Ofcom: Business fixed phone lines fall

While consumer use of landlines continues to grow, corporate calls are moving to mobile or IP telephony networks

Businesses are turning away from traditional fixed phone lines in favour of mobile or internet-based telephony, according to research findings released today.

Ofcom’s annual communications market report showed the number of business lines decreased for the fourth year in a row during 2011, dropping by another 3.1% to 9.4 million.

The regulator claimed there were three factors that were the likely contributors to this fall, including lower employment levels thanks to the recession.

However, the other two reasons were improvements in technology offering corporates other options than fixed line phones.

“[There is] a trend for businesses to discontinue lines for workers who work remotely or in more of a mobile environment… and [there has been] increased use of IP-based backhaul for business telephony,” read the report.

Unsurprisingly, calls on fixed lines also declined, dropping 9.1% to just below 29 billion minutes. This lead to revenues for fixed line calls, falling by 4.8% during 2011.  

Rob Bamforth, principal analyst at Quocirca, said mobile had been replacing fixed lines for some time, but businesses needed to be aware of the costs involved. However, another new trend can help with that, according to Bamford. “BYOD (bring your own device) only drives the move to mobile further, and when individuals take care of the contract themselves as BYODs tend to do, the costs are no longer an issue for the organisation,” he said.

Bamforth was more positive about the changes in IP telephony adopting, however. “IP telephony has grown because organisations have realised that not only is voice communications something people need to do while they are on the move (hence the growth of mobile), it is also something that needs to be integrated with everything else,” he said.

“That is no longer the idealistic marketing spin of 'unified comms' but the needs of companies being addressed. Where once IP telephony was being adopted as a way to make cheaper calls, it is now becoming part of a toolkit of collaboration and so getting wider and faster adoption. It's no longer about IP phones, but total IP comms, and sometimes it is even unified.”

Whilst landlines have faltered in the business world, there has been a solid rise in the number of broadband lines going into office environments. Subscriptions for businesses rose 8.8% in 2011 to 1.7m, which equated to one in 12 of all broadband lines in the UK.

Mobile broadband was another technology being rapidly adopted by corporate customers, with the report claiming businesses were even more enthusiastic than consumers about the connections.

By the end of last year there were 1.4 million mobile broadband connections subscribed to by businesses, making up for 13% of all mobile business connections. Consumers may have signed up for more – 3.7 million – but this only equated to 5% of consumer mobile connections, showing a stronger desire from business users.

“This greater usage of mobile broadband may be due to the increasing number of employees wishing to access company data services on the move and the increasing proportion of employees using a laptop,” read the report.

“Mobile operators are also offering a broad range of low-price mobile broadband deals for businesses. These vary considerably by contract length and size of bundle. Some tariffs are positioned to allow mobile broadband to be either a regular or back-up service, which may suit different business usage requirements.”

Earlier today,Ofcom announced a new pilot to charge telecoms providers 10p for every phone number they are allocated, in order to ensure they are more efficient with the limited supply of combinations available. 

Read more on Voice networking and VoIP