict that new carriers will emerge "in the next two years with cell-phone plans that cover only data, no voice," says Bensinger.
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- Why you should stop believing in evolution
- Why China thinks it could defeat the U.S. in battle
- 10 things you need to know today: August 20, 2014
- The secret to handling pressure like astronauts, Navy SEALs, and samurai
- What the 'death of the library' means for the future of books
- Why your employer should clean your house and do your laundry
- What you need to know before you support the police in Ferguson
- The real lesson of Rick Perry's mug shot
- Welcome to the age of ambivalent feminism
- What would a U.S.-Russia war look like?
Subscribe to the Week