The cost of a landline phone is rising at an alarming rate with no sign of slowing down, and businesses face a choice. Landline customers are experiencing drastic price hikes and service decommissions due to incumbent local exchange carriers (ILECs) transitioning away from copper-based plain old telephone service (POTS) and time division multiplexing (TDM). POTS and TDM rates have risen severely, with some businesses now facing monthly fees of over $1,000 for their landline phone service. So business landline customers must decide whether to stay with their existing service and pay high prices or switch to another provider.
The Cause: Regulatory Changes
These price increases stem from the Federal Communications Commission (FCC) permitting carriers to adopt market-based pricing for copper services. In August 2019, the FCC granted ILECs forbearance from obligations restricting their copper policies since 1996. The forbearance memorandum lifted price caps, enabling carriers to develop new and improved services.
Although the Commission set a deadline of August 2022 for carriers to switch their analog services to alternative options, this did not entail the immediate decommissioning of all POTS lines. However, some carriers are not waiting, and AT&T has been switching off 700,000 POTS lines monthly. The new regulations signaled that costs for landline phones would soon rise, and with carriers moving away from POTS now and in the future, the phrase “landline costs are going up” is becoming a significant understatement.
Copper Wires, Customer Woes
With pricing forbearance, carriers can now charge the actual cost of landline phone service. As more businesses abandon POTS, fewer users bear the cost of maintaining, repairing, and supporting copper wire technology. Consequently, some POTS customers face enormous increases in their telecom expenses.
As landline phone costs surge, support for the technology dwindles. customer experience representatives and technicians familiar with copper wire are migrating to other technologies, and replacement parts and equipment are becoming scarce. Some customers experience long waiting times for phone support and struggle to secure service appointments, with scheduling delays extending from days to weeks in some instances.
Given these challenges, what alternatives are businesses exploring to replace their landline phones?
Landline Phone Alternatives: Embrace the Cloud
Businesses seeking alternatives to landline phone service are increasingly turning to cloud-based business communications, with most considering Voice over Internet Protocol (VoIP), Unified Communications as a Service (UCaaS), or Contact Center as a Service (CCaaS).
VoIP: Voice over Internet Protocol is phone service hosted by a third-party provider that allows users to make phone calls over the Internet, bypassing traditional phone lines.
UCaaS: Unified Communications as a Service is a cloud-based communication solution that integrates various, such as voice, video, messaging, and collaboration tools, into a single platform.
CCaaS: Contact Center as a Service is a cloud-based customer support solution that streamlines contact center operations with advanced features and sophisticated reporting.
The Cloud Advantage
Cloud-based business communication solutions, including VoIP, UCaaS, and CCaaS, offer numerous business advantages. These benefits include:
- Cost Savings: Cloud-based communication solutions typically have lower setup and operational costs than traditional landlines. VoIP, for example, enables cost-effective calls via the Internet, reducing the need for expensive hardware and phone lines.
- Scalability: Cloud communication systems, such as UCaaS, allow businesses to easily scale up or down based on their needs, adding or removing users and features without significant costs or complications.
- Improved Collaboration: UCaaS platforms integrate various communication tools, like voice, video, messaging, file sharing, and more, into a single platform. This facilitates seamless collaboration among team members, increasing productivity and efficiency.
- Enhanced Mobility: With cloud-based communication services, employees can access their work tools from any location using their preferred devices. This flexibility enables remote work and supports a modern, mobile workforce.
- Advanced Features: VoIP, UCaaS, and CCaaS offer advanced features, such as call routing, call recording, video conferencing, and analytics, which help businesses optimize their communication processes.
- Streamlined Customer Support: CCaaS solutions centralize customer support operations and provide tools to improve customer interactions, such as intelligent call routing, integrated customer data, and real-time analytics.
- Easy Integration: Cloud-based communication systems can be easily integrated with other business applications, such as CRM and ERP software, enhancing the efficiency and effectiveness of various business processes.
- Business Continuity: Cloud communication solutions have built-in redundancy and disaster recovery features, ensuring businesses can maintain communication during unexpected events or downtime.
- Simplified Maintenance: With cloud-based communication solutions, the service provider handles system maintenance, upgrades, and troubleshooting, reducing the burden on in-house IT staff.
- Enhanced Security: VoIP, UCaaS, and CCaaS providers invest in robust security measures, such as encryption and strong access controls, to protect business communications from unauthorized access and potential threats.
Cloud-based business communication solutions like VoIP, UCaaS, and CCaaS offer cost savings, scalability, improved collaboration, enhanced mobility, advanced features, streamlined customer support, easy integration, business continuity, simplified maintenance, and enhanced security, making them an attractive choice for modern businesses to replace their landline phones.
There’s No Time Like the Present
Although POTS customers will eventually need to replace their landline phone service, the increasing costs and declining support for copper wire are prompting many to explore the advantages of cloud-based UCaaS and CCaaS solutions. Switching to cloud communications sooner rather than later is proving to be a wise business decision for many.
While switching from landline phone service immediately is not mandatory, POTS prices are expected to keep rising. Transitioning from landline phones to a cloud-based solution is a practical option for many business customers.
Goodbye Landline Phone — Hello Productivity and Cost Savings
If you’re considering replacing your landline with a cloud-based solution that enhances efficiency, productivity, and collaboration while reducing your communications spending by up to 55%, give the Crexendo® VIP™ UCaaS and CCaaS cloud platform for business communications a test drive. Schedule your free VIP demo today!