FCC: 20% of US Landlines Now VoIP

The US telephone market is more diverse and complex today than at any time before. To that point the US FCC recently reported a fairly dramatic piece of data: almost 20% of US residential landlines are now VoIP-based. 

According to the press release associated with the release of the FCC "Local Telephone Competition" report:

  • At year-end 2008, there were 141 million traditional switched access lines in service and 21 million interconnected VoIP subscriptions in the United States, or about 162 million wireline retail local telephone service connections in total. Of these, 97 million were residential connections and 65 million were business connections.
  • Of the 162 million total connections, 48% were residential switched access lines, 39% were business switched access lines, 12% were residential VoIP subscriptions, and 1% were business VoIP subscriptions.
  • Of the 97 million wireline residential connections, 74.5% were ILEC switched access lines, 19.5% were non-ILEC interconnected VoIP subscriptions, 5.8% were non-ILEC switched access lines, and 0.3% were ILEC interconnected VoIP subscriptions.

These data are from 2008 so they're bound to be different now. The VoIP penetration might be as much as 5 points higher today. 

The vast majority of US residential VoIP subscribers (81%) receive VoIP as part of a "broadband bundle." This is primarily cable companies offering discounted packages of Internet, TV and telephone together. This is part of a larger cable strategy to retain subscribers and steal voice revenues from rival telcos. 

Over time more residential calling will move to lower-cost VoIP or wireless plans. However, the move toward tiered pricing could affect consumer behavior accordingly. Today, according to the US CDC, 25% of US households have no landline at all.