Out with the Old Landlines, In with the New Broadband

In 1893, historian Frederick Jackson Turner wrote that the American frontier had closed, and America was entering a new world — one that would become more centered on industry and technology rather than the availability of land. Something of the same thing has just happened in how Americans communicate.

Since 2004, the Centers for Disease Control and Prevention has been tracking cellphone and landline use as part of its National Health Interview Survey. (Why CDC? Because the ability to communicate effectively with doctors and other healthcare providers is an important part of maintaining health.)

The survey found what many of us have long suspected: landline phones are dying out. Now, a majority of U.S. households have only mobile connections, rather than a landline as well or a landline exclusively. As the chart shows, the decline of the landline phone has been rapid and unrelenting.

But that’s how technology transitions work. A new, better, more functional technology rapidly replaces the old — and the pace of change in these transitions continues to increase along with the volume of change. Here, broadband is replacing “plain old telephone service.”

This means, among other things, that mobile and broadband-based services are the clear choice of the future rather than the old copper-based services. To make this transition complete and to respond to consumers’ clear choices in favor of the newer systems, the country needs greater investment in mobile and broadband rather than antiquated copper-based services that fewer and fewer people use. It makes no sense to require investment in these old systems if demand will not be there in the future  — better to invest in expanding and improving higher-speed broadband.

But in case anyone still doubted which way the trend was heading, here are the numbers, just as Turner had his figures available in 1890 to present his case. But there is one big difference in the shift in telecommunications today: unlike in Turner’s thesis, the switch to broadband opens a new frontier in communications and information, while the old technology, which once seemed to offer limitless potential, in fact constrains economic growth. Investors and regulators should take note.