Monday, November 18, 2013

At Some Point, Legacy Networks are Too Expensive to Operate

According to the Federal Communications Commission, the number of landline customers in Michigan dropped from 6.7 million in 2000 to 2.6 million in 2012. Meanwhile, the number of wireless customers jumped from 3.5 million in 2000 to 9.3 million in 2012.

In other words, there were in 2012 only 39 percent of fixed lines in service; the rest were fallow. By definition, that means the remaining customers have to cover the fixed costs of the whole network.

No doubt, there are reasons some customers prefer to keep their legacy "plain old telephone service" lines. At some point, it will not be financially possible to keep the old network operating, whatever the public service value of doing so.

That doesn't mean fixed networks will not provide voice; they will. But it will be IP-based voice, not TDM. Like it or not, we are approaching a time when the legacy network has to be shut down, as it will not be possible to pay for its operation.

No comments:

Many Winners and Losers from Generative AI

Perhaps there is no contradiction between low historical total factor annual productivity gains and high expected generative artificial inte...