Is it time to ditch the home phone?
Many households now see having a home phone service as being a habit of yesteryear, writes Rob Stock.
All around the world people are learning to live without paying for a home phone service. But New Zealanders are proving slow to follow their example, despite the large savings on offer.
Gavin Costello from 2degrees says the majority of households still paid for a traditional home phone, but: ‘‘The actual minutes of use has dropped phenomenally.’’
Figures back that up. Residential fixed-line ‘‘free’’ calling plunged from more than 5 billion minutes a year in 2008 to slightly more than 3 billion in 2014, Commerce Commission figures show.
‘‘A growing proportion of customers were reported to now rarely use their land lines for phone calls instead relying on their mobiles and applications like Skype to keep in touch with friends and family,’’ the commission says in a recent report.
Even Spark now says phone calling over landlines is a ‘‘legacy’’ product, a term usually reserved for a service a company wouldn’t be offering today, if they weren’t already doing it.
Spark’s Sam Durbin says: ‘‘Fixed access and calling is declining both here and around the world. In fact, those fixed legacy products like calling dropped below 50 cent of our revenue for the first time ever this year, which is huge considering that was essentially Telecom’s core business.’’
‘‘It really underlines the massive transformations happening at Spark but also in New Zealand and around the world.’’
Those who decide not to have a home phone service anymore often go ‘‘naked’’. They keep a landline to pipe broadband into their homes, but no longer pay extra to make calls on it from a normal home phone.
Figures from lines company Chorus indicate that in the 12 months to the end of June, 42,000 people opted to go naked – roughly the population of Nelson.
Of Chorus’s 1.8 million landline connections, 159,000 were naked.
‘‘I’m not able to share the exact breakdown of naked connections versus ‘clothed’ connections, but I can say they are popular,’’ Durbin says.
Chorus spokesman Nathan Beaumont cancelled his own landline three years ago.
‘‘It’s a definite trend, but I guess a lot of people still aren’t aware they can go naked.’’
With a mobile in every adult hand, and mobile calling costs having plunged, home phones are becoming less important, and there can be real savings for losing them.
‘‘Naked connections are around $20 per month cheaper than their clothed alternatives, and we know that many people consider their mobile to be their primary contact point these days,’’ Durbin says.
A broadband (ADSL) plan from Spark costs $89.99 with a landline, and $69.99 without.
That $20 a month adds up to $240 a year, so having a phone service and a mobile looks wasteful, if you can get by using your mobile and Skype for calling, and naked broadband for surfing the internet.
Getting rid of the traditional home phone can also mean more predictable phone bills for some. National and international calling can produce bills that vary from month to month.
To avoid that, some pay Spark between $14 and $17 a month for a ‘‘Talk it Up’’ plan to give them flat-fee calling to a different country, for example to talk to the family in Britain.
Despite the rise in telecommunication nudism, Durbin says the home phone is far from dead, and there are a number of reasons why people keep them.
‘‘The utility for the entire family is an important one.’’
This can include everyone in the household having the ability to call 111 at any time, including children too young to have their own mobiles.
‘‘Some managed services like monitored alarms or St John-style emergency buttons do require that traditional landline function that is sometimes not able to be replicated on a data or voice over IP connection,’’ Durbin says.
‘‘International calls are another draw card. Many of our mobile plans include minutes to Australia and New Zealand combined, but if you want more options we have a range of bundles and plans for the landline that can provide a good option.’’
‘‘Will your friends still call you if they have to pay?’’ Spark asks in the list of reasons on its website for not going naked.
Spark’s rivals like to play up the potential savings from opting for just a combination of mobile phones and naked broadband.
Charlene White, from 2degrees, says her parents, who run a small business, have just got rid of their landline phone.
They had been paying $125 a month for a landline and broadband bundle as well as having a mobile costing about $50 a month, White says.
‘‘They have ported their landline number on to their mobile and are getting broadband also as a package through 2degrees.’’
‘‘Porting’’ means anyone calling their old landline number will get sent through to their mobile.
Some like to keep the appearance of having a home phone, especially if they run a business from home, though it costs $20 a month at 2degrees.
All up, White says, their total spend had dropped from about $200 to $128.
Just what a household may save depends on its data and calling needs.
But complexity remains a key feature of telecommunications plans, so this can take time and be less than thrilling.