Wednesday, July 13, 2011

Going Wireless for Everything

For some time I've been observing the potential for the disintermediation of cable offerings by less expensive alternatives. My focus had been primarily on cable-provided television, which has become much more significantly affected among younger adults.

However, in the past few weeks, I've had personal experience and talks with friends involving cutting various wired communications or entertainment services to go wireless.

For example, a few weeks ago I finally terminated my landline telephone and associated ATT long-distance service. I'd had that phone number since 1999, but, increasingly, it was turned off and disused. My cell phone provides effectively free long distance, while the landline's total monthly costs, including long distance, mostly due to legacy regulatory fees and taxes, was in the neighborhood of $40-50.

I don't actually know of a single adult, including those, like me, over 50, who has moved within the past two years and installed a landline telephone. Not one. One squash partner is now considering following my lead on dropping his landline, since he's become angry with Verizon's forcing him into Fios at much higher prices than he used to pay for phone and internet.

Next, a cycling partner asked me about alternatives to cable television, as she feels she gets virtually no use from it at all, for about $60/month. As one of the few subscribers to AppleTV, considered a failure even by Steve Jobs, she often watches "tv" with her daughter on an Apple laptop propped up on their dinner table. Her daughter finds various sources for content- Hulu, YouTube, to name just the most obvious two.

We discussed how she could buy a high-end Tivo with web access, connect it wirelessly to her internet service, and obtain her movies and older television series content via Netflix through the Tivo. Plus directly access all the websites from a television, rather than the Apple laptop.

Then I ran into a squash friend with whom I discussed dropping landlines. She wasn't so fixated on cable television, but asked what I thought could be options for dropping her high-speed cable internet service. She confided that both of her sons, who are on the same wireless plan with her, use their Android cell phones for internet access, in effect making them cellular modems for their laptops. I agreed that she could just do that and save those monthly charges. She has an Optimum Online triple play package for about $150/month, so dropping the phone and internet may save her more than $100 of that.

I related the conversation I'd had with my other friend about dropping cable television, and this friend thought about that, as well. Overall, she could recover the full $150/month from Optimum and simplify her life, as she prepares to return to Canada in the next few years. Further, she noted that she didn't need a Tivo to get Netflix, since her kids had left a PS3 at home, which now serves as a platform for Netflix, as does the Wii.

One woman I know who moved into an apartment last year after a divorce skipped the landline and internet access, simply searching for other wireless signals in her complex rather than paying the $60/month for said connectivity.

It's expected nowadays that 20-somethings use cell phones and whatever internet connection they find at work or in their neighborhood to save on cable, internet access and conventional telephone expenses. But I think it would surprise many strategists at Comcast, Verizon, Cablevision to discover how many older, well-educated, higher-income adults are cutting as many cords, cables and wires as possible in their homes to save money and consolidate communications and entertainment budgets. I suspect it's happening among older Americans of that segment far faster than was forecast perhaps even just a year ago.

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