Mobile phones are replacing fixed-line phones

Mobile phones are now rapidly replacing fixed phone lines in Europe in a big way, according to market analyst Frost & Sullivan.

The company says that as mobile operators offer ever cheaper voice call packages and mobile data services become more widely taken up by users. It predicts that in 2003, the number of fixed line call minutes fell by 5% and the number of fixed lines decreased by 500,000.

Frost & Sullivan analyst Jan ten Sythoff said, “The major drivers for fixed to mobile substitution include increasing mobile voice competition, mobile saturation, 3G capacity, and the emergence of location-based charging.”

The marketing strategy of UK 3G operator 3 illustrates what fixed line operators are up against, with 3 offering users 750 bundled voice minutes and 750 text messages a month to any network for only £35 whether on a contract or using pre-pay. 

However, mobile does not have it all its own way in the market. “The mobile market is however, up against a number of restraints, such as growing fixed line competition, cheaper fixed line pricing, and limitations in mobile technology such as coverage and voice quality,” said ten Sythoff. 

But the growing confidence of mobile operators is expected to lead to them targeting the fixed line voice call market too, said ten Sythoff.

Mobile operators are already in partnership with PBX (private branch exchange) suppliers and are starting to offer integrated solutions that allow mobiles to be connected via a PBX to enable cheaper voice calls, instead of using more expensive mobile networks. 

This article was part of Computer Weekly's enterprise mobile business channel, sponsored by Nokia