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US Phone companies shift business models

Phone Companies See Their Future in Flat-Rate Plans [New York Times: TechnologyThis is a really important shift.  The US long distance industry is shifting business models from minutes used to network access and bundled service. Verizon’s “Neighborhood” plan, introduced a year ago, now accounts for over half of all their subscribers. The telephone companies cite benefits including more predictable revenue, increased customer loyalty, and less operational costs due to the elimination of itemized billing. Telco’s see this as a way to compete with cable as well, noting that this is an opportunity to sell added services to the customer.

This is the beginning of the end of long distance.  It’s reasonable to think that in the near future there will be a day when I pay for a pipe that gives me phone, internet, television, and… who knows what else… for one monthly flat fee.  It’s the cable model applied to the telephone networks.


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